The importance of branding in industrial markets
Mudambi, Susan McDowell (1998) The importance of branding in industrial markets. PhD thesis, University of Warwick.
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Official URL: http://webcat.warwick.ac.uk/record=b1365274~S1
Demonstrations of the power of branding in consumer markets reverberate
around the globe. In contrast, the role of branding in industrial markets is
unclear and under-researched. Three basic questions stimulate the thesis: (1)
What is industrial branding?; (2) Is industrial branding important, and if so, to
whom?; and (3) What are the implications of industrial branding for managers?
Industrial branding is the process of increasing the meaningful differentiation of
an industrial product by developing added values or benefits of the brand and
communicating them to the customer. The thesis introduces a continuum of
industrial brands from commodities to independent brands. Functional benefits
form the foundation of value, yet industrial branding emphasises that intangible
and emotional values can also affect the choices customers make. Successful
branding engineers a close fit between the benefits desired by customers and the
tangible and intangible features of the brand. The pinwheel of brand value to the
industrial customer captures the dynamics of the situation.
Most previous research examines branding from the seller's perspective. Instead,
the thesis utiises in-depth interviews to gain insights into the perceived benefits
of branding to the buyer. Then, two extensive surveys of UK industrial buyers
contribute to knowledge by successfully measuring the importance of branding in
specific product markets (bearings and circuit-breakers).
Analysis of the survey data reveals that branding is important, but not to all
buyers or in all situations. The data are used to test hypotheses emanating from a
preliminary new model of industrial branding in the purchase decision process.
Cluster analysis is used for benefit segmentation, the grouping of customers by
the perceived importance of choice criteria or attributes. The relative importance
of branding is a significant factor in the creation of three buyer clusters. Firms in
the branding receptive cluster highly value branding attributes such as how well
known the company is, the company's general reputation, and the number of
prior purchases from the company. Firms in the high tangibility cluster value
tangible attributes such as physical product properties and price most highly, and
branding least highly. Firms in the low relevancy cluster show low interest in the
purchase and rate all the attributes relatively low in importance.
Previous research has shown the difficulty of linking benefit segments to more
accessible characteristics. However, in the thesis, attribute importance of firms
in the three segments is related to a number of buyer, purchase, and decision
process characteristics. Branding importance is related to aspects such as buyer
expertise, perceived risk, and the level of involvement in the decision process.
Finally, the thesis offers suggestions for adjusting the marketing mix for buyers
in each of the clusters. These recommendations recognise that segmentation
analysis is only as good as how well it can be utilised by the sales force.
Overall, the thesis provides evidence of the power of industrial branding, and
helps explain its importance. For a significant portion of buyers, the purchase
decision comes down to the relatively intangible attributes of the company brand.
Despite this, the potential of industrial branding remains relatively untapped.
|Item Type:||Thesis or Dissertation (PhD)|
|Subjects:||H Social Sciences > HD Industries. Land use. Labor
H Social Sciences > HF Commerce
|Library of Congress Subject Headings (LCSH):||Branding (Marketing), Industrial management|
|Official Date:||July 1998|
|Institution:||University of Warwick|
|Theses Department:||Warwick Business School|
|Supervisor(s)/Advisor:||Doyle, Peter, 1943-2003 ; Wong, Veronica|
|Extent:||xvii, 364 leaves|
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