Studying the Financial Impact of Marketing Strategies: Should We Differentiate between B2B and B2C Companies?

Previous research asserts that branding is important for both the business-to-business (B2B) and business-toconsumer (B2C) companies. However, literature is silent about the appropriateness of different types of branding strategies for the two types of companies. B2B and B2C companies are inherently different owing to their widely different operations and consumer bases. Therefore, we propose that different marketing strategies may not be equally valuable for the two types of companies. The present research examines the impact of two types of marketing strategies-advertising and branding strategy-on the shareholder value of companies. In particular, we focus on how these impacts vary across B2B and B2C companies, using a sample of 73 B2B and 78 B2C companies in India. The results reveal that B2B firms are uniformly following corporate branding strategy. In contrast, a significant variation is found in the branding strategies of B2C companies. However, branding strategy of a B2C firm is not associated with its shareholder value. Further, the findings suggest that advertisingexpenditure-shareholder-value relationship holds only for B2C companies, but not for B2B firms. Our results are robust after controlling for relevant control variables. The findings suggest that the marketing managers at B2B companies should not base their marketing decisions solely on the models developed for B2C companies. Further, academic researchers are advised to differentiate between B2B and B2C companies while studying the financial impact of marketing variables.