How To Boost Performance by Locating Near Synergistic Brands
At Seaker, we know you’re busy so here’s the TL;DR:
Brand Synergy is when you strategically locate near sought after brands
It allows you to tap into peer or competitor fans and make them your own.
This brings down acquisition costs, increases awareness and drives sales.
Brand Synergy also occurs when you locate in markets that improve consumer perception of your brand.
According to a study by Coresight Research, the U.S. shopping mall industry has bounced back in a big way. What's the secret sauce behind this resurgence? We already talked about the "halo effect" created by a seamless blend of online and offline channels, but there is another concept called "brand synergy," that is buzzing through the mall world.
Brand Synergy is basically “good co-tenancy” but more intentional and strategic. It's the magic that happens when your store is strategically located next to other high-value or sought-after brands. This synergy allows you to tap into their existing fan base and multiply your own. It's like a retail game of "I scratch your back, you scratch mine."
At Seaker, depending on your brands industry, category and strategy, we categorize synergistic brands in two ways:
Competitors - These are brands with the exact same offering as your brand who directly compete for the same customer. Think of an emerging outdoor apparel brand wanting to be located near a legacy outdoor apparel brand.
Peers - These are brands that are complimentary to your brand who indirectly compete for the same customer. Think of a Mediterranean fine dining restaurant being near an Italian fine dining restaurant.
In today's retail landscape, understanding the tenant profile of a shopping center or district can make all the difference. If a destination is flush with synergistic brands that can dramatically improve your acquisition costs by tapping into a steady stream of existing, engaged shoppers thus driving sales through proximity.
However, if you’re alone on a deserted retail island with no brand synergy to take advantage of, you’re going to have to work harder and spend more to get customers to your location.
Take Untuckit, for instance, which strategically positions itself adjacent to legacy brands like Brooks Brothers or J.Crew. This deliberate choice enables them to attract similar customers and showcases the power of brand synergy in action.
Express, the fashion-forward apparel brand, employs a unique strategy of shopping destination profiling. They meticulously study mall profiles and analyze co-tenants in malls where they're already thriving. By profiling malls, Express understands the primary interests of their customers, allowing them to choose the right co-tenants. For them, it's all about co-locating with fashion and apparel giants like Aritzia, Banana Republic, H&M, and Uniqlo.
Brand Synergy can extend beyond shopping destinations and can apply on a broader market level too.
At Seaker, part of what we ask ourselves when evaluating a market is, “What would the consumer’s perception of our client’s brand locating in this market versus another market?” Then we measure brand building factors for that specific client in target markets.
An outdoor lifestyle and apparel client of Seaker’s (name withheld) was trying to determine which markets would be best for brand building locations. They had nearly every top outdoor market on their roadmap to choose from.
After taking into account the Brand Synergy of a market things got easier. It became clear that mountain towns would be ideal markets for flagships because the client would be able to showcase their entire product line, which included insulated apparel, where consumers can actually use and benefit from their product.
A very straightforward example that can be applied to even the most complicated and nuanced of location-based brand offerings.
Without a doubt, shopping destinations are taking advantage of Brand Synergy to attract similar best-in-class tenants while retailers are using it to create brand awareness, reduce acquisition costs and drive that sweet, sweet revenue.
Now we want to hear from you! How are you thinking about Brand Synergy and what results is it leading to in your business?
Let us know in the comments below.
Find out how Seaker can help your brand harness the power of Brand Synergy to guide site selection and improve performance by reaching out to questions@theseakergroup.com.
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