Joint deals put strain on core brand values

Jet’s bizarre plan to link with The Body Shop underlines a growing trend in partnership marketing. But financial gain can often override brand value. By Jon Rees

To call them strange bedfellows hardly does them justice. The Body Shop, a seller of environmentally friendly massage oil, in bed with a purveyor of the dirty, sticky real thing Jet (the petrol station arm of US oil giant Conoco) have met to discuss a joint venture (MW July 5).

That’s certainly what happened, although The Body Shop claims it met Jet “in the spirit we would agree to meet any business that wanted to talk to us” and after a brief chat made it quite clear that it was not interested in linking with the company’s retail activities.

For Jet, however, the story does not end there and when asked if it considers its attempted link-up with The Body Shop to be over, marketing manager Mike Stannard refuses to admit defeat.

“We will continue to investigate links wherever possible; you do not always achieve success [at the first hurdle].” Stannard went on to say that Jet wants to join forces with other companies.

“It’s got to be a partnership and it’s got to be equitable. Especially if we’re working together on the same premises. The values have to be similar,” says Stannard.

Given these last comments, it does seem extraordinary that Jet thought The Body Shop would give it the time of day and perhaps even more extraordinary that it actually agreed to a meeting.

While these two companies appear particularly ill-suited, it would be wrong to assume that every brand partnership has to be a perfect fit. “In many cases, not being a bad fit suffices,” says Jeremy Stern, BT’s head of affinity marketing for the personal communications division.

BT has tie-ups with a number of companies. Most recently it has done a deal with British Airways to expand its “Friends and Family” discount scheme by offering members up to 30 per cent off flights. In this case, both companies’ brand values are well-suited, as indeed are BA’s and Sainsbury’s, which also have a tie-up.

But Stern takes a pragmatic view of matching brand values. “Strategically we may want to talk to a number of companies which are leaders in their field but when you ring up and they say ‘No’ you have to go somewhere else.”

Others agree that long-term brand values often have to take second place to immediate financial gain, especially with the recent surge in the number of co-branded credit or loyalty cards on offer.

Tom Blackett, deputy chairman of brand consultancy Interbrand, says the loyalty card boom has resulted in some unlikely combinations. “Some tie-ups, like Sainsbury’s and BA, are a perfect fit but there are some strange bedfellows. General Motors and Visa with the GM Card – what on earth is the consumer meant to identify with there? What is added to either of these brands? What is the long-term benefit to either partner’s brands,” he says.

The answer to the last question is probably “not a great deal”. Blackett, however, says the companies concerned in such tie-ups are usually “cute enough” to know when to cut and run.

American Express has co-branded credit cards with Peugeot-Citroë in France. On the face of it this is an extraordinary move for a financial services company which has built its brand on exclusivity: here it is linking up with two mass-market brands.

Amex says it sees no discrepancy but the strategy illustrates the way it is beginning to change its image to be seen as perhaps less of premium brand than in the past.

“We want to be an aspirational brand but Amex has been called too exclusive and we want to grow. Our brand perception is important but we want to be relevant. Amex, Peugeot and Citroë are seen as relevant, hard-working brands which are going forward,” says Russ Shaw, Amex vice-president advertising and brand management Europe.

Shaw describes the deal as a “win/win” situation, since each side is able to gain something from the deal which they would not have been able to get on their own or with another partner.

If this is so, Amex has done well. According to one source experienced in this sort of high-profile plan, negotiations usually founder when deciding who benefits most from a joint branding deal – or who is paying the bill.

“There always comes a point when each side takes the weighing scales out to see what they are getting and each is automatically biased towards its own side. The best kind arrangements occur when there is willingness to compromise on both sides,” says Shaw.

In some sectors the limited nature of suitable tie-ups mean chances have to be seized almost regardless of brand implications. BA is linked with Shell through Air Miles, as well as Sainsbury’s and NatWest.

However, NatWest cannot link up with Sainsbury’s, on a co-branded credit card for instance, and thereby complete the loop since it is already in a relationship with Tesco. So market forces push brand concerns into second place.

The Body Shop and Jet may always have been an unlikely pairing but, distressing though it may be to marketers, brand values are not always the prime consideration when a potentially lucrative joint venture beckons.