Industrial Ingredient Co-branding: A Brand Relationship Approach

Daniela Andreini,Jari Salo,Giuseppe Pedeliento,Mara Bergamaschi

doi:10.5539/ijbm.v11n7p23

Abstract

<p>Existing research on industrial ingredient co-branding alliances has largely focused on the functional and<br />transactional value that ingredient brands provide to ingredient buyers and sellers. The current research draws on the brand relationship perspective to investigate how the relational assets of ingredient brands generate value for both ingredient buyers and for the ingredient supplier itself. For the former, such value manifests in ingredient co-branding value, and for the latter, the value lies in brand equity. The results are derived from a survey of 107 ingredient buyers from a multinational ingredient manufacturer aiming to initiate ingredient co-branding agreements in the energy component industry. The results of the structural equation model reveal that ingredient brand trust directly affects both ingredient brand loyalty and ingredient co-branding value, but indicate no significant effect between brand loyalty and ingredient co-branding value. Moreover, ingredient co-branding value proved to be a driver of ingredient supplier brand equity.</p>

Highlights

The local subsidiary of the ingredient supplier provided researchers with a database of 343 decision makers who were prospective partners for an ingredient co-branding relationship with the company. We focused on this population, which was potentially interested in an ingredient co-branding alliance, but had not signed any formal agreements at that stage
This research, in utilizing the theories of the resource-based view and brand relationship contributes to the ingredient co-branding literature by identifying and highlighting the role of the relational assets of the ingredient brand in creating value both for buyers and sellers, in terms of a stronger competitive advantage for the ingredient buyer, and higher brand equity for the ingredient supplier
We found that the ingredient brand strength affects the ingredient brand trust, indicating that the strong image of the ingredient brand, being a signal of quality, affects the brand trust in an industrial context (Doney & Cannon, 1997; Kirmani & Rao, 2000; Nelson, 1974; Rao & Ruekert, 1994; Singh & Sirdeshmukh, 2000)

Summary

Introduction

Current research on ingredient co-branding has adopted functional and transactional perspectives to explain how allied brands create value both for ingredient buyers such as original equipment manufacturers and sellers (Bengtsson & Servais, 2005; Erevelles et al, 2008; Ghosh & John, 2009; McCarthy & Norris, 1999; Pfoertsch, Linder, & Chandler, 2007). These prior studies investigate the ability of buyer and seller brands to provide reciprocal benefits in a co-branding alliance. The ingredient co-branding studies available to date have underestimated the relationship that industrial actors ( buyers) establish with brands, which is the focus of the brand relationship perspective (Chaudhuri & Holbrook, 2001, 2002; Delgado-Ballester & Munuera-Alemán, 2005; Han & Sung, 2008; Nyadzayo, Matanda, & Ewing, 2011; Van Durme, Brodie, & Redmore, 2003)

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