BM Module 7, BM chapter 6,8, 9, 11, MKT Chapter 10, Brand MGMT Final

Basic assumptions of the brand value chain:

- Assumes that the value of a brand resides with customers - Brand value creation process begins when the firm invests - Associated marketing program then affects the customer mindset - Mindset produces brand performance - Market performance arrives at the shareholder value and value of the brand

Factors that affect the extent of effects on customer mindset:

- Competitive superiority - Channel and other intermediary support - Customer size and profile

Brand value creation (4 stages)

1) Firm invests in marketing program 2) associated marketing activity affects customer mind set 3) mindset produces the brand performance 4) investment community considers market performance

Components of a Brand Equity Charter

1) Firm's views of brand equity 2) The scope of key brands 3) Specify the actual and desired equity 4) Explain how brand equity is measured 5) Suggest how marketers should manage brand equity with guidelines 6) Outline how to devise market programs along specific tactical guidelines 7) Specify the proper treatment of the brand

22. The market nicher serves small market segments not being served by larger firms. Nichers account for about ________ of the market in relation to other competitors.

10%

121. Apex Corporation is considered to be a market follower in its industry. About what percentage of a hypothetical market structure would be controlled by market followers such as Apex?

20%

21. In general, a market leader will have about ________ of the total market in relation to other competitors.

40%

The primary goal of a brand equity measurement system is to _____. *brand value chain

Achieve full understanding of the sources and outcomes of brand equity, and relate the two as much as possible.

Scott Bedbury and the CBO

Advocates for a Chief Brand Officer who reports to the CEO - Manager for each brand "Divisional positioning has to be king."

Brand tracking studies involve which of the following?

All of the above Product-Brand Tracking Corporate or Family Brand Tracking (decide most influential brands) Global Tracking

37. All of the following companies have been characterized as being market challengers in their respective fields EXCEPT ________.

Boeing

A structured approach to assessing the sources and outcomes of brand equity is ______.

Brand Value Chains

Customer Mindset

Five Dimensions: - Brand Awareness - Brand Associations - Brand Attitudes - Brand Attachment (adherence or addiction) - Brand Activity Includes everything that exists in the minds of customers with respect to a brand:thoughts, feelings, experiences, images, perceptions, beliefs, and attitudes

Key measures largely predictive of future behavior of prospects and customers in any market:

Functional performance of the product/service Convenience and ease of accessing the product/service Brand personality Pricing and value component

Challenges when interpreting tracking studies:

Marketing measures don't change, so marketers need to phrase questions in a comparative way Difficult to decide on appropriate benchmarks May also have to design benchmark targets with allowance for competitive considerations and the nature of the category

118. According to concepts associated with the idea of a strategic group, which of the following appliance industry competitors would most aptly be described as being a member of a strategic group that has a narrow line, lower manufacturing costs, very high service, and a high relative price of its products?

Maytag

52. Which of the following tennis shoe companies is considered to be a market nicher?

New Balance

Brand value is created by how customers react in 6 main ways:

Price premiums Price elasticities Market share Brand expansion Cost structure Brand profitability

The GAME complementary approach to brand reporting does all of the following EXCEPT:

Provides insight into the market penetration component of the brand value chain It is: A complementary approach that measures both input and outcome metrics; can provide insight into the market performance component of the brand value chain. - GOAL - ID key brands - ACTIVITY - Locate current status - MEASUREMENT - Allocate inputs with specific objectives - EVALUATION - Assess the outputs

According to the program quality multiplier, the ability of the marketing program to affect customer mindset will depend on its __________.

Quality

ROMI

Return on marketing investment

Important financial indicators for stockholder value:

Stock price Price/earning multiple Overall market capitalization of the firm

47. Many companies prefer to follow rather than challenge the market leader. Patterns of ________ are common in capital-intensive, homogeneous-product industries, such as steel, fertilizers, and chemicals. Competitors present similar offers to buyers, usually by copying the leader. Market shares show high stability.

a. "conscious parallelism"

25. As a marketing manager, you have decided to pursue new customers with your established products. Specifically, the new customers that you want are those who might use the product but do not at present. Which of the following strategies is recommended to pursue such a customer market?

a. Market-penetration strategy

16. Once a company has identified its main competitors and their strategies, it must next ask: ________?

a. What are the competitors' objectives

39. All of the following are considered to be viable attack strategies that can be employed by a market challenger EXCEPT ________.

a. counteroffensive attack

115. Each marketing manager needs to be aware of the industry in which they compete. Industries can be classified according to all of the following EXCEPT ________.

a. degree of usage of promotion

126. Firms that occupy second, third, and lower ranks in an industry can adopt two postures in responding to competition. First, they can attack the leader and other competitors in an aggressive bid for further market share. Second, they can ________.

a. play ball and not "rock the boat" (market followers)

Some reasons that brand equity metrics may not always be helpful include

all of the above

5. A segment is unattractive if the company's suppliers are able to raise prices or reduce quantity supplied. Which of the following is the best illustration of the threat of suppliers' growing bargaining power?

b. Oil companies must purchase a significant amount of their product from OPEC.

46. Which of the following best describes the premise of Theodore Levitt's "Innovative Imitation" article?

b. Product imitation might be as profitable as a strategy of product innovation.

1. Michael Porter has identified five forces that determine the intrinsic long-run attractiveness of a market or market segment. Which of the following would NOT be among Porter's five forces?

b. Technological partners

20. ________ competitors try to buy market share rather than earn it; take large risks; invest in overcapacity; and upset industrial equilibrium.

bad

23. The aim of benchmarking is to copy or improve on ________, either within an industry or across industries.

best practices

A _________ is a set of organizational processes designed to improve the understanding and use of the brand equity concept within a firm.

brand equity management system

A _________ assembles the results of the tracking survey and other relevant performance measures for the brand.

brand equity report

The ____ should explain what is happening with the brand, as well as why it is happening. Summarizes consumer perceptions Includes market-level information (product shipments, retail category trends, relevant cost breakdowns, price and discount schedules, sales and market share information, and profit assessments)

brand equity report

42. A marketing manager of a market challenger-type organization has decided to "leapfrog" competition by moving into cutting-edge technologies. This indirect approach to attacking competition can be characterized as being what is called the ________.

bypass attack

122. When a regional computer-manufacturing firm began to seek out customers who lived outside of its traditional market boundaries, the firm was employing which of the following new customer expansion strategies to expand its total market?

c. Geographic-expansion strategy

15. An example of a strategic group in the appliance industry would be one where ________.

c. competitors had broad lines, medium manufacturing costs, low service responsibility, and low prices

40. According to attack strategies available to the market challenger, the ________ can be used when the challenger spots areas where the opponent is underperforming.

c. flank-geographic-attack

26. One of the market leader strategies for expanding the total market is to focus on more usage. Two avenues are open for doing this: increasing the frequency of consumption or ________.

c. increasing the level or quantity of consumption

49. As a market follower strategy, the ________ emulates the leader's products, name, and packaging, with slight variations.

cloner

57. Which of the following types of companies is characterized as having a "fighter orientation"?

competitor-centered

58. Which of the following types of companies is characterized as being "too reactive"?

competitor-centered

13. Using the market approach, ________ are companies that satisfy the same customer need.

competitors

59. Which of the following types of companies is felt to be in a better position to identify new opportunities?

consumer-centered

28. Market leaders are constantly under attack from large and small competitors alike. What is the most constructive response a market leader can make when defending its terrain?

continous innovation

When to track?

contuniously

125. In satisfying customer needs, a ________ marketer discovers and produces solutions customers did not ask for but to which they enthusiastically respond. Sony is a good illustration of such a marketer.

creative

60. In a ________ company, the obsession of the company is with the customer, not the competition.

customer-centered

127. To industry leader Boeing, European Airbus is a serious market challenger that has made rapid gains in the commercial aircraft market in the last few years. Which of the following has been cited as the chief strategy being employed by Airbus in its battle with Boeing?

d. An innovative new product line equipped with modern features.

34. Market broadening and market diversification are likely tactics employed in which of the following market leader defensive strategies?

d. Counteroffensive defense

123. When your competitor delivers more for less, two strategies can be employed to meet this threat. Such a situation was recently faced by Kmart. Which of the following combinations would be most appropriate to meet the challenge thrown-down by the competitor?

d. Differentiation or execution

116. The oil and steel industries have unique industrial structure. Which of the following industry structural types is usually associated with the oil and steel industries?

d. Pure oligopoly

54. The key idea in successful nichemanship is specialization. Which of the following specialists would most closely be identified with the characterization of being an organization that limits its selling to one customer?

d. Specific-customer specialist

24. Being a market leader is often a difficult position to maintain and defend. The market leader must protect its current market share through good defensive and offensive actions. Second, the firm can try to increase its market share, even if the market size remains constant. What is the third course of action recommended for market leaders?

d. The firm must find ways to expand total market demand.

4. Wal-Mart is perhaps one of the best illustrations of the threat of ________ found in Porter's model.

d. buyers' growing bargaining power

114. Marketing managers must be keenly aware of ________—a focus on current competitors rather than latent ones—or risk becoming extinct.

d. competitor myopia

38. A market challenger must decide who to attack. All of the following are considered as likely possible targets (as per information found in the text) EXCEPT ________.

d. it can attack a global conglomerate that is market hungry

44. All of the following are considered to be valid market challenger attack strategies EXCEPT ________.

d. partnerships with rival market leaders

35. Because the cost of buying higher market share may far exceed its revenue value, a company should consider four factors before pursuing increased market share. All of the following would be among those four factors EXCEPT ________.

d. the likelihood that an award-winning promotional campaign can be generated

36. Some market leaders have increased profitability by selectively ________ market share in weaker areas.

decreasing

27. To counter value-based players, it will be necessary to focus on areas where their business models give other companies room to maneuver. For example, instead of directly competing with Wal-Mart and other retailers, Walgreen's emphasizes convenience across all elements of its business. Which of the following general strategies is Walgreen's using as its main competitive focus?

differentiation

56. Which of the following strategies for entering a market held by incumbent firms would be best if the desire was to position away from the dominant brand with a comparable or premium price and heavy advertising spending to establish the new brand as a credible alternative?

differentiation

45. Avon became a major cosmetics company by perfecting door-to-door selling instead of battling other cosmetic firms in conventional stores. This is an example of which of the following specific market challenger attack strategies?

distribution innovation

120. Chevrolet competes with Ford, not with Ferrari. Which of the following statements (characterizations) of competitors most aptly fits with the competitive situation faced by Chevrolet when it seeks optimum selection of competitors?

e. Compete with close competitors.

41. Sally Seabrook is an up-and-coming marketing manager for a large department store chain. Ms. Seabrook has distinguished herself with bold strategies such as launching attacks on her primary competitor from several fronts (including advertising, new store openings, price cuts, new distributor alliances, and creative merchandising). Her "blitz" is comparable to any done by the military in time of war. Which of the following market challenger attack strategies is Ms. Seabrook using to attack her competition?

e. Encirclement attack

43. A market challenger strategist must carefully consider all attack options before moving forwards. If the strategist chooses the ________ approach, selective price cuts, intense promotional blitzes, and occasional legal action will probably be commonplace in the strategic design.

e. guerilla warfare

117. All of the following are considered to be exit barriers in a marketplace that must be considered by the marketing manager EXCEPT ________.

economies of scale

11. If a marketer is facing government restrictions, high vertical integration, emotional barriers, low asset-salvage value due to obsolescence, and legal obligations to creditors, the marketer is most likely facing what are called ________ barriers in a marketplace.

exit

32. A marketing manager has planned a strategy that will require that the organization erect outposts to protect its weak front-running brands. Because these outposts will be central to the organization's new competitive strategy, we can say that a ________ defense is being used.

flank

Which of the following companies saw sales plummet from a peak of $7.1 billion in 1996 to about $4 billion in 2003 in part because of fierce competition in the fashion jeans business?

h. Levi Strauss

53. In terms of comparisons with a market leader, whereas the market leader achieves high volume, the market nicher achieves ________.

high margin

50. As a market follower strategy, the ________ copies some things from the leader but maintains differentiation in terms of packaging, advertising, pricing, or location. This strategy is tolerated by the market leader as long as the follower's aggressiveness does not mount.

imitator

128. When Avis used the campaign theme, "We're only second. We try harder." to battle rival Hertz, Avis was using a market challenger strategy called ________.

improved services

6. A(n) ________ is a group of firms that offer a product or class of products that are close substitutes for one another.

industry

48. All of the following are considered to be viable market follower strategies EXCEPT ________.

innovator

29. Caterpillar has become dominant in the construction-equipment industry despite charging a premium price and being challenged by a number of able competitors. All of the following have been cited as policies used by Caterpillar to meet its competitors EXCEPT ________.

limited-line strategy

51. An alternative to being a market follower in a large market is to be a leader in a small market. This type of competitor is called a(n) ________.

market nicher

30. Sony is an unusual market leader. It gives its customers new products that they have never even asked for (e.g., Walkmans, VCRs, video cameras, CDs). This makes Sony a(n) ________ firm.

market-driving

7. When only one firm provides a certain product or service in a certain country or area a ________ exists.

monopoly

31. ________ defense involves occupying the most desirable market space in the minds of the consumers, making the brand almost impregnable.

position

33. The "best defense is a good offense" would be a policy under which of the following market leader defensive strategies?

preemptive defense

113. During the 2004 holiday season ________ from discounters Wal-Mart, Target, and even electronics vendors such as Best Buy and Circuit City has pummeled the toy chains and sent some of them into bankruptcy.

pricing pressure

10. All of the following are considered to be major entry barriers in markets EXCEPT ________.

product or service line

55. A market nicher is considered to be a ________ specialist if the firm specializes in producing a certain type of product or product feature such as Rent-a-Wreck that rents only "beat-up" cars.

product-feature

Brand Equity Charter

provides relevant guidelines to marketing managers within the company as well as to key marketing partners outside the company such as ad agency staff

Which of the following is NOT among the three steps of implementing a brand equity management system?

research brand equity data 1) 2) 3)

17. In general, a company should monitor the following variables when analyzing competitors: ________, share of mind, and share of market.

share of heart

119. When a buyer thinks of performance running shoes, the first name that comes to mind is Nike. Which of the following variables for analyzing competition would most aptly apply given the statement above?

share of mind

8. Which of the following would be the best illustration of a pure oligopoly?

steel

9. Which of the following is often considered to be a good illustration an industry structure type known as pure competition?

stock market

14. A group of firms following the same strategy in a given target market is called ________.

strategic group

3. A segment is unattractive when there are actual or potential ________ for the product.

substitutes

124. Which of the following methods for defending market share should be employed by Caterpillar to hold off competitors when Caterpillar learned that many competitors were lacking in delivering on parts commitments to customers?

superior service

2. Which of the following would be the most likely threat that is associated with potential new entrants in Porter's segment structural attractiveness model?

threat of mobility

112. A market segment's attractiveness varies with the height of its entry and exit barriers. Which of the following forces as described by Michael Porter would most likely be the force being examined if the above situation were to be considered by a marketing manager?

threat of new entrants

12. Major oil producers carry on oil exploration, oil drilling, oil refining, chemical manufacture, and service-station operation. When an organization does all of these separate tasks within a distribution channel they can be said to have achieved what is called ________.

vertical integration

19. Most companies aim their competitive shots at ________ competitors, because this requires fewer resources per share point gained.

weak