Industrial component suppliers (CSs) work to enhance profitability by
building brand differentiation with original equipment manufacturers
(OEMs) and indirect industrial buyers (IIBs) through their marketing
investments to each member. However, as a CS increases its marketing
investments to its IIB, the OEM’s profit position is threatened,
motivating the OEM to respond with aligning or opposing behavior. The
results from a three-study, multimethod design indicate that a CS’s
strategy of allocating its marketing investments between its OEM and IIB
increases its brand differentiation, which allows it to capture
increased profits subject to conditions of uncertainty. However, the
results also demonstrate that the OEM does not sit idly by as its CS
invests in building brand differentiation with the IIB; rather, it
reacts with both aligning and opposing behaviors to benefit from the
CS’s investments as well as offset the CS’s gains. [ABSTRACT FROM
AUTHOR]