Co-Branding on Industrial Markets

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Article #25 – Co-branding on Industrial Markets
By Anders Bengtsson, Per Servais
Presented by: Tracy Cessna

Co-branding: co-operations between two or more marketable items that in one way or another connect representations of several brands in the marketplace. ("Co-branding on industrial markets")

1. Who are the authors?

Anders Bengtsson is an assistant professor of marketing at Suffolk University's Sawyer Business School in Boston, Massachusettes. He received his Ph.D. and M.Sc. (Specialist Masters Degree) at Lund University, the largest institution for education and research in Scandinavia. His areas of expertise include: brand strategy, consumer culture theory and consumer brand relationships. He has written a number of articles on co-branding: "When Hershey met Betty" (2004) and "Co-branding and the impact on inter-organizational relationships". He is a member of the Association for Consumer Research and speaks Swedish, Danish, English and German fluently. (Suffolk University)

Per Servais is an Associate Professor of Marketing at the University of Southern Denmark. He received his Ph.D. in international marketing from Odense University in Denmark. Similarly, he received his M.Sc. in International Business Administration from Aalborg University in Denmark. His areas of expertise include: international marketing, business-to-business marketing and global sourcing. He has written many books and articles related to these topics. His "Born Global or Gradual Global? Examining the Export Behavior of Small and Medium-Sized Enterprises" is one of the most cited articles in International Marketing according to the American Marketing Association. (Marketing Power)

2. What is the authors' message?

While it has not been fully realized in industrial marketing, co-branding can be a good strategy to increase value and competitive advantage.

Bengtsson & Servais' Point:

Until recently, brand management has been focused on consumer marketing. While there are similarities in consumer marketing and business-to-business (B2B) marketing, there are still several key factors that need to be addressed differently in B2B marketing. One key factor that is presented in this article is the difference in the buying process. In B2B marketing the buying process is much more complex and involves more decision makers.

3. What evidence is offered to support this theme? (All quotations are taken from "Co-branding in industrial markets")

A."Co-branding may also have effects on the perceived quality of the product." According to a study conducted by Rao et al. (1999), the quality of a product may be enhanced when a second brand is added to the product that consumers have no previous experience with. Similarly, McCarthy and Norris (1999) conducted a study indicating, "Consumers evaluate a low quality host brand more favorably when a high quality host brand ingredient is added." The high quality brand may not benefit in the same way as the low quality brand, but it is still beneficial to enter a co-branding relationship. The DEVI/JUNCKERS co-branding case is a good example in this instance. JUNCKERS, which was identified as the stronger brand, benefited from co-branding by gaining the trust of buyers and dispelling the myth of incompatibility of wooden floors and floor heating.

Point: While the low quality brand is viewed more favorably, the same cannot always be said for the high quality brand. Yet, it can still be beneficial to the high quality brand to co-brand. B."…growing interest (in brand management) was partly due to the success of some large and very well known companies whose main asset was their brand name." Brand strategy has become increasingly important. In today's business environment, almost all firms have access to the same technologies, forcing competition to be based on more than just product attributes.

Point: Co-branding can help a company...
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