What is Ingredient Branding?

If the term Ingredient Branding isn’t completely known to you yet, then you came across the right page. We will answer most common questions on Ingredient Branding, provide best Ingredient Brands examples and lead you to additional sources to discover the topic of Ingredient Branding in more depth.

Why do we feel confident to spread our knowledge on Ingredient Branding?
BRAIND® is the only Brand Strategy Consulting firm working exclusively in the field of Brand Partnership Models such as Ingredient Branding and Co-Branding. Our experienced team has consulted in over 30 projects on 3 different continents and our Managing Director, Tomas Vucurevic, has over 25 + years of experience in Ingredient Branding. Thus, for almost a decade he was the Global Brand Manager of one of the world’s most famous Ingredient Brands: Gore-Tex®.
In case you are already familiar with Ingredient Branding, visit the BRAIND® Website for a more comprehensive outlook and find details about our activities with some of the most fascinating Ingredient Brands on our References list.

What is the definition of Ingredient Branding?

Wikipedia defines Ingredient Branding as ‘creating a brand for an ingredient or component of a product, to project the high quality or performance of the ingredient’. Another popular definition is Intel’s ‘a promotion of a brand within a brand to the end user’. In that sense Ingredient branding is a vertical co-branding between the provider of a component, material or service and the provider of a final product that incorporates that ingredient. Ingredient Branding requires a multi-level marketing approach, where the component or ingredient is promoted to at least one level further than its direct clients in the supply chain with the clear target to stimulate a pull for the component throughout the demand chain.

Our definition of Ingredient Branding is: PARS PRO TOTO*. What does that mean? It means that the ingredient is becoming a trigger for the buying decision in favor of the final product. The ingredient can be a material, a component a production process, a specification or a service that is relevant for the buying decision of the end user.
* part taken as a whole

What is the difference between Ingredient Branding and Co-branding?

Ingredient Branding highlights a specific component or brand attribute to enhance a product or a service. It is a long-term process in which the ingredient is becoming a part and cannot be separated from the final product. The Ingredient Brand can create awareness, differentiation and preference for the final product in the down-stream value chain. Some recent examples can be find on our blog, where you can read about the cooperation of Freytag X WeAreSpinDye or Garcia Denim with RadyGo.

Co-branding on the other side typically involves two finished consumer products used in a single product or service. The purpose of Co-branding is to capitalize on the equity of each brand and enhance the success of the total product. It has more promotional character than Ingredient Branding and is short-to mid-term orientated. Good examples of successful Co-branding are Omega & Biosteel, Panzerglass & Swarowski, McDonalds & KitKat, Nike & Apple, GoPro & Red Bull or Adidas & Five Ten.

How do Ingredient Brands differ from so called self-branded components?

Self-branded components are only available within one brand, like NikeAir or Audi Quattro for example. Ingredient Brands are available through multiple brands and ideally in various applications, performance levels and price points, which are crucial elements to successfully build an Ingredient Brand.

Which are the best examples of the most successful Ingredient Brands?

Ingredients Brands can be found in various industries, from fashion to transportation, electronics and even banking & finance. Gore-Tex, Shimano, Dolby, Teflon, Tetra Pak, Paypal or Android are just a few Ingredient Brands that have successfully become triggers for the buying decisions of finished products incorporating them as relevant components and adding value to their host brands.

The best-known example of an Ingredient Brand is without doubt Intel with its “Intel Inside” campaign, launched in 1991. It has helped fuel almost a 12-fold increase in net income for the company and making the microprocessor brand a key decision-driver in the personal computer purchase process.

What are opportunities and risks of Ingredient Branding?

As an Ingredient Brand you step out of the role of a supplier to become a business partner on eyesight. This allows you to create a competitive differentiation and capitalize on the positive image of the end products made with your ingredient. By applying an Ingredient Brand strategy, you can increase brand awareness and brand loyalty among your customers and create entry barriers for competitors in your sector.

On the other hand, stepping out of anonymity by acting as an Ingredient Brand comes with a great responsibility. Your brand becomes identifiable, which means that your activities are now visible for competitors who may adopt a similar business or marketing approach. Additional costs and resources for marketing occur as well. Another risk associated with Ingredient Branding is that bad collaborations with unsuitable brand partners can damage your own brand.

How to build an Ingredient Brand Strategy?

In order to build your Ingredient Brand, you have to first create a pull-effect through meaningful, purpose-driven Brand Programs. You have to start acting as an Ingredient Brand and constantly manage the push/pull activities of the demand chain to extract more value from your innovation.

In the next step you have to start conducting your brand partner network. Ingredient Branding is much more than putting a tag and a label on the finished product. It is a Brand & Business Model by which a company actively manages its total brand experience through multiple layers of direct and indirect customers and communications. The ability to manage such a brand network is crucial, as brands are perceived in the entirety of their appearance.

How can we help you with defining your Ingredient Brand Strategy?

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How can your product be successfully commercialized through an Ingredient Brand Model?

The Ingredient Brand Model must reflect a compelling and profitable business strategy that leverages the strengths of a company organization. Through our online Ingredient Brand Fitness Check you can test how fit your product or service is in order to be successfully commercialized through an Ingredient Brand Model.

The BRAIND Ingredient Brand Fitness Check leads you through a set of ten questions and gives you an immediate rating on your Ingredient Brand performance. Once you complete it, the results get delivered straight to your inbox.

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