Which types of multi-stage marketing increase direct customers' willingness-to-pay? Evidence from a scenario-based experiment in a B2B setting

The present study investigates empirically which types of multi-stage marketing by a business-to-business supplier affect its direct customers' willingness-to-pay. We conceptually develop comprehensive and selective multi-stage marketing as well as multi-stage awareness as distinct types of this concept. Their properties lead to differentiated hypotheses concerning their effects on direct customers' relationship value perceptions and perceived price importance which in turn influence willingness-to-pay. The paper also demonstrates how the direct customers' power position toward their own customers affects the effectiveness of a supplier's multi-stage marketing endeavors. We conduct a scenario-based, experimental study among 103 knowledgeable purchasing managers in customer companies to the adhesives industry, measuring willingness-to-pay, perceived relationship value, and price importance with a limit conjoint analysis. Multi-level modeling is used to test our hypotheses. The results show that comprehensive multi-stage marketing significantly increases purchasing agents' willingness-to-pay, mostly through their relationship value perception, and especially when the customer company is in a less powerful position toward its own customers. For managers, our study highlights the benefits of comprehensive multi-stage marketing over the other multi-stage marketing types.