Brand Portfolio Strategies

Posted by Oliver Koll on Jan 31, 2019

Brand architecture helps manufacturers to structure their different brands in a systematic way. Two main strategies exist: A Branded House strategy relies on one leading brand that distinguishes all product lines, often across categories (e.g. Tchibo, Nivea, Tesco). A House of Brands strategy uses individual brand names, with the corporate name often taking a less prominent role (e.g., Unilever, Nestlè). We investigated the proliferation of these strategies amongst all owners of brands in 80 FMCG categories in 6 countries*.

  • Just over one third (35%) follow either a Branded House (10%) or a House of Brands (25%) strategy. The majority typically own one brand in one category and competes in one country only. On average, House of Brands manufacturers operate in 3.1 different categories, Branded House manufacturers in 2.5 different categories.
  • There is significant variation by country. A Branded House strategy is most common in Germany (16% of manufacturers), and least common in Brazil (4%). Romanian companies are most likely to be a House of Brands (29%), with Ireland trailing the other markets (19%).
  • 14% of all manufacturers operate in more than one country. More than the half of these international players follows a House of Brands strategy, and 16% operate with a Branded House.

If a manufacturer has multiple brands, the House of Brands approach is by far the most common, likely because it is easier to reach more diverse shopper needs and demographics.