Article: Leek, S. & Christodoulides, G. (2011). A framework of brand value in B2B markets: The contributing role of functional and emotional components. Industrial Marketing Management, 41(2012), 106-114.
Summary and critique of the article
This article focuses on the value of a brand as a driver of business to business relationship. In this kind of brand value, functional and emotional connections with buyers most likely lead to supplier-buyer relationship, hence the concept of relationship value. This paper defines functional components to include quality, technology, capacity, infrastructure and innovation among other components. Emotional qualities include risk reduction, reassurance and trust. According to this article, functional and emotional components are vital for the development of industrial brand equity. Sleek and Christodoulides (2011: 106-114) also focus on situational factors such as risk and environmental factors such as economic conditions.
This article has considered previous research in its literature review section and has highlighted mixed views about the various aspects of brand value. For instance, the definition of brand equity is given to be ‘an intangible market-based rational asset that bonds firms with customers’ (Christodoulides & de Chernatony, 2010: 43-46). In regards to functional and emotional components of B2B brands, this article refers to the suggestion of Kuhn et al. (2008: 40-58). They suggest that the functional qualities of a product predominantly affect the value of a B2B brand. According to this article, research also shows that emotional qualities lead to B2B brands. Jensen and Klastrup (2008: 122-128) argue that brand relationship of customers is dependent on the rational and emotional aspects of the brand. It is also indicated here that the functional aspects of brand value are more superior to the less tangible emotional components.
This study further gives significant literature review to reinforce their argumentative proposition that the influence of situational and environmental aspects on B2B brand value is profound. For instance, customers prefer to consider the brand in high risk situations than in low risk situations (Bennet et al, 2005: 97-107). The nature of a product may also make some customers to be more attached to some emotional brands than others.
The findings of this paper indicates that there are mixed views on the importance of branding to B2B situations. For instance, among ten exploratory interviews carried out, the sales manager of company A considered branding as an essential component f his business model. A well established brand provides a substantial competitive advantage and serves as a source of barrier to entry (Michell, King and Reast, 2001:415-425).
In this study, quality is regarded as the most vital functional aspect of the brand by most of the interviewees. This reinforces the study of Bendixen et al (2004: 371-380). This research postulates that companies need to provide quality to customers so as not to damage their perceived brand value. The other functional features of brand value identified in this study also include capacity and capability as suggested by one of the interviewees. Other interviewees also cited good technology and innovation as crucial functional brand elements to their customers. According to the findings of this study, after sales service is also a crucial functional brand attribute to buyers. The extensive provision of after sales services immensely contributes to creating an effective brand value. In this research, innovation is considered as a vital functional component, though it has not been mentioned in previous research.
Through the managers’ interview, this article has found out that the rational features of decision making is no longer the only aspects focused by B2B buyers; emotional qualities have also become apparent. The buyers will buy a brand that conveys the aspects they require. They do not take risks by purchasing a brand that is unknown to them and that which doesn’t carry the requisite qualities. Therefore, this article explains that companies assures their buyers of emotional safety and reduces their potential risk.
This article further provides a link between functional elements and emotional elements of a brand. For instance, one of the interviewed companies provides an after sales service which gives buyers an assurance that in case something unanticipated happens, they will be taken care of. Furthermore, trust can also be partially provided through sufficient functional elements (Jensen & Klastrup, 2008: 122-128). The linkage between functional and emotional aspects has the impact of reducing perceived risks.
Situational and environmental factors are also considered to affect the perceptions of brand value. One of the situational factors which influences brand value is the nature of the product. One of the managers interviewed concurs with this proposition by saying that the emotional components of the sale is important when the sold products have little to do with technology and competition is immense. Environmental factors are also considered by this article to be one of the influencing factors in the managers’ perceptions of the functional elements and the value of brands.
This article has two weaknesses. First, it has used a small number of companies in their interview. This has made its argumentative grounds to be shallow. Although this article has given sufficient literature to support its proposition, the methodology used is found to be rather compromising and does not cover all aspects of the topic. For instance, this article presupposes that functional and emotional aspects are linked to each other, and that functional aspects are superior to emotional aspects, yet it does not sufficiently give evidence from the interviews to support this argument. Secondly, this article clearly indicates that innovation has not yet been proved by any previous research as a functional attribute of a brand. On the other hand, it uses a suggestion of one manager to give this proposition, which is in fact shallow.
Discussions of findings
From the selected article, it is evident that functional and emotional components contribute to the creation of brand value. This is in line with the coursework material provided in Waters & Rainbird (2012: 1-43). In this material, management of organization is mostly centered in value chain management which aims at designing and controlling the entire network of all business partners so as to provide superior customer value. This is reflected in our feature article as creation of brand value for the customers. These value chains, also known as networks, are based on relationships, knowledge, and technology as given in our feature article as functional component of brand value.
Christodoulides (2011: 106-114) suggest that innovation is part of the functional components that create value to customers. It is also clear in our course material that businesses innovate by transforming ideas, knowledge and technology into competitive products. This enhances increased productivity and value addition. A company uses various value drivers to ensure that value is created for the customers. Some of these value drivers include product mix, manufacturing and distribution capacity, employee motivation, supply chain configuration and excellent customer service. These cost drivers are the functional and emotional components of brand value as specified in our case study article. These drivers contribute to the company’s achievement in creating brand value for its customers.
The coursework material also provides key marketplace drivers for a successful brand value creation. Such industry value drivers are: knowledge management, technology management, process management and relationship management. In this section, we will only limit ourselves to relationship management and technology management form part of our coursework and the article in question. In the article, relationship management and knowledge management are both functional components that contribute to brand value (Jensen & Klastrup, 2008: 122-128). In the course study work, the same applies. Relationship management in this case influences the positioning and strategies of organizations in such a way that they may meet customer’s expectations and gain a good competitive footage. Technology management involves the integration of process and product technology into capabilities to meet the overall objectives of an organization.
Generally, functional and emotional compositions of a company create value for its customers as much as market value drivers in our course work give an opportunity for organizations to meet customer satisfaction.
