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B2B branding: A financial burden for shareholders?

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  • Ohnemus, Lars

Abstract

Is branding an effective tool for generating shareholder wealth for companies that are active in a business-to-business environment? Or, do other factors such as innovation and manufacturing efficiency--or the lack thereof--create or destroy shareholder wealth? Based on an examination of almost 1,700 companies listed either on the United States or European stock exchanges, this study reveals this crucial relationship could be described as a W-shaped curve with five distinctive phases, depending on the strategic branding position of the company. Used strategically, business-to-business (B2B) companies with a balanced corporate brand strategy generally yield a return to their shareholders that is 5%-7% higher. It is therefore vital that key executives, including the board of directors, systematically assess and monitor the strategic branding position of their company and how their branding investments are performing against key competitors. This study reveals that shareholders should insist on systematic performance feedback from the corporation regarding all key items in the balance sheet--including branding. As disclosed herein, very few of the companies analyzed possessed an optimal balance between branding and financial performance.

Suggested Citation

  • Ohnemus, Lars, 2009. "B2B branding: A financial burden for shareholders?," Business Horizons, Elsevier, vol. 52(2), pages 159-166.
    • Handle: RePEc:eee:bushor:v:52:y:2009:i:2:p:159-166
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    References listed on IDEAS

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    1. Philip Kotler & Waldemar Pfoertsch, 2006. "B2B Brand Management," Springer Books, Springer, number 978-3-540-44729-0, October.
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    3. Lars Ohnemus & Per V. Jenster, 2007. "Corporate Brand Thrust and Financial Performance: An Examination of Strategic Brand Investments," International Studies of Management & Organization, Taylor & Francis Journals, vol. 37(4), pages 84-107, January.
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    Cited by:

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    2. Gustafson, Brandon M. & Pomirleanu, Nadia & John Mariadoss, Babu & Johnson, Jean L., 2021. "The social buyer: A framework for the dynamic role of social media in organizational buying," Journal of Business Research, Elsevier, vol. 125(C), pages 806-814.
    3. Wen-Hsiang Yu & Chuang-Chun Chiou, 2022. "Effects of Sustainable Development of the Logistics Industry by Cloud Operational System," Sustainability, MDPI, vol. 14(16), pages 1-28, August.
    4. Seyedghorban, Zahra & Matanda, Margaret Jekanyika & LaPlaca, Peter, 2016. "Advancing theory and knowledge in the business-to-business branding literature," Journal of Business Research, Elsevier, vol. 69(8), pages 2664-2677.
    5. Anne Maria Stefani, 2017. "The Brand Effect - Living the Brand in Negotiations," Journal of Emerging Trends in Marketing and Management, The Bucharest University of Economic Studies, vol. 1(1), pages 210-215, October.
    6. Vonny Susanti & Andreas Samudro, 2022. "Assessing the Role of Corporate Reputation on Brand Satisfaction: A Study of Chemical Industry," Corporate Reputation Review, Palgrave Macmillan, vol. 25(2), pages 122-138, May.

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