Marketing antecedents of industrial brand equity: An empirical investigation in specialty chemicals

Industrial branding has emerged as an important issue, allowing firms to gain substantial competitive advantage, especially in markets where product commoditization and electronic procurement are on the increase. This article proposes, and empirically validates, a theoretically structured approach to measure brand equity, its antecedents and its consequences for industrial products. The model distinguishes between product and corporate brand equity, uses buyer perceived performance on the dimensions of the marketing mix as antecedents of brand equity, and relates them to re-purchase and loyalty intentions.     

The Role of Fashion Brand Authenticity in Product Management: A Holistic Marketing Approach

This study explores the multidimensional construct of brand authenticity and the effect of each component on brand attachment, brand commitment, and brand loyalty by focusing on fashion brands in sporting goods. For this study, two global sports brands, Nike and Adidas, were selected, and brand stimuli (cartoons with scenarios) were designed based on a qualitative analysis of brand cases. A total of 207 usable responses were obtained from Korean consumers who had purchased the selected brands. The findings show that fashion brand authenticity consisted of seven factors: authority, fashionability, consistency, innovativeness, sustainability, origin, and heritage. Of these factors, authority, fashionability, innovativeness, and sustainability were significant predictors of brand attachment, and authority, consistency, and innovativeness were significant predictors of brand loyalty. There were differences in the effects of brand authenticity on brand attachment and brand commitment between Nike and Adidas. From a managerial and holistic marketing perspective, implications are suggested regarding the importance of managing brand authenticity in product innovation and management approaches.     

Brand stability as a signaling phenomenon — An empirical investigation in industrial markets

The present study investigates the interplay between brand stability and customers' response toward the brand in an industrial buying context. Based on an information economic perspective, the authors develop a conceptual framework that incorporates perceived brand stability, risk reduction, brand loyalty, and customers' willingness to pay a price premium. This framework is empirically tested based on a survey with one hundred and forty nine key informants from business units within the food industry. In order to analyze the proposed relationships, the authors employ structural equation modeling. The present research contributes to a deeper understanding of the role of brands in business-to-business contexts by highlighting the signaling effects of brands in an industrial buying context. Second, the present research empirically demonstrates that brand stability is a key factor to (1) reduce perceived risk, (2) build brand loyalty, and in turn (3) achieve a price premium.     

Service inside: The impact of ingredient service branding on quality perceptions and behavioral intentions

Extant literature on ingredient branding is directed at tangible products but does not account for the role of services as ingredients. For B2B suppliers, however, service is emerging as the dominant route to achieving competitive advantage. The purpose of this research is to investigate how ingredient service brands impact customer preferences on B2B markets. We specifically assess how ingredients might impact industrial buyers' quality perceptions of the end product. By conducting a within-subjects scenario-based experiment among industrial buyers, we find a positive effect of the presence of an ingredient service brand on buyers' perception of the end product's service quality, whether the host brand is of higher or lower quality. The effect is stronger when the quality of the host brand is lower. Furthermore, results indicate that the host brand generally has a stronger impact on the quality evaluation of the end product meaning that an ingredient service brand cannot fully compensate for a lower-quality host brand. For managers, our findings indicate that ingredient service brands provide a cue to product quality of the end product, indirectly improving purchase intentions. As a result, branded service ingredients offer host service brands as well as ingredient service brands a potentially powerful strategy for improving competitive position in B2B markets.     

When Things Go Wrong,Don't Rely on Committed Consumers: Effects of Delayed Product Launches on Brand Trust

Consumers understand product preannouncements as credible promises to bring innovations to market at a given time. However, a majority of preannounced products are introduced with some delay. This study investigates potential loss in brand trust due to delay and the role of brand commitment in this process. Building on the Commitment‐Trust Theory of Relationship Marketing, which posits trust as a crucial antecedent of the commitment construct, this study extends this common perspective and proposes an additional reversal path from commitment to trust. That is, in the case of a delayed launch, the more stable commitment should buffer a loss in brand trust, which is more fragile. In three studies, this research finds consistent evidence that consumers lose trust in brands as a result of delayed launches. Surprisingly, high brand commitment does not mitigate such losses. In contrast, a long‐term relationship with a launching brand proves to be a buffer against losses in brand trust. Different operationalizations of brand commitment in laboratory and field experiments with brands from different product categories contribute to the generalizabilty of this work's findings.     

The influence of brand image and company reputation where manufacturers market to small firms: A customer value perspective

Branding research has largely focused on consumer goods markets and only recently has attention been given to business markets. In many business markets the company's reputation has a strong influence on buying decisions which may differ from the more specific product related influence of the brand's image. In this paper we investigate these differences by testing the hypotheses about the influences of brand image and company reputation on customers' perceptions of product and service quality, customer value, and customer loyalty in a business market where there are three manufacturers marketing their brands directly to a large number of small firms. The results indicate that the brand's image has a more specific influence on the customers' perceptions of product and service quality while the company's reputation has a broader influence on perceptions of customer value and customer loyalty.     

Can All Brands Innovate in the Same Way? A Typology of Brand Position and Innovation Effort*

Product innovation is vital to ongoing brand equity and has been responsible for revitalizing many brands, including Apple, Dunlop Volley, Mini, and Gucci. While several scholars have noted the relationship between a brand's position and the form of innovation available to a firm, surprisingly no study has sought to bridge this gap. This study aims to address this issue by, first, building a typology of the innovation practices underpinning differently positioned brands and, second, exploring the strategic and tactical implications of different brand‐related innovation efforts. In so doing, this study addresses a critical question: How do differently positioned brands organize their innovation efforts? A multiple case‐study approach was used in this paper. Cases were sampled from a number of industries and across a range of different countries with a focus on business‐to‐consumer brands. Thirty‐five interviews were conducted across 12 cases. The brands studied differed in their approach to innovation (incremental vs. radical) and in their relationship to the marketplace (market‐driven and driving markets). These two dimensions result in four alternative ways of organizing the innovation effort to effectively reinforce the brand: (1) incremental and market driven (follower brands); (2) radical and market driven (category leader brands); (3) incremental and driving market (craft‐design‐driven brands); and (4) radical and driving markets (product leader brands). For follower brands, new product success is contingent upon the quality of the firm's marketing information systems and speed to market. Category leaders seek to dominate and appeal to the mass market with bold product initiatives. Craft‐designer‐driven brands aim to maintain an aura of authenticity, downplaying the commercial realities of their innovation efforts, while product leader brands seek to reaffirm their status as industry pioneers. This research contributes to the branding and new product development literature in several ways. It illustrates that differently positioned brands require the deployment of different firm capabilities and resources and a unique organizational philosophy to achieve new product success. The findings also enrich the brand extension literature through an examination of alternate bases, beyond that of product category, by which brand fit can be established. Finally, this research demonstrates how brand positioning can pose limitations on an industry leader's ability to respond to disruptive technologies. This study identifies that failed new products or brand extensions are driven by a mismatch between desired strategy and the capabilities necessary for achieving success (suggesting brand extensions are not as low risk as previously thought). As such, managers should carefully attend to brand perceptions when developing innovation strategies, particularly in relation to brand extensions.     

Consumer Innovativeness and the Use of New versus Extended Brand Names for New Products*

Despite the importance of branding to new product success, little research has been conducted on how individual adoption orientation might affect brand name preferences. This paper draws on the diffusion literature to investigate how consumer innovativeness affects consumer response to alternative branding strategies (i.e., new vs. extended brands, for new products). The results of an empirical study found that consumer innovativeness has a greater effect on new product evaluations for new brand names relative to extended brand names. Also, results indicate that highly innovative consumers evaluate new products with new brand names more favorably than brand extensions. Furthermore, consumer confidence in the new product was found to mediate the effects of consumer innovativeness and its interaction with brand name type on new product evaluation. Implications include not only giving greater managerial consideration to using new brands but also supporting the chosen branding strategy with appropriate promotional efforts for respective adopter groups.     

Relationship quality as a resource to build industrial brand equity when products are uncertain and future-based

This article extends our understanding of industrial branding and the influence of buyer–seller relationships by examining key constructs within an industrial context where products are uncertain and future-based. SEM results elicited from 249 buyer surveys empirically validate satisfaction, trust and commitment as dimensions of relationship quality, and show that buyer–seller relationship quality facilitates direct and indirect seller brand equity accruals. Findings reveal that while focusing on sellers' corporate and product brands is good advice for building buyer–seller relationships, seller resource allocations to these areas should vary depending upon the selected target market segment(s). Findings support that sellers should place more focus on developing quality relationships with buyers than they should in focusing on the non-relational attributes of their corporate brands; however, if sellers choose to bypass building high quality customer relationships, they should instead funnel resources into their product brand offerings. Findings demonstrate that buyers credit their own skills and acumen when evaluating products with which they are confident, and ascribe increased value to the involvement of the seller as their attitude and certainty decrease. These findings provide strategic guidance to the sellers of uncertain and future-based industrial products.     

Manufacturer's retailer dependence: A private branding perspective

With the recent increase in the power of major retailers through consolidations, the world of brands has divided in two categories: national brands belonging to manufacturers and private brands belonging to retailers. While national brands are well studied in the literature, there is a dearth of studies on private brand phenomenon particularly from a manufacturer's point of view as opposed to that of retailers and consumers. To address this gap, we explore the antecedents and consequences of a manufacturer's private brand retailer dependence with a focus on the manufacturer's relationship with retailers. Drawing on the Resource Dependence Theory and Transaction Cost Economics, we examine various products and market characteristics as potential antecedents of a manufacturer's private brand retailer dependence while adopting private brand sales growth and returns from private brand production as outcomes using a sample of 153 South Korean manufacturers currently involved in private brand production. The results show that the private brand retailer dependence of a manufacturer leads to private brand sales growth directly and returns from private brand production indirectly through private brand sales growth, and has a negative effect on return from private brand production directly. Furthermore, product characteristics, such as product innovativeness through collaboration with retailers and search goods, and market characteristics, such as high retailer power and knowledge specificity of a retailer, increase a manufacturer's private brand retailer dependence and, therefore, private brand sales growth. The theoretical and managerial implications of the findings are discussed at the end.     

Enhancing Consumers' Affection for a Brand Using Product Design

Product design is an integral component of a brand and an important driver of brand equity. For the brand, product design is an important tool for driving differentiation, creating value for both the consumer and the firm, driving consumer preferences, and creating a sustainable competitive advantage. At the firm level, the importance of investing in design has been substantiated by studies that suggest firms capable of creating innovative design and providing superior consumer value perform better in the marketplace. Thus, product design clearly presents an important area of research for those studying and managing brands. In this context, the goal of this research is to explain the brand‐level affective outcomes that product‐level design features can create. This paper develops a conceptual framework and hypotheses that theoretically connect design‐based values, at the product level, to affective brand‐level relational outcomes with the brand. The drivers of product affection include social value, altruistic value, functional value, emotional value, and economic value. Analogous to “firm affection,” the paper postulates a brand affection construct that is defined as the passion and pride that a consumer feels about owning a brand. Using syndicated product‐level data from the automotive industry collected from a national sample of consumers, 712 useable consumer/product observations of 30 small vehicles are employed in the analysis. A confirmatory factor analysis and structural equation model are developed to test the conceptual model. This research finds that the social value and emotional value that a design provides to consumers have a greater effect on brand affection than purely transactional values, such as functional value or economic value. This research contributes to the literature by providing evidence that product design‐related values are multifaceted and can contribute to relational outcomes, such as brand affection. It contributes to practice by highlighting the means by which design can be used as a strategic tool to create a sustainable long‐lasting relationship with the consumer, and provides managers with a framework to assess the impact of design‐based values on long‐term relationship‐based outcomes. The results provide new insights about how consumers' perceptions of the value of product design at the product level can help create enduring relationships with brands.     

Reinventing a business model in industrial networks: Implications for customers' brand perceptions

Although researchers recognize the need for established market-centered business models that address and satisfy consumer's needs, little research has been done on the link between a customer's perception and a business model innovation (BMI). We addressed this research opportunity by conducting a case study encompassing 394 respondents to explore how a BMI affects customers' brand perceptions, distinguishing between their brand trust, brand loyalty, and brand equity. We conceptualize a BMI from an industrial network perspective and decompose the effect of different BMI dimensions: value offering innovation (VOI), value architecture innovation (VAI), and revenue model innovation (RMI). Our results show that a VOI has a positive impact on brand equity and a negative impact on brand loyalty. Further, a VAI has an inverted u-shaped relationship with brand trust, whereas an RMI has a positive impact on brand trust. In turn, brand trust fully mediates the relationships between an RMI and brand loyalty and an RMI and brand equity. Our insights contribute to BMI research from a customer-centric perspective. In particular, we extend our knowledge of BMIs by offering a more granular understanding of how different BMI dimensions affect a customer's brand perceptions. We contribute to industrial networks literature by offering rich and novel insights to purposefully manage an industrial network's BMI.     

How strong is the business-to-business brand in the workforce? An empirically-tested model of ‘internal brand equity’ in a business-to-business setting

In the business-to-business sector, the brand-owner's employees are increasingly playing a key role in the representation of individual and corporate brands at the interface with actual and potential customers. Consequently, ‘internal branding’ has recently emerged as an important issue in industrial markets. This article proposes and empirically validates a theoretically structured framework for the measurement of a new construct, internal brand equity, and identifies its determinants and consequences. The findings offer evidence for the powerful impact of a brand-oriented corporate culture on internal brand equity, and demonstrate its relationship to external brand equity. Conclusions are drawn for management practice and future research.     

A literature review and future agenda for B2B branding: Challenges of branding in a B2B context

The existing body of research knowledge on brand management has been predominantly derived from business-to-consumer markets, particularly fast moving consumer goods and has only recently started to expand in other contexts. Branding in business-to-business markets has received comparatively little attention in the academic literature due to a belief that industrial buyers are unaffected by the emotional values corresponding to brands. This paper provides a critical discussion of the fragmented literature on business-to-business branding which is organized in five themes: B2B branding benefits; the role of B2B brands in the decision making process; B2B brand architecture; B2B brands as communication enablers and relationship builders; and industrial brand equity. Drawing on the gaps and contradictions in the literature the paper concludes by proposing an agenda for future research.     

Assessing Consequences of Component Sharing across Brands in the Vertical Product Line in the Automotive Market

Component sharing may look great in the boardroom but not in the showroom. Indeed, savings on research and development and production costs could be offset by a plunge in customer brand attractiveness. The central objective of this paper is to investigate consumer and market responses toward component sharing between brands. More specifically, by combining experimental with econometric studies, this paper investigates the impact of component sharing on customer evaluation of luxury, volume, and economy brands offered in a car manufacturer's vertical product line. An experimental study in which component sharing between automotive brands was made explicit aimed to understand the impact of brand combinations and type of sourcing on the evaluations of the two brands sharing components. This experimental study shows that the evaluation of luxury brands sharing with a volume brand suffers more than when a volume brand shares components with an economy brand. This experimental study was executed for two different brand combinations including one luxury, one volume, and one economy brand: (1) Audi, Volkswagen, and Skoda; and (2) Lexus, Toyota, and Suzuki. The evaluation of an economy brand benefits more from sharing with a volume brand than a volume brand suffers from sharing with an economy brand. The magnitude of these effects depends on several factors, such as component type, the source of the component sharing, and the salience of component sharing to the consumers. One important limitation of the experiment is that component sharing is made rather salient, and no behavioral effects of component sharing are studied. Therefore, a second was executed in which market share data on brands of the Volkwagen company (i.e., Audi, Volkswagen, Seat, and Skoda) were collected, while also data on the component‐sharing practices between these brands were gathered. A market share model was estimated in which market shares of the four studied brands were explained by component‐sharing practices and some control variables (i.e., price, model changes) in an exploratory fashion. The explorative examination of market share effects confirms that luxury brands may suffer, while economy brands may benefit from component sharing. In sum, this research suggests that component sharing between brands has negative effects for the higher‐end, and positive effects for the lower‐end brand. However, it also shows that sourcing matters. This study is considered as the first study investigating the phenomenon of component sharing, and it points to multiple future research issues, such as studying this phenomenon in other markets.     

To invest, or not to invest, in brands? Drivers of brand relevance in B2B markets

When allocating resources to brand investments, managers should consider the relevance of brands to the purchase decision process. Past research on consumer markets shows that brand relevance generally is driven by three functions: image benefits as well as information cost and risk reductions. This study is the first to investigate these underlying mechanisms of brand relevance in a business-to-business setting. Our main contribution is that, in contrast with consumer markets, brand relevance in industrial markets depends primarily on risk and information cost-reducing effects. Therefore, business-to-business firms should invest in their brands using tactics that support the reduction of risk and information search costs for customer decision making. This article also demonstrates that brand relevance differs across product categories, such that depending on the specific category, investing in brands may or may not be a promising strategy.     

An exploratory investigation of the elements of B2B brand image and its relationship to price premium

Much of the extant work on brand equity in business markets has focused on predicting brand loyalty, as in what brand image elements that make buyers prefer to buy a brand. The question what drives buyers to pay more or less for brands has however been somewhat overlooked, despite price premium being a distinct and economically important outcome of a favourable brand image. In an attempt to answer this question, this paper suggests that the corporate brand image determinants of price premium can be conceptualised into six dimensions: brand familiarity-, product solution-, service-, distribution-, relationship- and company associations. Findings from a small-scale qualitative investigation, based on interviews with buyers of corrugated packaging, are used to illustrate this model as well as to explore its microelements and demonstrate why they can be assumed to be mentally related to buyers' willingness to pay.     

A framework of brand value in B2B markets: The contributing role of functional and emotional components

The creation of value is admittedly a critical task for marketers regardless of industry. This paper focuses on a type of value that has traditionally been perceived as irrelevant to industrial markets and argues that brand value facilitates the progression from goods and services value to relationship value. To address the limited amount of research on B2B branding from the suppliers' point of view, we complement insights gained from a literature review with ten exploratory interviews with B2B supplier managers, and develop a framework of brand value applicable to industrial markets. This identifies both the functional (i.e., quality, technology, capacity, infrastructure, after sales service, capabilities, reliability, innovation) and emotional qualities (i.e., risk reduction, reassurance, trust) important for the development of industrial brand equity. Situational (e.g. nature of the purchase) and environmental factors (e.g. the economic situation) affecting suppliers' perceptions of the importance of brand in a B2B context and the role of functional versus emotional brand qualities are discussed. The value of the brand as a driver for the development of business to business relationships is also highlighted. The framework provides a basis for B2B practitioners to build their brands in such a way as to make a functional as well as an emotional connection with buyers that is more likely to lead to a supplier–buyer relationship.     

Product Hierarchy and Brand Strategy Influences on the Order of Entry Effect for Consumer Packaged Goods

Manufacturers focus on becoming more agile, software firms deploy rapid application development tools—everyone is in a hurry. Although we all understand the benefits of being first to market, we understand just as clearly that not all first-to-market products enjoy the same, sustainable benefits from being market pioneers. Why do some pioneering products experience a more significant order-of-entry effect than others? Roger A. Kerin, Gurumurthy Kalyanaram, and Daniel J. Howard examine two factors–product hierarchy and brand strategy—which may influence the magnitude of this effect for new consumer packaged goods. First, they hypothesize that pioneering a new product class offers a greater advantage than introducing a new form to an existing product class. Second, they predict that the order-of-entry effect will be greater for brand extensions than for entirely new brands. Finally, considering both product hierarchy and brand strategy, they expect that the order-of-entry advantage for brand extensions over new brands will be significantly greater within new product classes than for new forms of existing products. These hypotheses are tested using data from the Information Resources, Inc. Behaviorscan° data set. Collected from 2,500 household panel members, 75 supermarkets, and 25 drugstores, this database contains weekly measures of brand trial penetration as well as brand distribution, price, and promotion information in eight geographic markets from the period 1983–1988. The models developed in this study explore the relationships among brand trial penetration, product hierarchy, brand strategy, order of entry, lag time between successive brand entrants, and marketing mix variables (i.e., price, promotion, distribution, and advertising). The study strongly supports all three hypotheses. In particular, the analysis clearly demonstrates that the order-of-entry effect is greatest for a new product class pioneered by a brand extension. Order of entry has the least effect on a new product form pioneered by an entirely new brand. For a company seeking a competitive advantage from being first to market, innovation in product function offers greater potential benefit than innovation in product form. Such a company can also benefit from building on the name and reputation of its established brands. Although the study finds these order-of-entry effects significant, the effects of marketing mix variables such as product price and promotion are consistently stronger.     

Experience as a moderator of involvement and satisfaction on brand loyalty in a business-to-business setting 02-314R

This paper examines the relative influence of two key antecedents of brand loyalty—satisfaction and involvement and the moderating role of experience, using a sample of business buyers. The central argument of this paper is that the strength of the effect of these variables on attitudinal brand loyalty will vary with the level of customer experience with purchasing the service. Building on previous research which examined low-risk, customer product settings [Kim, J., Lim, J.S., & Bhargava, M. (1998). The role of affect in attitude formation: A classical conditioning approach. Journal of the Academy of Marketing Science 26 (2): pp. 143-152; Shiv, B., & Fedorikhin, A. (1999). Heart and mind in conflict: The interplay of affect and cognition in consumer decision-making. Journal of Consumer Research 26: 278], this study shows that for a high-risk setting, involvement with the service category will be more dominant in its influence on brand loyalty than satisfaction with the preferred brand. Furthermore, it was found that experience moderated the influence of involvement and satisfaction on attitudinal brand loyalty for a high-risk business-to-business service. This study provides new insights into the theory and practice of buyer behavior and business-to-business brands.