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Thread: What's the benefits of creating 2 different brands selling the same product/service?

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    What's the benefits of creating 2 different brands selling the same product/service?

    What's the benefits of creating 2 different brands selling the same product/service? I've seen companies doing this. Why?

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    Senior Member GekiDan's Avatar
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    Having two brands with the same product or service promotes competition. If there's a competition, more likely, people can choose which one they want to buy and what service they want to use.

    Take for example, Coke, Sprite and other Coca Cola products.
    They are both softdrinks but there are people who prefer Coke over Sprite but there are others who prefer the other one.

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    Senior Member chrisdina's Avatar
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    different markets sometimes have different naming conventions; I think this is to do with ownership- X may have been brought out by Y, but still operates under the name of X. Y obviously gets a chunk of the profits...maybe X wanted to be brought out for investment purposes (wanted to expand in that particular market/region)

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    Mike, companies sometimes do this to capture different segments of the market. For example Toyota cars are targeted at working and middle class customers and perhaps might be looked down upon by extremely wealthy individuals. Toyota saw this as an opportunity and introduced the Lexus brand to target customers from the higher social classes. These individuals would be more likely to buy the Lexus brand than a higher priced Toyota car, with all the same features.

    Having more than one brand in a particular product or service category can also help companies create the illusion that there is competition, when in fact there is none. Customers then look at different brands when making a purchase, without the realisation that the brands are in fact all owned by the same company.

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    Senior Member seanstevens's Avatar
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    The example of Toyota with Lexus above is a good one. Car manufacturers use it all the time, however there is a downside as GM found out. If you lose sight of what all your brands are doing then you end up directly competing against yourself at the same price level and put yourself out of business!

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    By choosing to create two separate brands, a corporation can go after two completely different target markets, benefiting the corporation as a whole. Take Gap, Inc. for example, Old Navy focuses on a consumer with price as it's main sticking point. The other end of Gap, Inc., includes Banana Republic, whose consumer base focuses more on quality of the product for the customers. In the end, it's a greater way to target more consumers and increase a company's overall earnings.

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    Member Aquarezz's Avatar
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    Well, this is something people on webmaster forums are doing. For example, if I would sell my service on DigitalPoint between thousand other DP users there's a chance I'm selling things, but if my friend also posts the offer but with different text, there is more chance to get buyers

    Now if someone doesn't like my service, they can say: "We'll try this person his service, as the other one wasn't good". But what they don't know is, that both services are lead by the same person and in the end the money goes all to one big boss

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    Creating 2 different brand creates a competition.
    Customers will have only one product,
    Competition is very important in any industry.
    If there is no competition, the product features would not be taken quickly.

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    our consumer will get much information about our product.

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    Quote Originally Posted by GekiDan View Post
    Having two brands with the same product or service promotes competition. If there's a competition, more likely, people can choose which one they want to buy and what service they want to use.

    Take for example, Coke, Sprite and other Coca Cola products.
    They are both softdrinks but there are people who prefer Coke over Sprite but there are others who prefer the other one.
    The second paragraph, I believe, is failure. Your example show only that one company has two or more products.

    In my opinion, chinese usually created two or more brands to increase salary of their products. They decrease price of one brand, then does the same with the other. And since some people aren't as smart as they look, they see a discount and instantly buys the product/service.

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    Well, the companies want to have two different brands that offer same or similar service or product because they want to give choice and make extra money. Consumers don't just want one thing; if there can be variants made of the product different people will choose it. Say, for example, a group of people like Brand X. Another group of people hate Brand X but like the product. So, the company makes Brand Y. Now both groups can enjoy this product and buy from the company.




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