Brand, Identity and Reputation: Exploring, Creating New Realities ...

B2B Brand Equity: Understanding the Effects of
Switching Costs, Quality of Alternatives, and Customer-Employee Rapport
Galina Biedenbach, Umeå University, Sweden
Purpose
The main purpose of the study is to investigate the effects of switching costs, quality of alternatives and customeremployee
rapport on the development of B2B brand equity. The process of brand equity development is captured in this
study through the hierarchical effects between four dimensions of brand equity. Besides evaluating the impact of
switching costs and quality of alternatives on B2B brand equity, the study investigates the impact of more affective and
experiential factor, which is customer-employee rapport. In addition to evaluating the impact of these factors on brand
awareness, brand associations, and perceived quality, the study compares the specific effects that switching costs,
quality of alternatives, and customer-employee rapport have on brand loyalty, which is the final dimension in the
process of brand equity development.
Design/Methodology/Approach
The brand equity concept is conceptualized in the study as ―the differential effect of brand knowledge on consumer
response to the marketing of the brand‖ (Keller, 1993). Following the classical model (Aaker, 1991), brand equity is
formed by four dimensions, which are brand awareness, brand associations, perceived quality, brand loyalty. The
relevance of these four dimensions is shown in previous studies on B2B brand equity (Bendixen, Bukasa, & Abratt,
2004; Hutton, 1997; Michell, King, & Reast, 2001; van Riel, de Mortanges, & Streukens, 2005). However, most of
these studies utilize only some dimensions of brand equity in their conceptual models. Only three previous studies
provide some empirical evidence about four dimensions of B2B brand equity and the hierarchical effects between these
dimensions (Biedenbach & Marell, 2010; Gordon, Calantone, & di Benedetto, 1993; Kim & Hyun, 2010). The study
advances knowledge on B2B brand equity by providing additional empirical evidence about the hierarchy of effects,
which captures the process of brand equity development from brand awareness to brand associations, and then to
perceived quality and brand loyalty. Furthermore, the study makes a theoretical contribution by examining the impact of
such important factors as switching costs, quality of alternatives, and customer-employee rapport on this process.
The traditional view upon the organizational buying behavior emphasizes the relevance of more rational and cognitive
factors, for example functionality and performance, for the choice of goods and services in the B2B setting (Anderson,
Narus, & Narayandas, 2009). While consideration of switching costs and quality of alternatives is more in line with this
traditional view, the consideration of customer-employee rapport highlights the importance that affective factors have in
the organizational buying behavior. Since most of the studies on B2B brand equity focused on analyzing brand equity of
goods, more affective factors, which are extremely relevant for the choice and consequently for brand equity of B2B
services, are rather unexplored in previous research. The study aims to address this gap in research by considering the
impact of customer-employee rapport on the dimensions of brand equity. Customer-employee rapport is conceptualized
in this study as ―a customer‘s perception of having an enjoyable interaction with a service provider employee,
characterized by a personal connection between the two interactants‖ (Gremler & Gwinner, 2000, p. 92). Considering
the positive effect of customer-employee rapport on customer perception of interaction with company employee, this
factors is expected to have positive effect on brand equity. Similarly high switching costs, which are the costs of
switching to alternative service provider (Lam, Shankar, Erramilli & Murthy, 2004), are hypothesized to have positive
effect on brand equity. High quality of alternatives, which is the evaluation of quality of the best alternative brand
(Breivik & Thorbjørnsen, 2008), is expected to have negative effect on brand equity.
The data was collected as a part of the follow-up study investigating the development of B2B brand equity, its
antecedents and consequences in the professional services industry. The CEOs and CFOs of companies buying auditing
and business consultancy services from one of the Big Four auditing companies were chosen as the respondents. The
response rate was equal to 21% (n=632). The comparison of the respondents with the non-respondents on their turnover
and number of employees (Armstrong and Overton, 1977; Collier and Bienstock, 2007) did not identify the nonresponse
bias. The measures of the constructs were adapted from previous research on brand equity (Aaker, 1991, 1996;
Aaker, 1997; Biedenbach & Marell 2010; Koçak, Abimbola, & Özer, 2007; Pappu, Quester, & Cooksey 2005;
Washburn & Plank 2002; Yoo & Donthu 2001), switching costs (Lam, Shankar, Erramilli & Murthy, 2004), quality of
alternatives (Breivik & Thorbjørnsen, 2008), and customer-employee rapport (Gremler & Gwinner 2000; Hennig-
Thurau, Groth, Paul, & Gremler, 2006). Structural equation modeling was used to examine the hypothesized effects.
Findings
The results of the study show significant hierarchical effects between brand association, perceived quality, and brand
loyalty. The lack of effect between brand awareness and brand association can be explained by specifics of the selected
sample. Due to direct experience with the company employees, the respondents might tend to develop brand
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