Ingredient Brand Versus Host Brand in Smartphone Market

Abstract

New market rules have changed the structure of market and pushed firms for new strategies to compete and survive in uncertain and competitive environment. Some significant market realities, such as easiness in gaining knowledge about product/service, and attainability alternative brands, forced organizations to find out new ways to reach market success, in addition to traditional competition tools. Firms must supply attractive and novel products faster and better while developing and presenting new ideas. However, not only either own brand or product/service capabilities may not be adequate for producing and marketing new products, but also firm may not perform these with sufficient speed. Hence, in the term of branding, marketers have increasingly turned to brand alliances strategies such as co-branding (e.g. Nike–Apple), composite branding (e.g. Special K frozen waffles) and ingredient branding (e.g. Intel–Dell). Previous studies are mostly conceptual and empirical works revealing success of ingredient marketing strategies. They have majorly focused on retail products or some widely known technological products with similar ingredient brand examples. In this study we attempt to examine the importance of host and ingredient brand separately for consumer/user buying influence, and discuss results according to the current smartphone market developments in order to shed light to academicians and practitioners for further studies and practices in the market. We have asked to respondents to measure the importance of phone (host brand), operating system (OS) (ingredient brand), and to compare with the OS brand results, processor brand (ingredient brand) in interval-level. Also, respondents were asked in categorical-level for their role in buying the smartphone, and other demographic questions. The results of this study show that smartphone, OS and processor brand are related with consumer/user’s influence for buying smartphones. Additionally, descriptive statistics present deeper insights about consumer approaches. For instance, the most of participants, who highlight the phone brand, OS brand and processor brand as important or extremely important, make own decision when they purchase the smartphone. This study draws attention to that more research on this topic is essential to understand more clearly whether general brand strategies and concepts are adequate and compatible for ingredient branding. Hence, ingredient brands should be examined academically and practically for deeper insights, not only for smartphone market, but also for other markets/products.