Brand Image Antecedents of Loyalty and Price Premium in Business Markets

Abstract

The purpose of the present paper is to examine how brand image builds brand loyalty and price premium in business markets, focusing on the question whether the same brand image elements make customers become loyal as well as pay more. Statistical analysis, based on a survey of professional packaging buyers in eight countries, reveals that brand loyalty and price premium are two distinct customer responses, determined by different brand image elements. Associations to a brand’s company reputation, service relationship ability and product solution are what mainly build brand loyalty, whereas price premium is built solely by associations to the brand’s community. The findings add to existing B2B brand equity work by contributing a more nuanced understanding of the brand image-brand strength relationship. And, establish price premium as a distinct and important brand strength indicator in business markets. It also provides a refined and highly detailed brand image model.