Umbrella brand

Umbrella branding (also known as family branding) is a marketing practice involving the use of a single brand name for the sale of two or more related products. Umbrella branding is mainly used by companies with a positive brand equity (value of a brand in a certain marketplace). All products use the same means of identification and lack additional brand names or symbols. This marketing practice differs from brand extension in that umbrella branding involves the marketing of similar products, rather than differentiated products, under one brand name. Hence, umbrella branding may be considered as a type of brand extension. The practice of umbrella branding does not disallow a firm to implement different branding approaches for different product lines (e.g. brand extension).

Umbrella Branding is used to provide uniformity to certain product lines by grouping them under a single brand name, making them more easily identifiable and hence enhancing their marketability. All products under the same corporate umbrella (masterbrand providing structure and credibility to other products of the corporation) are expected to have uniform quality and user experience (e.g. All products carrying the parent brand must be of the same high quality standards).

Factors that may determine the impact of umbrella branding include:

Various theories attempt to explain a consumer's decisions and judgements during product purchasing that cause umbrella branding to be a successful marketing strategy.

The categorisation theory is based upon the notion that consumers tend to categorise products by associating them to brands and their past experiences with those particular brands (stored in their category memory) in order to evade the initial confusion caused by the extensive choice of products they are presented with. New information on certain products are categorised into various sections such as product class (e.g. beverage) and brand (e.g. Coca-Cola) and then stored. Afterwards, consumers evaluate the product quality through past experiences with the brand's products as well as the brand equity.

This theory also explains for the popularity of umbrella branding. Consumers tend to evaluate new products not only by positive brand equity but also if the brand's concept is consistent with their extended products. For instance, assuming that the consumer had satisfactory past experiences with the company's products, if Apple Inc. would develop and sell a new version of a Macbook, consumers would deem it more reliable and potentially of superior quality rather than if Apple would produce a new beverage due to Apple's past product line.

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