Brand Building - Affiliate Programs And Co-branding

AFFILIATE PROGRAMS AND CO-BRANDING

Start-up and relatively unknown online companies can use affiliate relationships to build awareness of their brand as well as to attract new customers. When barnesandnoble.com became the featured bookseller on America Online, its brand awareness rose significantly in the online community. In mid-1998 Ameritrade expanded its relationship with America Online by committing to pay $25 million over two years for a prominent spot on America Online's finance page, thereby strengthening its brand name among AOL's subscriber base. 1-800-Flowers.com, which has been in business for 24 years, told the New York Times that its partnership with AOL was its most productive; the company also had productive marketing agreements with MSN.com and Yahoo!.

Co-branding with an established brick-and-mortar company is another way that online retailers can gain the benefits of a strong brand. Virtual retailers without their own brand identity can co-brand with traditional merchants to gain credibility and trust and drive traffic to their Web sites. Flooz.com, for example, used its merchant partners—including Martha Stewart and Tower Records—in its advertising to help strengthen its brand name, build trust and confidence, and explain the benefits of its Web site.