THE IMPORTANCE OF BRAND IN THE PURCHASE DECISION OF B2B PRODUCTS: A STUDY OF SELECT CONSTRUCTION EQUIPMENT BRANDS IN ANDHRA PRADESH

Research Synopsis by: BHARATHANAND.S.K REG NO: 270720031

Submitted for: Admission to Doctorate in Philosophy Program (Ph.D) In Aligarh Muslim University, Aligarh

INTRODUCTION
The basis for above-average corporate performance in business and industrial marketing is a significant competitive advantage (Porter, 1985). Organizations base their competitive advantage on tangible assets such as manufacturing facility, some on their employees, and some on their channel network (Kotler, 2000). Many others however seek to attain a competitive advantage from intangible assets such as their reputation or the brands that they own (Beverland, 2005; Keller 1993; Low and Blois, 2002). Brands differentiate, reduce risk and complexity and communicate the benefits and value a product and service can provide. This is just as true in B2B as in B2C (Kotler and Pfoertsch, 2006). A recent published list of Best Brands of 2010 by interbrand not only includes Coca Cola, MC Donalds and Disney, but also includes some of the renowned B2B brands such as Caterpillar, Intel, SAP, Siemens and GE. In the Indian context, TATAs could visualize the power of B2B branding. On February 27, 2003, TATA STEEL launched the worlds first branded cold rolled steel (CRS) called TATA Steelium in Goa. Speaking at the launch, Mr.B.Muthuraman (exManaging Director, Tata Steel), said Branding will give rise to a customized product in terms of value, performance and pricing that will meet our customers needs better. Branding will go a long way in meeting the challenge of gaining a sustainable competitive edge. It will add value to the product and help in highlighting it in the otherwise fragmented market for cold-rolled steel. The results of branding steel were much evident in the market share achieved over a period of time by TATA.

There are a number of characteristics that are suggested to differentiate industrial markets from consumer markets: fewer, larger buyers; more people involved; closer buyer-seller relationships; products often need customizing to customers needs; extended negotiations; greater loyalty; more rational buying behavior; better informed buyers; existence of second hand markets (De Chernatony and Mc Donald, 1998; Kotler, 2000). Personal goals of buyers; New features; Compatibility with future purchases; minimizing the inventory by procuring similar equipment.

Brand managers in consumer markets place more emphasis on individual rather than corporate brands; this is in contrast to brand managers in industrial markets, who tend to focus on building the brand at the corporate level. One study (conducted in India) that produced findings which are of particular interest in the context of this study was conducted by Sharad Sarin( 2010, p.42). He surveyed 60 respondents from four B2B organizations to understand the various factors involved in industrial purchase decisions. The study revealed that B2B buyers use a combination of 12 factors in their buying decisions. Eight of these would come under tangible or rational factors; the remaining four belong to intangible and emotional factors.

Tangibles/ Rational Factors Importance ( %) 10 9.38 8.65 8.6 8.26 8.3 7.87 7.52 70%

Emotional / intangible Factors Importance ( %) 7.36 9.72 7.57 6.69

1 2 3 4 5 6 7 8

Attributes Quality Performance Delivery fulfillment After sales service Price Availability Ease of Maintenance Ease of Operation Total

9 10 11 12

Attributes Reputation of supplier Reliability Brand Relationship with supplier

Total

30%

The above mentioned Indian study like their counter parts is echoing the same conclusion of the role of brands in B2B markets. The Indian Construction industry In India Construction has accounted for around 40 per cent of the development investment during the past 50 years. Around 16 per cent of the nation's working population depends on construction for its livelihood. The Indian construction industry employs over 3 crore people and creates assets worth over 20,000 crore. It contributes more than 5 per cent to the nation's GDP and 78 per cent to the gross capital formation. Total capital expenditure of state and central govt. will be touching 8,02,087 crores in 2011-12 from 1,43,587 crores (1999-2000)1. In about just a decade India will move on from ninth-largest to third-largest construction market in the world, a new 10-year forecast titled Global Construction 2020 published by Global Construction Perspectives and Oxford Economics has said. The report has predicted that, by 2020, India's construction market will be worth almost $650 million
1

The Hindu , (Feb 04, 2011). Rapid Growth of construction industry highlighted.

making up 5 per cent of the world's total construction output. Only construction giants China and USA will be doing better than India. With the growing investments in the infrastructure industry, construction equipment manufacturers (international & national) have unveiled ambitious plans for India. International majors are setting up plants, gearing up to meet the expected surge in demand. John Patterson, managing director and CEO, JC Bamford Excavators Ltd (JCB) of the UK, noted that India had emerged as one of the key international markets for construction equipment firms. It will rank among the top 10 markets for construction equipment, and is likely to overtake countries like Spain and Italy With more and more players entering into Indian construction equipment market, branding of construction equipment has gained importance.

Survey of Literature

1. The six biggest pitfalls in B-to-B branding, by Dan Morrison, Journal of The Business 2 Business Marketer, Vol.6, July - August 2001. This article discusses on the six major pitfalls that are encountered in B-to-B branding Pitfall No.1: Branding is only a Consumer Products Thing. Not true. IBM successfully tapped into the power of branding by focusing on the value it provided customers and simplifying the buying experience for customers. By streamlining its powerful corporate computer offerings and rebranding them under the new eServers brand, customers were more easily able to understand IBMs server offerings. Additionally, the new brand was clearly linked to its eSolutions brand of IT consulting, creating stronger cross-setting opportunities. Pitfall No.2: Branding is Simply a Name and Logo. Ingersoll-Rand recently renamed and rebranded itself as IR as part of a large brand strategy designed to leverage the IR master brand across all of its divisions Climate Control, Industrial Productivity, Infrastructure and Security and Safety. The idea: to signal that IR is no longer just a heavy-duty tool manufacturer, but a diversified company comprised of industrial brands. Each group under the corporate umbrella retains a powerful brand(s) to focus on specific industry needs: the IR brand leverages the parents long heritage of financial stability and renowned product quality. Pitfall No.3: Only Products are branded. Tyco International has become one of the most powerful b-to-b brands but the Tyco name is rarely used as a customer-facing brand. Its strategists realized that

branding medical products, fire alarms and security systems, pipes and valves and chips and fiber optics under one name would not only send conflicting messages, but present no value proposition. Tyco knows that its corporate brand is not the same as the company and product brands that it owns and manages. It is in the management of those brands upon which Tyco has built its corporate brand. By separating its corporate and product brands, Tyco has been able to market itself as a growing company of powerful brands in profitable businesses, versus struggling fruitlessly to find a common association across its businesses. Pitfall No.4: Brands Take Care of Themselves. If brand is an asset, then it must be treated like one - receiving investment, management and maintenance. A brand is affected by internal and external forces requiring reactions and changes. But this only occurs if the organization clearly understands the brand and how to manage it. Pit fall No.5: Branding Decisions are based on Purely Internal Perspectives. ITT, Manufacturer of engineered products from space borne navigation systems to shock absorbers, has spent millions on a branding campaign. Its name is plastered across business journals to Sunday morning television news. Should it have been sending its branding message to the general public? In fact, ITT had an identity problem that might not have been effectively uncovered if it had only taken an internet perspective. Many particularly those in the investment community still associated the ITT brand not only with its engineered products, but with its financial services and resort hotels all of which were interests divested in the mid-1990s. They were unclear on what ITT is, and what it wanted to be. The corporation realized that it was internally clear on its brand identity, but it needed to clarify it by communicating a clear message to the Street.

Pit fall No.6: Branding is only an externally Focused Marketing Endeavor. An effective brand strategy requires internal communications and training on what the brand represents, where the company is going with its band and what needs to be done to get there. As part of its eServer rebranding. For example, IBM realigned its sales and support that focused on selling and supporting a full line of products, not just one server brand. 2. A Roadmap for Branding in Industrial Markets, by Kevin Lane Keller & Frederick E. Webster, Jr., February 2004. This paper on industrial branding is considered as a guide for B-to-B organizations opting for branding. The recent upsurge in interest in brand equity and brand strategy had had an impact on industrial marketing as business-tobusiness marketers refocus on their corporate names and brands. While most discussions of branding have tended to ignore industrial markets, the fundamentals of sound brand strategy, beginning with market segmentation, targeting and positioning apply. But, the uniqueness of industrial markets, and especially of the organizational buying process, must be taken into account in developing sound industrial branding strategy. The result can be the creation of better differentiated product offerings, stronger relationships between industrial marketers and their customers, more customer loyalty, better response to company innovations and marketing expenditures and the creation of more value for customers and the firm. This paper also provides alternative communication options for industrial markets. 3. The power of emotion: Brand communication in business-to-business markets, by Joanne Lynch & Leslie De Chernatony, Journal of Brand Management, Vol.11, May 2004. In increasingly competitive markets, branding is of growing interest to businessto-business (B2B) firms. Despite an increased interest in branding, and the predominance of branding in consumer markets, B2B branding has received scant 8

attention from academics. In this paper it is argued that organizational buyers can be influenced by both rational and emotional brand values and that B2B brands can surmount functional capabilities to create an emotional connection with buyers. The development and communication of emotional brand values may enhance the potential for value creation and be a means of developing a sustainable differential advantage. For B2B brands to connect with organizational customers, emotional brand values need to be communicated effectively both within the organization as well as externally through the industrial sales force. A model is proposed that shows how B2B brands should reflect a greater balance between functional and emotional values. There is a clear need for further research into the way in which brands are used, communicated and perceived in B2B markets. 4. Corporate branding for small to medium-sized businesses A missed opportunity or an indulgence? By Irene Inskip, Journal of Brand Management, Vol.11, May 2004. Corporate branding, both as a philosophy of organizational change and as a process, is well understood in many business-to-consumer (B2C) organizations in the UK. This paper claims that this is not the case in the business-to-business (B2B) sector, particularly in small to medium-sized enterprises (SMEs). The understanding that corporate branding can offer real opportunities for differentiation is patchy in this sector. This paper examines why this is and asks questions about the role of the branding industry in this issue. Qualitative research data is synthesized, alongside recent interviews with the CEOs of small to medium-sized B2B enterprises and representatives from the branding industry. The paper ends with recommendations for a specific approach for SMEs facing this challenge.

5. Antecedents of industrial brand equity: An empirical study, by Allard C.R. van Riel, Charles Pahud de Mortanges & Sandra Streukens, 2005. This article Proposes and empirically validates, a theoretically structured approach to measure brand equity, its antecedents and its consequences for industrial products. The model distinguishes between product and corporate brand equity, uses buyer perceived performance on the dimensions of the marketing mix as antecedents of brand equity, and relates them to repurchase and loyalty intentions. Questionnaire Development Based on previous research and the interviews, a questionnaire was developed. Items were measured as self-reported assessments of statements, evaluated on a 7point Likert scale. The questionnaire was made available online. Sampling With the support of company sales representatives, an invitation to participate in the survey was sent to buyers in Europe, the US, and Asia. The response rate was 8.8%, with 36 respondents from Europe, 18 from the US, and 13 from Asia, and 8 from elsewhere (n=75). 37 were active in the electrical/electronics industry, 26 in the automotive industry, and 12 were active in various other industries. 60% of the respondents were engineers. Analysis of the data obtained through the questionnaire was done using correlations between the factors. The results show that product brand equity is mostly influenced by physical product attributes and distribution. Employees and information played a lesser role. Corporate brand equity is mostly determined by service attributes, and employees. Here distribution and value did not play a direct role. In terms of direct effects, the corporate brand seems to be slightly more important in industrial markets than the individual product brand; however, the product brand contributes not only directly to behavioral intentions, but also indirectly via corporate brand equity.

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Brand equity appears to play a significant role in industrial branding. It was conceptualized as the result of past investments in the 5 Ps of the marketing mix. That is, investments in product, place, people, promotion and price. In the business-to-business context, promotion was interpreted as providing information. Buyers perceptions about the 5Ps have an influence on the way they perceive and evaluate the brand. This, in turn, has an effect on their purchase decisions. By investing in the 5 Ps, companies create brand awareness and a positive brand image. In this way, brand equity and loyalty are created. Two interrelated components of brand equity were distinguished: product brand equity and corporate brand equity. 6. Cultural values and branding in an emerging market: the Indian context, by S. Ramesh Kumar, Nitya Guruvayurappan & Madhurjya Banerjee, Journal of The Marketing Review, Vol.7, 2007. This study probes into specific Indian values drawn from literature, uses them to analyze how appropriate they are to consumer belonging to two socioeconomic classes in three categories of products close to the cultural moorings of Indians tea, hair oil and fairness creams. The idea behind the analysis of values stems out of the fact that values are enduring since they are not tied to anything specific, and instead manifest themselves in many nuances of behavior, including choice and purchase preference. The results of the respondents are compared with the authors perception of how the advertisements in the respective categories reflect the values found significant among the respondents. The practical implications of such a study range from adopting Indian cultural cues to advertisements, to combining a unique mix of Indian cultural values to a brand in a specific category. The research conducted showed that across categories there was a significant difference or mismatch between the communication by the brand and the inherent values of Indian Culture. Many multinational brands, while entering the Indian market fail to realize the importance of Indian values and use them in their communication. They often undermine the importance of several subcultures in 11

the Indian context. The brand communication successful in one region of the country is often replicated verbatim in another region without paying any heed to the cultural differences that exist across the geographies. 7. Multiple roles of brands in business-to-business services, by Jane Roberts & Bill merrilees, Journal of business & Industrial Marketing, Vol. 22, June 2007. This paper focuses on a B2B service industry namely leasing mall space to retail tenants. A Quantitative study is undertaken of 201 mall tenants using structural equation model analysis. The Primary research objectives in the study are To identify the determinants of brand attitudes in B2Bservices To ascertain whether branding mediates the service quality to trust relationship. To determine whether branding influences the contract renewal decision.

The researchers have developed a questionnaire and the entire brand scales were tested as reliable with the cronbachs ranging from 0.78 to 0.93, comfortably above the 0.70 threshold required. The average variance extracted was also satisfactory, ranging from 0.58 to 0.87, all above the desired threshold of 0.50. The results of the research are summarized as below: 1. There were two determinants of brand attitudes. Service Quality Empowerment Responsiveness Empowerment Brand

The three determinants of trust.

3. The two determinants of contract renewal. Brand attitude Trust

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8. The importance of brand in the industrial purchase decision: a case study of the UK tractor market, by Keith Walley, Paul Custance, Sam Taylor, Adam Lindgreen & Martin Hingley, Journal of Business & Industrial Marketing, Vol.22, June 2007. This article aims to report the findings of a case study that investigated the role of branding in the industrial purchase of agricultural tractors in the UK. The study was designed to test the below three Hypotheses: H1: Brand name is not an important factor in the choice of tractors by UK farmers and contractors. H2: UK tractor buyers are not brand loyal. H3: The major tractor brands available in the UK are perceived in a relatively similar way. A full factorial design was employed based upon tractor attributes and the level of these attributes. A literature survey and a semi structured interviews revealed that there are five attributes which were given major preference during purchase decision. 1. Brand name 2. Price 3. Dealer proximity 4. Quality of dealers services 5. Buyers experience of the dealer. The findings of the study can be summarized as 1. Brand loyalty is an important factor influencing tractor buying. 2. There is a difference in the perceived importance of the various brand names. 3. Brand loyalty in industrial markets is some what inconclusive for some products brand loyalty is weaker due to economic pressures, but for others the opposite may be true.

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9. Being known or being one of many: the need for brand management for business-to-business (B2B) companies, by Philip Kotler & Waldemar Pfoertsch, Journal of Business & Industrial Marketing, Vol.22, June 2007. This Research paper stresses the importance of branding for B2B companies. It provides examples of companies in B2B industry that have reaped the benefits of branding in the form of competitive advantage. Ex: - Intel (Intel Inside Campaign) & Boeing (Dream Liner Campaign) The Major objective of the paper is to understand whether branding efforts in B2B industries would lead to success by means of improved stock performance. The analysis of stock performance (1995-2005) of various companies revealed the below. 1. Companies who have focused on brands in B2B sectors had over performed than others in terms of market capitalization. 2. The top B2B brand performers were caterpillar, GE & Hewlett Packard. 3. The under performers were Intel, IBM, J P Morgan & Microsoft. 4. Weak brands suffer in difficult times and do not recover as quickly as strong brands. 10. An application of Kellers brand equity model in a B2B context, by Kerri-Ann L. Kuhn, Frank Alpert & Nigel K. Ll. Pope, Qualitative Market Research: An International Journal, Vol.11, January 2008. This paper aims to discuss the suitability and limitations of Kellers customer based brand equity model and tests its applicability in a B2B market. The study involved the use of semi-structured interviews with senior buyers of technology for electronic tracking of waste management.

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Resonan ce Judgment s Performan ce Feelin gs

4. Relationships What about you and me?

3. Response What about you?

Imagery

2. Meaning What are you?

Salience

1. Identity Who are you?

As per the study B2B products also possess images, associations and perceptions of value, but initial awareness and associations are often achieved by direct contact with company sales people. The Findings of the study can be summarized in the below pyramid model.
4. Relationships What about you and me? Partnership Solutions Sales Force Judgments Relationship s Performance Reputation

3. Response What about you?

2. Meaning What are you?

Salience of the Manufacturers Brand

1. Identity Who are you?

11. Adoption of corporate branding by managers: Case of a Nordic business-tobusiness company, by Jaakko Aspara & Henrikki Tikkanen, Journal of Brand Management, Vol.16, August - October 2008. The Purpose of this paper is to study the previously neglected issue of which management practices of corporate branding the managers of B2B companies are actually motivated to adopt and what goals related to customers, on the one hand, and to other stakeholders, on the other, those practices are considered to serve.

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The study approach is data-drive, with a large Finland based, globally operating pulp and paper corporation as the case company. As the main source of data, the authors use interviews of the case companys managers. The findings suggest that the managers became motivated to adopt various management practices of corporate branding, related to (1) managing the brand hierarchy of the brand portfolio, (2) having corporate name dominance in association to product brands, mills, sales offices, etc and (3) defining and communicating aspirational corporate brand image values. The management goals behind adopting these corporate branding practices were related not only to customers but also to investors and investment analysts, potential employees, and own employees and managers. The study improves B2B managers understanding about what kind of management practices corporate branding may involve and what kind of goal those practices can be considered to serve. 12. The rise and rise of the B2B brand, by Rick Wise & Jana Zednickova, Journal of Business Strategy, Vol.30, January 2009. This article by Mr. Rick Wise and Jana Zednickova argues that competition in the sectors as varied as construction equipment and chemicals is more intense than ever. In short, B2B organizations need robust, Coherent brands if they are to grow as fast as they tell shareholders they will. This article also discusses on the myths that persist in B2B circle. 1. It is just a new logo, right? 2. It is not an issue for rational business audiences. 3. We do not have the ad budgets that the consumer companies have. 4. With better salespeople, we can crack these problems. 5. We will make it a marketing mandate. The authors feel that it is time for B2B companies to step up their brand management activities. Decades of branding experience in consumer goods sectors point to what works and what does not. The examples set by leaders such as Johnson controls and Dow show what can be done in B2B Industries.

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Brand has entered the popular vocabulary. So, when will it become part of the vernacular at B2B companies? 13. Bridging Industrial Segmentation Theory and Practice, by Ann Hojbjerg Clarke, Journal of Business-to-Business Marketing, 2009. Segmentation is seen today as a core concept within mainstream marketing. While industrial segmentation has received considerable attention within academic literature, there have been many reports on companies having problems using, applying, and implementing the principles of segmentation. This Article presents the process of segmentation using a build-up approach based on qualitative market data. The process is practical and easily approachable for companies. The purpose behind segmentation is strategic-identify segments and facilitate the planning of future product offers. It is argued that segmentation should be dedicated to the purpose and context of the company. 14. The effects of corporate social responsibility on brand performance: The mediating effect of industrial brand equity and corporate reputation, by ChiShiun Lai, Chic- Jen Chiu, Chin- Fang Yang & Da- Chang Pai, Journal of Business Ethics, 2010. In this article, the researchers explore the following question. Can corporate social responsibility (CSR) and the corporate reputation of a firm lead to its brand equity in business-to-business (B2B) markets? This study discusses CSR from customers viewpoints by taking the sample of industrial purchasers from Taiwan small-medium enterprises. The aims of this study are to investigate: first, the effects of CSR and corporate reputation on industrial brand equity; second, the effects of CSR, corporate reputation, and brand equity on brand performance; and third, the mediating effects of corporate reputation and industrial brand equity on the relationship between CSR and brand performance. Empirical results support the studys hypotheses and indicate that CSR and corporate reputation and industrial brand equity partially mediate the relationship between CSR and brand performance.

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15. TATA STEELIUM A Success story in B2B Branding, by Kaushik Bhattacharya & Biplab Datta, VIKALPA, Vol.35, April - June 2010. This case study demonstrates the importance of branding products like steel. TATAs have demonstrated that branding is not limited to consumer products and can be successfully replicated to B2B products. TATAs have identified that the market in India has matured and this was the right time for branding industrial products like steel. By engaging in branding of CRS, TATA steel could create value primarily in two areas. It could positively position CRS in the retail market against others in the industry and could achieve more market leverage related to pricing and negotiations.
`42,700 `.700 `.400 550 `. 42,150

Price of TATA Steelium (includes freight)

Loss for no support service

Impact of Value of CRS relationship with from new entrants distributors

Essars current price (includes freight)

16. Searching for Premium Brand Characteristics in Capital item Installations, by Olli Pekkarinen & Risto T. Salminen. This research paper studies the relation between price premiums and premium industrial brands in capital item installations, because the formal and rational buying process in industrial purchasing does not traditionally support the idea of higher price margins. In this study of capital item installations this dilemma is

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opened by reviewing industrial and consumer branding and academic pricing literature. At first glance, suppliers seem to possess nearly identical product characteristics and performance, but some of them eventually jump out from the mass. Some are even able to charge higher prices for their products unique brands can command a price premium. The willingness to pay a price premium is one of the strongest indicators of brand loyalty. Research Setting and Methodology This study focuses first on exploring the causes for a customer to approve premium prices in the purchasing of capital item installations. This is done by reviewing academic literature on industrial branding and pricing. The aim is then to build a conceptual model about the prerequisites of premium in capital item installations. Consequently, the research questions are: RQ1. What issues are there in academic literature about branding in the marketing of capital item installations? RQ2. What are the prerequisites for a premium in capital item installations? A thorough literature survey points out that the main driver for an industrial customer purchasing premium capital item installation seems to be risk avoidance. Industrial products consist of tangible and intangible elements. The role of intangible elements is widening and these elements can be found even in a rational and systematic purchase decision process. In complex business-tobusiness markets, such as in the context of this study, the purchasing decision is often made on the basis of complex dynamics within the decision making unit. As a result of the brand comparison (RQ1), this paper concludes that industrial branding is relatively little studied with in the academic literature, but fairly complicated, and it emphasizes long-term benefits compared to more emotional and transaction-based consumer branding. Also the concept of premium is intertwined with many factors and actors that are not present in consumer branding. On the basis of the literature review (RQ2) , five prerequisites for a

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supplier selling premium capital item installations have been identified and can be depicted as below.
Customized and reliable product with intangible elements

Reliable and accurate distribution

Good supplier reputation and technology

Prerequisites for premium in capital item installation Reasonable price margin compared to competitors Well-organized strong brand

17. Strategic Brand Management for B2B Markets A Road Map for Organizational transformation. - Sharad Sarin 2011. This can be mentioned as first of its kind book on B2B Branding in the Indian context. This book focuses first on understanding the importance attributed to various factors in purchase decisions of B2B products. This book deals with understanding the impact of corporate brand on the individual product brands. Research Studies related to B2B branding in the Indian context have been dealt at length in this book. There is an extensive discussion on the three most respected corporate brands in indis-Tata, Larsen & Toubro and Infosys. The author demonstrates how these companies have created value through brands and set a bench mark in their own industry.

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Need for the study:

With gradual increase in demand for construction equipment in India (Pls refer table No 1), major construction equipment manufacturers have entered / focused on the Indian market. This resulted in intense competition and manufacturers started focusing on brand building to have a competitive edge over others. This situation demanded manufacturers to understand the importance that customers attribute to brand in their purchase decision. Branding has been subject to considerable research and debate in recent times (Aaker and Joachimsthaler, 2000; Mudambi, 2002) Despite this interest, however, there remain some areas where research is limited, dated and more irrelevant to Indian context. After the literature review, it was understood that there are very few studies on B2B branding and hardly any studies on B2B branding in the Indian context. The literature review has also bought into light the fact that there were some areas like construction equipment branding, which have not received the attention of researchers. This Study on The importance of brand in the purchase decision of B2B products (with specific reference to construction equipments)would try to fill the void.

In order to understand the significance of branding in purchase decisions of B2B products, study would be conducted on selected construction equipment brands of Backhoe Loaders, Excavators and Aggregate Crushing Equipment in Andhra Pradesh. Construction contractors/ companies have a major presence in Andhra Pradesh and amount to nearly 35-40% ( By volume) (Pls refer Annexure-1) of the purchases of construction equipment made in India and this is the reason for selecting Andhra Pradesh for the study.

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The reason for selecting Backhoe Loaders, Excavators, and Aggregate crushing Equipment from the lengthy list of construction equipment is as below JCB has a market share of more than 75%2 in Backhoe Loader market, which makes it an interesting subject of study. This study would try to understand the role of branding in achieving this market leadership. The Sale of Excavators in terms of volume (Year 2005-2010) is next to Backhoe Loaders (Refer Table 1.), which gives more scope for study. There are more no. of manufacturers (12 suppliers) of excavator than any other construction equipment, which gives scope for comparative study. Aggregate Crushing Equipment is one of the high value products (value of the product would be more than 2 Crores) in the construction equipment industry, which involves very complex buying decision process (Buying centre) and hence the same was selected for study. As a buying centre is involved in the decision making process of Aggregate crushing equipment, branding can play a vital role in making the complex decision process much simpler. Selection of aggregate crushing equipment for the study would provide insights into effect of branding on buying centre decisions.

The Hindu -Business Line, (Sep 30, 2010). JCB upbeat on India market

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Sale of Construction equipment from 2005-2010

2005 Articulated Dump Trucks Asphalt Finishers Backhoe Loaders Compaction Equipment Crawler Dozers Crawler Excavators Crawler Loaders Mini Excavators Mobile Compressors Mobile Cranes Motor Graders Rigid Dump Trucks Rough Terrain Lift Trucks Skid-Steer Loaders Wheeled Loaders Total Construction Equipment Annual % change 3 473 9133 1445 325 4522 1 22 1157 4140 185 784 1 118 1312 23621

2006 19 687 13797 2335 550 5904 3 24 1906 5859 360 749 3 175 1879 34250 45%

2007 13 954 21769 3219 599 9606 6 22 2620 8115 544 594 11 265 2364 50701 48%

2008 33 879 16673 2905 608 9897 5 64 2854 7870 553 771 6 480 2540 46138 -9%

2009 11 920 16001 2787 562 7944 4 71 2999 6499 342 808 15 290 1902 41155 -11%

2010 16 1152 23120 3215 713 10258 6 82 3486 8253 612 913 18 512 2833 55189 34%

% Change 2009-2010 45% 25% 44% 15% 27% 29% 50% 15% 16% 27% 79% 13% 20% 77% 49% 34%

Table 1. Source: Off Highway Equipment Analysis report 2010

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Objectives of the study:

The Study will have the following objectives: 1. The importance of brand in purchase decisions of backhoe loaders, excavators and aggregate crushing equipment. 2. To understand whether customers of backhoe loaders, excavators, aggregate crushing equipment are brand loyal. 3. The importance assigned to various attributes in a purchase decision of backhoe loaders, excavator, and aggregate crushing equipment. 4. To find the brand utility of various backhoe loaders, excavators, aggregate crushing equipment brands in Andhra Pradesh market and analyze the reasons for the same. 5. To suggest various organizations on the customers perception of their brand.

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Methodology
Population: Customers of Construction Equipment in Andhra Pradesh Data Collection: Primary Data. The sample frame for the study is the database of customers who have purchased construction equipment in Andhra Pradesh in last three years (Pls refer Annexure-2). Backhoe Loaders The Primary Data would be collected through structured questionnaire. There are about 450 Customers (Organized Sector- with Turnover More than 10 Crores) of Backhoe loaders in Andhra Pradesh. A Sample Size of 114 has been arrived at by using the below formula and data will be collected through simple random sampling method using random tables.

P A Z R N n

0.5 0.1 1.96 0.7 450 114

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In the above calculation, I have used R=0.7 (Response rate of 0.7 as customers of backhoe loaders are not educated and may be reluctant to participate in the survey) Excavators The Primary Data would be collected through structured questionnaire. There are about 410 Customers (Organized Sector- with Turnover More than 10 Crores) of Excavators in Andhra Pradesh. A Sample Size of 112 has been arrived at by using the above formula and data will be collected through simple random sampling method using random tables.
P A Z R N n 0.5 0.1 1.96 0.7 400 112

In the above calculation, I have used R=0.7 (Response rate of 0.7 as customers of excavators are not educated and may be reluctant to participate in the survey) Aggregate Crushing Equipment
P A Z R N n 0.5 0.1 1.96 0.8 125 68

There are about 125 Customers (Organized Sector- with Turnover More than 10 Crores) of Crushers in Andhra Pradesh. A Sample Size of 68 has been arrived at by using the above formula and data will be collected through simple random sampling method using random tables. In the above calculation, I have used R=0.8 (Response rate of 0.8 as customers of Aggregate crushing equipment are more organized and professional and hence more response rate is expected)

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Sr.No 1 2 3

Equipment Back Hoe Loaders Excavators Aggregate Crushing Equipment

Population 450 410 125 Total sample Size

Sample Size 114 112 68 294

Secondary Data: Secondary data will be collected from journals, publications, internet and government agencies. Data Analysis and Presentation: Raw data collected from structured questionnaire would be converted to meaningful information using statistical interventions like Percentages, Factor Analysis and Conjoint Analysis. When making actual purchase decisions, customers would consider a number of factors together. In order to capture these multiple factors, I would prefer to employ the multivariate technique known as Conjoint Analysis. A Factorial design would be employed to arrive at the attributes to be considered for performing the Conjoint Analysis.

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Hypotheses to be tested:
H1: Brand name is not an important factor in the choice of construction equipment by customers of Andhra Pradesh. Though the literature provides information regarding importance of branding in B2B products in the Indian context (Sharad Sarin 2010, p.42), there has been no study on importance of brand in purchase decision of construction equipment and hence Hypothesis H1. H2: Construction equipment buyers are not brand loyal. Literature related to influence of brand loyalty on purchase decisions of B2B products is not available in the Indian context. Hypothesis H2 would be used for understanding and analyzing the effect of brand loyalty on repeat purchases. H3: The major construction equipment brands in Andhra Pradesh are perceived in a relatively similar way. Some industrial buyers feel that they gain prestige or status by buying from a market leader and that large size and market share can inspire confidence in buyers (Mudambi et al., 1997).This Hypothesis ( H3) would try to analyze whether the ranking of brand names and market share of various organizations are inter-related.

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Managerial Implications The results of this study would enable managers to decide on the importance customers attribute to brand; this in turn would help organizations to decide on the resource allocation for branding activities. The results would also enable organizations understand the importance of various brands as perceived by customers. .Organizations can also re-look into pricing/ premium charged for various construction equipment based on importance assigned by customers to various attributes in the buying decisions. This study can provide insights into branding efforts made by construction equipment manufacturers and the results of the same in terms of improvement in sales, price realization and better profit margins

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References
Aaker, D. and Joachmsthaler, E. (2000), Brand Leadership, The Free Press, New York, NY. Beverland, M.B. (2005), Creating value for channel partners: the Cervena case, Journal of Business & Industrial Marketing, Vol. 20 No.3, pp.127-35. De Chernatony, L. and McDonald, M. (1998), Creating powerful Brands in Consumer, Service and Industrial Markets, Butterworth- Heinemann, Oxford. Keller, K.L. (1993), Conceptualizing, measuring, and managing customer based brand equity, Journal of Marketing, Vol. 57 No. 1, pp. 1-22. Kotler, P. (2000), Marketing Management: The Millennium Edition, Prentice-Hall, Upper Saddle River, NJ. Kotler, P. and Waldermar Pfoertsch. (2006), B2B Brand Management. Berlin, Heidelberg/ New York: Springer. Low, J. and Blois, K. (2002), The evolution of generic brands in industrial markets: the challenges to owners of brand equity, Industrial Market Management, Vol.31 No.5, pp. 385-92. Mudambi, S., Doyle, P. and Wong, V. (1997), An exploration of branding in industrial markets, Industrial Marketing Management, Vol. 26 No. 5, pp. 443-46. Mudambi, S. (2002), Branding importance in business-to-business markets: three buyer clusters; Industrial Marketing Management, Vol. 31 No. 6, pp. 525-33. Porter, M.E. (1985), Competitive Advantage: Creating and Sustaining Superior Performance, The Free Press, New York, NY. Sharad Sarin ( 2010), Strategic Brand Management for B2B Markets- A Road Map for organizational transformation, Sage Publications pp. 42.

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Annotated Bibliography
1. The six biggest pitfalls in B-to-B branding by Dan Morrison, Journal of The Business 2 Business Marketer, Vol.6, July - August 2001. 2. Organizational Research: Determining Appropriate sample size in survey research by James E. Bartlett, II, Joe W. Kotrlik & Chadwick C. Higgins, Information Technology, Learning, and Performance Journal, Vol.19, spring 2001. 3. A Roadmap for Branding in Industrial Markets by Kevin Lane Keller & Frederick E. Webster, Jr., February 2004. 4. The Power of emotion: Brand communication in business-to-business markets by Joanne Lynch & Leslie De Chernatony, Journal of Brand Management, Vol.11, May 2004. 5. Corporate branding for small to medium-sized businesses A missed opportunity or an indulgence? by Irene Inskip, Journal of Brand Management, Vol.11, May 2004. 6. Antecedents of industrial brand equity: An empirical study by Allard C.R. van Riel, Charles Pahud de Mortanges & Sandra Streukens, 2005. 7. Cultural values and branding in an emerging market: the Indian context by S. Ramesh Kumar, Nitya Guruvayurappan & Madhurjya Banerjee, Journal of The Marketing Review, Vol.7, 2007. 8. Multiple roles of brands in business-to-business services by Jane Roberts & Bill merrilees, Journal of business & Industrial Marketing, Vol. 22, June 2007. 9. The importance of brand in the industrial purchase decision: a case study of the UK tractor market by Keith Walley, Paul Custance, Sam Taylor, Adam Lindgreen & Martin Hingley, Journal of Business & Industrial Marketing, Vol.22, June 2007.

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10. Being known or being one of many: the need for brand management for businessto-business (B2B) companies by Philip Kotler & Waldemar Pfoertsch, Journal of Business & Industrial Marketing, Vol.22, June 2007. 11. An application of Kellers brand equity model in a B2B context by Kerri-Ann L. Kuhn, Frank Alpert & Nigel K. Ll. Pope, Qualitative Market Research: An International Journal, Vol.11, January 2008. 12. Conference Commentary Breaking free from the industrial age paradigm of branding by George Christodoulides, Journal of brand Management, Vol.15, March 2008. 13. Adoption of corporate branding by managers: Case of a Nordic business-tobusiness company by Jaakko Aspara & Henrikki Tikkanen, Journal of Brand Management, Vol.16, August - October 2008. 14. The rise and rise of the B2B brand by Rick Wise & Jana Zednickova, Journal of Business Strategy, Vol.30, January 2009. 15. Bridging Industrial Segmentation Theory and Practice, by Ann Hojbjerg Clarke, Journal of Business-to-Business Marketing, 2009. 16. The effects of corporate social responsibility on brand performance: The mediating effect of industrial brand equity and corporate reputation by Chi-Shiun Lai, Chic- Jen Chiu, Chin- Fang Yang & Da- Chang Pai, Journal of Business Ethics, 2010. 17. Living the brand: brand orientation in the business-to-business sector by Carsten Baumgarth, European Journal of Marketing, Vol.44, 2010. 18. TATA STEELIUM A Success story in B2B Branding by Kaushik Bhattacharya & Biplab Datta, VIKALPA, Vol.35, April - June 2010. 19. Searching for Premium Brand Characteristics in Capital item Installations by Olli Pekkarinen & Risto T. Salminen. 20. B2B Branding: Consumer Branders need not apply by Kathryn Roy & Gib Trub.

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21. http://www.interbrand.com/en/best-global-brands/Best-Global-Brands-2010.aspx Dated 23/10/2010. 22. http://www.thehindubusinessline.com/2010/09/30/stories/2010093052120700.htm Dated 30/09/2010.

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