Supplier-initiated ingredient/component branding: Why and when do some suppliers implement an IC branding strategy and others do not

Based on a thorough literature review and utilizing the Dynamic Capabilities framework as a theoretical underpinning, this study investigates ingredient/component (IC) branding from the IC supplier's perspective. More specifically, it poses and attempts to answer to the following question: Why and when do some suppliers implement an IC branding strategy and others do not? I offer the straightforward contention that ICs that have the ability to differentiate the product that they become part of, on dimensions that are important to end customers, have the potential of becoming successful IC brands. This notion of the IC's capability to differentiate is captured by two of the key constructs in my dissertation model – IC functional differentiation ability (FDA) and IC reputational differentiation ability (RDA). Moreover, the study investigates factors that enhance differentiation ability. I argue that suppliers with higher levels of entrepreneurial orientation (EO) have a higher probability of introducing unique ICs. Finally, my conceptual model also takes in consideration the role of a number of moderating variables (i.e., Technological and Market Turbulence, OEM Power, and Brand Fit) in moderating some of the structural relationships. Data has been collected from IC suppliers in three industries (SIC 35, SIC 36, and SIC 37) utilizing a mail survey. Structural hypotheses were tested using Path Analysis with observed variables in SEM. Moderation hypotheses were tested using Hierarchical Liner Regression (HLR).;Hypotheses testing showed that EO has a positive direct effect on FDA but not RDA and that this effect is moderated by technological turbulence. In other words, as the technological environment turbulence increases, EO's effect on FDA grows stronger. Also, the results showed that RDA (and not FDA) has a positive direct effect on the supplier's plan to brand IC (DV). Further analysis revealed that FDA mediates the relationship between EO and RDA. Moreover, the results indicated that RDA mediates the relationship between FDA and the DV. Finally, the results supported a fully-mediated model with two consequent mediators (EO→FDA→RDA→DV). This dissertation contributes to current branding theory by representing the first empirical investigation that addresses IC branding from the IC supplier's perspective. It highlights the critical role of differentiation ability in implementing an IC branding strategy. Overall, these results of this study show clear evidence that implementing an IC branding strategy is a complex process; it not only requires following certain steps in a specific sequence but it also requires paying attention to certain contingencies while making these steps.