Toyota is apparently considering the idea of separately branding Prius. The hybrid product line currently maintains a sub-brand role, meaning that it’s preceded by the name Toyota and its value is always in relation to that of its parent. Should Toyota consider splitting off the product to make it a brand of its own? What are the merits? What are the downsides?  

I’ve outlined the process used to make a decision like this because it’s one many companies find themselves having to make but without a clear methodology. If you’d like, you can also check out my recommendation at the bottom of Susan’s original post.  Do you agree?  

First, make your default position one of staying the course.   Creating a new brand takes time and money and you have no guarantee that the public will want it.  This is especially true for a new umbrella brand—one that is not associated in any way with an existing, viable brand.  A strong existing brand is a kind of shorthand for value that allows consumers to choose a product without knowing as much about it.  For instance, when I say Honda, what comes to mind? 

If you think you must brand, use these tests: 

Is this a new business category?  Who is this serving and how is it different from your existing brand’s category?  Begin by making sure it really is different.  Then, determine how your unique approach will create a new context for customers.  For instance, we help our clients develop a strategic role which defines why prospective customers must consider them when looking at vendors in a given business category. 

Does it support your strategic plan?  If it doesn’t help you get to where you want to go, or even conflicts with your business strategies, then  it shouldn’t be a brand.   

Will the brand enable long-term growth?  Will this brand be a significant driver of revenue and profit growth?   Do you expect it to be a rising star over the long term? 

Are there specialized competitors?   Sometimes you may need to create a sub-brand in order to effectively compete.  If you are providing a product as part of a larger offering (such as computer chip in a laptop) and others are naming theirs (such as Intel) then your undifferentiated product will telegraph to people that computer chips are not a real focus of yours. 

Two common mistakes: 

Creating a new name for every new product or service to add distinctiveness.  Too many CEOs and product managers think that creating a new brand or brand name will give their product or service more customer mind share.  The opposite is often true.  You will end up with a confusing, alphabet soup of products that customers won’t be able to decipher.  

Branding a feature.   Whatever is the new ‘it’ trend in our society becomes an irresistible magnet for unfortunate branding.  Right now, this looks like brands that are developing around sustainability and being green.  While it seems appealing, does it really make sense to create a separate, environmentally friendly line of toilet paper or cars instead of making this a feature of all of your offerings?  Consider this.  In the early 2000s, people thought that anything .com (remember pets.com?) was a sure brand winner.

-Joe LePla

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