Brand management in energy sector

MSc!in!Economics!and!Business!Administration!

Department!of!Marketing!

Master!Thesis!
Marketing!Communication!Management! !

Brand!Management!in!the!Energy!Sector!
"a!means"end!approach!to!identify!and!build!sources!to!brand!equity! in!a!B2B!green!energy!context!in!Norway! !
! ! ! ! ! ! ! Date!of!submission!18.09.2009!
!

! Student:!Bjørnar!Johansen!
!

!!!!!!!!Signature:!!

!!!!Supervisor:!Anders!Due!
!

Copenhagen!Business!School!2009!

! ! !

4!

!!!!!!!!Brand!Management!in!the!Energy!Sector! !

Executive!Summary!
By!Bjørnar!Johansen,!September!2009! In!the!recent!decade,!deregulations!in!energy!markets!across!Europe!has!opened!previously! monopolistic!environments!and!opened!for!free!market!competition.!The!Norwegian!Government!has!initiated!a!restructure!process!to!convert!from!oil,!gas!and!electricity!over! to!alternative!energy!sources.!One!of!its!targets!is!to!increase!bio"energy!production!with!14! TWh!within!2020.!It!has!opened!an!attractive!window!of!opportunity!for!private!investors! and!biomass!heating!plant!suppliers.! An!attractive!biomass!heating!plant!industry!emerges!within!the!water"borne!heat!market!in!Norway.!It!seems!reasonable!to!classify!the!emerging!industry!as!a!B2B!context.!Thus,! branding!principles!adopted!from!B2B!theories!should!apply!well!to!the!given!industry.!It! offers!an!opportunity!for!suppliers!of!heating!plants!to!escape!from!pure!price!competition.!! Consumers!in!the!industry!are!affected!by!the!perceived!risk!associated!with!biomass.!They!must!accept!higher!risk!compared!with!solutions!that!run!with!oil,!gas!or!electricity.!It!could! explain!why!common!buying!situations!in!the!industry!call!for!large!and!confusing!buying! centers!where!members!are!made!up!from!various!companies.!Four!roles!often!make!all! major!decisions!throughout!the!buying!process;!initiators,!deciders,!consultants!and!users.!!The!means"end!theory!is!applied!to!the!industry!in!order!to!identify!sources!to!brand!equity.! By!conducting!research!on!respondents!classified!as!decider!or!consultant,!results!indicate!a! range!of!implications!for!brand!management.!First,!respondents!appear!to!be!influenced!by! more!rational!and!more!emotional!factors.!Second,!results!indicate!deciders!and!consultants!are!influenced!by!different!underlying!needs,!values!or!motivations!according!to!their!role.! And!last,!while!research!identified!expected!sources!to!brand!equity,!it!was!not!confirmed! that!green!branding!initiatives!influence!their!crucial!decisions.!! Data!collected!provide!knowledge!about!the!competitive!frame!of!reference!and!positioning! guidelines.!An!analytical!framework!is!constructed!in!order!to!discuss!proper!points"of"parity!and!points"of"difference!associations!in!the!industry.!Results!indicate!four!relevant!position! considerations!in!the!industry.!Given!the!B2B!context,!additional!implications!are!discussed! by!balancing!top"down!and!bottom"up!brand!management!activities.!!

!

!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!Brand!Management!in!the!Energy!Sector!

5

!

!

6!!!!!!!!!Brand!Management!in!the!Energy!Sector! !

Contents!
Executive!Summary!
Date!of!submission!18.09.2009!...........................................................................................................!3! Student:!Bjørnar!Johansen!..................................................................................................................!3!Chapter!1!"!Introduction!..........................................................................................................................!9! 1.2! 1.3! 1.4! Problem!Identification!...........................................................................................................!10! Purpose!of!this!Paper!............................................................................................................!10!...