Featured Research

from universities, journals, and other organizations

Battle Of The Brands: Branded Components Changing Industry Structures

Date:
August 19, 2009
Source:
University of Minnesota
Summary:
Back in the day, planes, trains and automobiles all sported one brand name. If you bought a Boeing, you got, nose to tail, a Boeing. These days, however, complex industrial equipment is starting to look like NASCAR vehicles festooned with logos. Why does it matter? "When component brands become powerful it changes the industry," say researchers.

Back in the day, planes, trains and automobiles all sported one brand name. If you bought a Boeing, you got, nose to tail, a Boeing. These days, however, complex industrial equipment is starting to look like NASCAR vehicles festooned with logos. Why does it matter? "When component brands become powerful it changes the industry," says George John, Marketing Department Chair at the University of Minnesota's Carlson School of Management.

"What becomes more important, the product brand or the component? The Dodge truck or its Cummins engine?"

John and co-author Mrinal Ghosh (University of Arizona) investigate component branding in a forthcoming study in the Journal of Marketing Research. Various technologies that provide benefits like fuel efficiency, higher download speeds and better safety ratings all arise from component branding. But the innovation that makes these products superior often doesn't come from the primary brand, it comes from the component brand. To assure the makers of component technologies that the partnership will endure for long enough to make their investment worthwhile, visible acknowledgments of the added benefit – and which company brought the consumer that added benefit – have become common.

On 30% of the industrial products in their sample, everyday users will see at least one brand displayed in addition to the primary brand. No longer are they using a Dell computer, they're using a Dell with Intel Inside. "The component brand name, right there on a product, is, in a way, insurance that the company won't be dropped for a newer, cheaper, competitor next year," says John. "The co-branding is enough of a deterrent that the product brand won't switch to a different supplier. This gives the component maker the ability to put effort and resources into developing the product," says John.

Beyond simple consumer curiosity, this shift to visibly branded components should be noted by policy makers and regulators. "When an industry changes from a vertical structure with dominant primary brands to a horizontal structure with dominant component brands, suppliers become more powerful. And if the industry is in trouble, who gets bailed out? Detroit Diesel or GM? Cummins or Dodge? The right answers must depend on a deep understanding of who offers the real value," notes John.


Story Source:

The above story is based on materials provided by University of Minnesota. Note: Materials may be edited for content and length.


Cite This Page:

University of Minnesota. "Battle Of The Brands: Branded Components Changing Industry Structures." ScienceDaily. ScienceDaily, 19 August 2009. <www.sciencedaily.com/releases/2009/08/090819113449.htm>.
University of Minnesota. (2009, August 19). Battle Of The Brands: Branded Components Changing Industry Structures. ScienceDaily. Retrieved August 2, 2014 from www.sciencedaily.com/releases/2009/08/090819113449.htm
University of Minnesota. "Battle Of The Brands: Branded Components Changing Industry Structures." ScienceDaily. www.sciencedaily.com/releases/2009/08/090819113449.htm (accessed August 2, 2014).

Share This




More Science & Society News

Saturday, August 2, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

Escaping Email: Inspired Vision or Pipe Dream?

Escaping Email: Inspired Vision or Pipe Dream?

AP (Aug. 1, 2014) Dustin Moskovitz is plotting an escape from email, using his communications expertise in an attempt to change the way people connect at work, where the incessant drumbeat of email has become an excruciating annoyance. (Aug. 1) Video provided by AP
Powered by NewsLook.com
Emory Prepares to Treat American Ebola Cases

Emory Prepares to Treat American Ebola Cases

AP (Aug. 1, 2014) Plans are underway to bring back the two American aid workers sick with Ebola from Africa. The U.S. State Department and the Centers for Disease Control and Prevention are helping to arrange the evacuation. (Aug. 1) Video provided by AP
Powered by NewsLook.com
Greenpeace Ship Arctic Sunrise Free to Leave Russia

Greenpeace Ship Arctic Sunrise Free to Leave Russia

AFP (Aug. 1, 2014) Greenpeace's ship Arctic Sunrise, held in custody by the Russian authorities since September last year, has departed the Russian city of Murmansk en route for its home port of Amsterdam. Duration: 01:04 Video provided by AFP
Powered by NewsLook.com
US Employers Add 209K Jobs, Rate 6.2 Pct

US Employers Add 209K Jobs, Rate 6.2 Pct

AP (Aug. 1, 2014) U.S. employers extended their hiring surge into July by adding a solid 209,000 jobs. It was the sixth straight month of job growth above 200,000, evidence that businesses are gradually shedding the caution that had marked the 5-year-old recovery. (Aug. 1) Video provided by AP
Powered by NewsLook.com

Search ScienceDaily

Number of stories in archives: 140,361

Find with keyword(s):
Enter a keyword or phrase to search ScienceDaily for related topics and research stories.

Save/Print:
Share:

Breaking News:
from the past week

In Other News

... from NewsDaily.com

Science News

Health News

Environment News

Technology News



Save/Print:
Share:

Free Subscriptions


Get the latest science news with ScienceDaily's free email newsletters, updated daily and weekly. Or view hourly updated newsfeeds in your RSS reader:

Get Social & Mobile


Keep up to date with the latest news from ScienceDaily via social networks and mobile apps:

Have Feedback?


Tell us what you think of ScienceDaily -- we welcome both positive and negative comments. Have any problems using the site? Questions?
Mobile: iPhone Android Web
Follow: Facebook Twitter Google+
Subscribe: RSS Feeds Email Newsletters
Latest Headlines Health & Medicine Mind & Brain Space & Time Matter & Energy Computers & Math Plants & Animals Earth & Climate Fossils & Ruins