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2023: The Year of the Brand Crossover

January 25, 2024
in Entertainment
2023: The Year of the Brand Crossover
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A longtime milk tea enthusiast, 24-year-old Fei Nanxi from the eastern Jiangxi province did not think there could be another version of the sugary beverage that would surprise her. That is until major milk tea brands began deploying a new tactic to get young urbanites like her back ordering regularly again: co-branded drinks.

Also known as brand crossovers, co-branded products are usually jointly launched by two well-known brands and made available for a limited time. These products, analysts say, help expand brands’ consumer base and increase brand recognition, especially among younger consumers.

Often the brands form surprising pairs, such as Fei’s favorite in the past year: a tea drink jointly launched in July by popular Guangzhou tea chain HeyTea and Hong Kong jewelry conglomerate Chow Tai Fook.

Promoted with slogans such as “your first pot of gold,” the drink itself seemed secondary to the merchandise that came along with it: a gold-hued cup, with a matching straw and badge.

According to CBNData, the number of co-branded products increased significantly last year: a jump of 35.9% from 2022 to around 900 in total. The most popular industries included milk tea, sportswear, coffee, and skincare.

Surveys show that consumers largely embraced these products. Business media outlet DT Business Observer found that over 80% of 1,023 respondents purchased co-branded beverages last year, while nearly 70% bought co-branded food.

The trend has continued into the new year, including Starbucks’ tie-up with classic Chinese animated film “Havoc in Heaven,” which celebrates its 60th anniversary this year. The U.S. coffee giant heavily promoted the move on its Chinese social media accounts, a common feature of such brand crossovers.

Arguably last year’s biggest crossover was the collaboration between domestic coffee chain Luckin Coffee and baijiu giant Kweichow Moutai, which dominated online discussions quickly after its launch in September. An estimated 5.42 million cups of the alcohol-infused coffee were sold on the first day.

Shopping influencer Xu Yi, based in Shanghai and who posts via lifestyle platform Xiaohongshu, notes that major consumer brands have of late partnered with three main types of co-brands: luxury brands, traditional Chinese institutions such as museums or landmarks, and ACG outlets — animations, comics, and games.

Though brand crossovers may only be temporary, she believes they can promote brand loyalty among consumers eager to collect products and merchandise related to the crossovers.

One such consumer is Zhong Xingyu, a 25-year-old man in Shanghai, who has collected around 600 brand crossover merchandise since July, including cup holders, stickers, and bags: “Collecting and admiring these pretty and colorful cup holders brings me joy and a sense of accomplishment.”

However, the increasing frequency of brand crossovers also runs the risk of inducing consumer fatigue. The same DT Business Observer survey also found that only a third of respondents reported being more interested in co-branded products than in the past.

Some brand crossovers have even courted controversy for their insensitive content, including a famous ceramics museum’s tie-up with HeyTea that was quickly scrapped following a backlash against religious imagery in the product packaging.  

Given the constant evolution of the Chinese consumer market, the nature of brand crossovers will likely continue to shift, said Marc-Olivier Arnold, partner and chief strategy officer at Shanghai-headquartered RTG Consulting Group.

“One potential direction in the future could be consumer brands exploring partnerships with health and supplement companies … catering to the growing interest in personal wellness among Chinese consumers,” he said.

Arnold sees parallels between the brand crossover trend and the guochao trend that has emerged in China in recent years, whereby domestic brands emphasize their Chinese roots to appeal to patriotic consumers. Similarly, foreign and domestic brands may use traditional Chinese co-brands to simultaneously tap into both the guochao and crossover markets.

“Brands need to assess how the collaborations align with their overarching brand narrative and, better yet, think of how these collaborations can maintain continuity beyond the initial period of buzz and excitement,” he said.

Editor: Vincent Chow.

(Header image: From Weibo)

>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : SixthTone – https://www.sixthtone.com/news/1014538/2023:%20The%20Year%20of%20the%20Brand%20Crossover

Tags: “crossover”Brandentertainment
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