The role of brands in B2B
Midterm Paper:
What role do brands (or ingredient brands) play in business markets?
12/03/12
Branding has always been more acknowledged in consumer markets than in business markets. The latter has not received much attention in terms of the influence of brands on decision-making process because of the complexity of its environment. In B2C, products are more standardized, mass marketing is used and the relationship between buyer and seller is impersonal. On the other hand, B2B uses a more personal relationship between the buyer and salesperson, decisions are made by a group of members, products are more complex and customized and therefore rely on personal selling for their communication. Rather than end consumers, the focus of B2B is to understand and meet the needs of other businesses. According to de Chernatony & McDonald’s (2003): a brand is a cluster of functional and emotional benefits that extend a unique and welcomed promise. While some studies found brands to cause confusion for buyers in business markets (Saunders & Watt, 1979), more recent ones suggested that brands play a fundamental role in the decision making process and should be considered amongst the different attributes that influence purchase decisions (Sweeney, 2002; Mudambi, 2002). As one manager interviewed in Mudambi’s (2002) study said, “Branding may not be important to everyone, but as long as it is important to some of our customers, we want to know about it”. Hence, the role of brands in business markets has varied greatly in the past years and its degree of importance is constantly changing. This is mainly the consequence of the increased competition in business markets and the need to differentiate. Other changes in the business environment, which have lead to the higher interest in B2B branding, are the increase of the homogeneity of product quality and the decrease of personal relationships due to digital communications
What role do brands (or ingredient brands) play in business markets?
12/03/12
Branding has always been more acknowledged in consumer markets than in business markets. The latter has not received much attention in terms of the influence of brands on decision-making process because of the complexity of its environment. In B2C, products are more standardized, mass marketing is used and the relationship between buyer and seller is impersonal. On the other hand, B2B uses a more personal relationship between the buyer and salesperson, decisions are made by a group of members, products are more complex and customized and therefore rely on personal selling for their communication. Rather than end consumers, the focus of B2B is to understand and meet the needs of other businesses. According to de Chernatony & McDonald’s (2003): a brand is a cluster of functional and emotional benefits that extend a unique and welcomed promise. While some studies found brands to cause confusion for buyers in business markets (Saunders & Watt, 1979), more recent ones suggested that brands play a fundamental role in the decision making process and should be considered amongst the different attributes that influence purchase decisions (Sweeney, 2002; Mudambi, 2002). As one manager interviewed in Mudambi’s (2002) study said, “Branding may not be important to everyone, but as long as it is important to some of our customers, we want to know about it”. Hence, the role of brands in business markets has varied greatly in the past years and its degree of importance is constantly changing. This is mainly the consequence of the increased competition in business markets and the need to differentiate. Other changes in the business environment, which have lead to the higher interest in B2B branding, are the increase of the homogeneity of product quality and the decrease of personal relationships due to digital communications
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