This article explains the concept of brand equity in a specific industrial

marketing setting.
Studies do point out cases where price and the hard tangible factors of
the physical product do not fully explain the purchase decision.

The purpose of this study:

To explore the existence of brand equity in a specific business-tobusiness product setting;
To investigate the sources of brand equity and its appropriate
communication channels;
The relative importance of brand relative to other purchase decision
criteria.

BRAND
A brand is a name, term, sign, symbol, or design, or a combination of
them intended to identify the goods and services of one seller or group
of sellers and to differentiate them from those of competition.
BRAND EQUITY
Brand equity is the added value that endowed to products and services.
This value may be reflected in how consumers think, feel, and act with
respect to the brand, as well as the prices, market share and profitability
that the brand commands for the firm. Brand equity is an important
intangible asset that has psychological and financial value to the firm.

Aaker (1996)

Keller (1998)

LOYALTY

AWARENESS
ASSOCIA
TIONS

BRAND
EQUITY

PERCEIVED
QUALITY

AWARE
NESS

IMAGE

BRAND
EQUITY

 The competitive advantage of firms that have brands with high equity

include the following:

a. A price premium can be attained

b. Increased demand by customers
c. Brands can be extended easily
d. Communications will be more readily accepted
e. There will be better trade leverage
f. Larger margins could be obtained
g. The company will be less vulnerable to competitive marketing
actions
More recent studies found that branding in the business-tobusiness sectors were successful

 Intangible aspects include factors :

Perceived quality,
Incomplete or conflicting information about the product,
Ease of ordering,
General reliability,
Willingness of the company to respond in an emergency,
Service quality,
Degree of rapport between customers and service providers,
Understanding between service providers and customers,
Company reputation,
Country of origin,
Pleasantness,
Trustworthiness of company personnel

P1: Brand equity exists in business-to-business markets

in the form of buyers willingness to pay a price
premium for their preferred brand (Hutton, 1997).
P2: Benefits from brand-loyal industrial buyers include their
willingness to recommend the brand to peers and to give
special consideration to another product with the same brand
name (Hutton, 1997).

P3: Perceived quality is the primary brand-equitygenerating variable (Michell et al., 2001)
P4: The primary source of information for building
brand awareness are exhibitions and trade shows
(Abratt, 1986).
P5: Different groups of decision-making unit role players
attach different levels of importance to brands and prefer
different communication channels (Ghinghold & Wilson,
1998).

The method used to gather information for this study

was a conjoint analysis experiment supplemented with a
self-administered questionnaire.

Conjoint analysis establishes the importance of features,

the utility of each level of each feature, and the preferred
option for each respondent.

METHODOLOGY
1. Selection of
the field of
experiment
The objective of the first
part of the study was to
explore empirically the
existence of brand equity in
a specific business-tobusiness product setting.

2. Derivation

of variables

The research was

conducted in two separate
stages: the first stage was
qualitative. It aimed at
deriving the variables
needed for use in the
second stage of data
collection.

3. Conjoint

analysis
experiment
Data for conjoint analysis
were collected during face
to face interviews.

METHODOLOGY
4. Methodology
for the halo
effect
One of the issues that
this research
investigated was
whether the goodwill
that certain brands
enjoy in their current
product lines could be
extended to new
product lines.

5. Population

6. Sample

The minimum sample

The population
size to be chosen took
consisted of decision
into account the
making unit (DMU)
requirement for
members of industrial
conjoint analysis (at
companies in South
least 30) and for
Africa that purchase
KruskallWallis (at
medium voltage
least five in each DMU
electrical equipment.
role).

METHODOLOGY
7.Questionnaire construction
The questionnaire was divided into five parts:
1.Part was designed to record the results of the conjoint analysis
experiment.
2.Consists of four questions designed to determine the
respondents demographic characteristics.
3. Investigate the possibility of extension into a new product line
where none of the brands was active in the South African market.
4. investigated the source of brand equity,
5. The questionnaire investigated the means of creating brand
awareness and the willingness of respondents to recommend their
preferred brands.

METHODOLOGY
8. Data collection details
Data collection took place during the same face-to-face
session as the conjoint analysis. Together with the conjoint
analysis cards, each respondent was given a copy of the
questionnaire and one envelope in which to seal the
answers.

RESULT
There were 57 respondents that participated in the conjoint analysis
experiment and the questionnaire. 3 respondents were disregarded due
to errors they made in recording their conjoint analysis experiment.
The 54 remaining respondents were used in the analysis.

Table 1
Shows the profile of respondent. All the respondents had more than 3
years of professional experience. 69 % had nine or more years
experience. All the respondents had a technical or commercial and/or
a financial background People from technical backgrounds were also in
the majority among decision makers while the others were mainly
buyers and gatekeepers.

RESULT
Table 2
MONANOVA was used to calculate the utilities of the various
levels of the different features.
Figure 1
The relative importance of features was calculated from utilities.
Delivery Period at 27%
Price at 24%
Technology at 19%
Brand at 16%
Spare parts at 14%

RESULT
Table 3 shows the utility ranges, total utility, and relative importance of

attributes.
Table 4 shows the relative importance of attributes per role player category.
Table 5 contrasts the utility enjoyed by each of the brands with the
willingness to consider new products bearing the same brand name.
Table 6 shows the raw scores for the selection of ones preferred brand.
Respondents were asked to rate the importance of nine attributes on a Likert
scale from 1 to 5, where 5 = very important and 1 = not important.
Table 7 rank the use of technical specialists as the most effective means of
promoting a new brand.
The second column in Table 7 (total score) indicates the sum of scores
collected by each medium of communication. Columns 3 to 7 represent the
median value of scores collected by each medium of communication.
All the members of the buying center indicated their willingness to
recommend their preferred brand. Decisionmakers and gatekeepers give a
rating of 5, buyers 4.5, and users and technical specialists gave a 4 on the fivepoint scale.

RESULT

RESULT

RESULT

RESULT

DISCUSSION
1.

2.

3.

4.

4.
5.
6.
7.
8.

Importance of price and delivery

Price and delivery are very important. Delivery period came out as a more important
attribute than price because of the wider range of variation specified for this attribute.
Importance of brand name
Conjoint analysis results indicated clearly that the brand name was not the most important
attribute (save for the technical specialists)
Price premium for certain brands
the brand leader could afford a price premium 14% over relatively unknown brands on the
market.
Impact of technical specialists on price premiums
on industrial buying in hightechnology markets demonstrated that technical personnel
dominated the buying process and that the involvement of the buying department was
primarily administrative.
Differences in perception of brand-name importance among DMU role players
The halo effect: possibility of brand extension into new product lines
Perceived quality as a brand-generating variable
Price
Promotion of a new brand

DISCUSSION
Proposition 1 : Brand equity exists in the business-to-business

markets, in the form of buyers willingness to pay a price premium for

their favorite brand.
Proposition 2 : Other benefits from brand-loyal industrial buyers
include their willingness to recommend that brand to peers and give
special consideration to another product with the same name.
Proposition 3 : Investigated the principal brand-equity generating
variable.
Proposition 4 : examined the best means to create brand awareness
among potential customers.
Proposition 5 : was concerned about differences across role players
in the DMU in relation to perceptions of brand importance and
preferred channel of communications.

DISCUSSION
This study shows that in B2B marketing:
Industrial marketers have something to gain by investing into building a likeable,

strong, and positive brand image among all stakeholders. It will allow the company
to reap (albeit to a lesser degree) the same benefits that consumer marketers
enjoy.

Quality is the main brand-equity-generating variable. Two lessons derive from this

finding. The one is that a quality claim may be effective only if there is substance
to the claim. Industrial marketers have to make sure their efforts to build a
positive brand image are not torn down by poor quality. The second lesson is that
to create a quality product is not enough. Industrial marketers have to translate
quality into perceived quality.

Industrial customers deliberately make it difficult for suppliers to determine who

is actually making the buying decision. Therefore, industrial marketers must create
a positive image to all stakeholders that come into contact with the company. To
achieve this, the supplier company must look beyond marketing communication
and develop a total corporate communication program to build up the corporate
brand.