Marketing Management Chap 11
56) Brand salience describes the extrinsic properties of the product or service, including the ways in which the brand attempts to meet customers' psychological or social needs.
FALSE
57) Brand imagery is a consumer's emotional response and reaction with respect to the brand.
FALSE
84) Brands are built only by advertising.
FALSE
88) Modifying a brand to suit group-level or individual needs is called staking.
FALSE
30) According to Young and Rubicam's BrandAsset® Valuator, a brand's ________ measures how well the brand is regarded and respected. A) differentiation B) energy C) relevance D) esteem E) knowledge
D
49) With respect to the brand building pyramid, the branding objective of developing deep, broad brand awareness corresponds to which of the following "building block levels"? A) resonance B) imagery C) performance D) salience E) judgment
D
119) A major advantage of a ________ strategy is that the company does not tie its reputation to the product. A) blanket family name B) licensing C) separate family brand name D) category extension E) brand revitalization
C
63) Explain the concept of brand knowledge.
Brand knowledge consists of all the thoughts, feelings, images, experiences, beliefs, and so on that become associated with the brand. In particular, brands must create strong, favorable, unique brand associations with customers.
136) Intrabrand shifts in a company's sales are always undesirable.
FALSE
129) A firm's branding strategy is also called the brand architecture.
TRUE
66) According to the BrandZ model of brand strength, brand building involves a series of five sequential steps. What are those five sequential steps?
The steps are in ascending order: 1. presence 2. relevance 3. performance 4. advantage 5. bonding
148) The decision as to how to brand new products is critical. When a firm introduces a new product, it has three main choices. What are those choices?
The firm can: develop new brand elements for the new product, apply some of its existing brand elements, or use a combination of new and existing brand elements.
94) List the six criteria used in creating brand elements.
The six criteria are: 1. memorable 2. meaningful 3. likable 4. transferable 5. adaptable 6. protectable
58) Describe the three ingredients of customer-based brand equity.
The three key ingredients of customer-based brand equity are as follows: 1. Brand equity arises from differences in consumer response. If no differences occur, the brand-name product is essentially a commodity, and competition will probably be based on price. 2.
23) High levels of brand ________, or the extent to which consumers feel they are "in sync" with the Fox News brand and engagement in Fox News programs, often leads to greater recall of the ads Fox News runs. A) salience B) feelings C) judgments D) resonance E) imagery
D
114) Apple's iPod shuffle is an example of ________. A) a subbrand B) a parent brand C) family brand D) a brand mix E) an umbrella brand
A
118) A ________ consists of all products — original as well as line and category extensions — sold under a particular brand. A) brand line B) co-brand C) generic brand D) licensed product E) subbrand
A
123) The hallmark of an optimal brand portfolio is ________. A) the ability of each brand to maximize equity in combination with all the other brands in it B) the ability of each brand to maximize its individual equity in isolation C) maximum brand overlap D) the eventual reduction of brand differentiation to create a unified brand appearance E) maximum internal competition within the firm
A
124) ________ brands are positioned with respect to competitors' brands so that more important (and more profitable) flagship brands can retain their desired positioning. A) Flanker B) Attacker C) Defender D) Cash cow E) Simulation
A
132) Flankers are brands that may be kept around despite dwindling sales because they manage to maintain their profitability with virtually no marketing support.
FALSE
133) The role of a relatively high-priced brand in a portfolio is often to attract customers to the brand franchise or to "build traffic."
FALSE
135) Brand differentiation occurs when consumers no longer associate a brand with a specific product or highly similar products and start thinking less of the brand.
FALSE
137) In Hershey Kisses candy, Hershey would be considered a branded variant.
FALSE
140) Cash cows, or fighter brands, include products like Busch Bavarian and Intel Celeron, which are positioned with respect to the competitors' brands so that more important and profitable flagship brands can retain their desired positioning.
FALSE
141) A brand that is seen as prototypical of a product category is easy to extend outside the category.
FALSE
144) The most effective advertising strategy for an extension emphasizes the parent brand.
FALSE
90) The indirect approach to assessing brand equity assesses the actual impact of brand knowledge on consumer response to different aspects of marketing.
FALSE
98) How can marketers reinforce brand equity?
Marketers can reinforce brand equity by consistently conveying the brand's meaning in terms of what products it represents, what core benefits it supplies, and what needs it satisfies; and how the brand makes products superior, and which strong, favorable, and unique brand associations should exist in consumers' minds.
79) AT&T's business campaign not only helped to change public perceptions of the company, it also signaled to employees that AT&T was determined to be a leader in telecommunication services. Which principle of internal branding does this example portray? A) choosing the right moment to capture employees' attention and imagination B) furnishing energizing and informative internal communication C) bringing the brand alive for employees D) linking internal and external marketing E) understanding how brand communities work
D
105) Brand ________ is the job of estimating the total financial worth of the brand. A) tracking B) auditing C) equity D) valuation E) harmonization
D
116) A parent brand that is associated with multiple products through brand extensions is also called a(n)________. A) category brand B) subbrand C) extension brand D) family brand E) line brand
D
120) Starbucks introduced ice creams in the same flavors as the Frappuccinos it sold in its coffee shops. This is an example of ________. A) brand dilution B) co-branding C) brand variants D) category extension E) brand harmonization
D
154) In its focus on bottom-line financial value, the ________ approach often overlooks the "option value" of brands and their potential to affect future revenues and costs. A) brand equity B) brand value chain C) customer tracking D) customer equity E) brand extension
D
117) The introduction of Diet Coke by the Coca-Cola Company is an example of ________. A) line extension B) brand harmonization C) category extension D) brand dilution E) co-branding
A
12) When a consumer expresses thoughts, feelings, images, experiences, and beliefs associated with the brand, the consumer is expressing ________. A) brand knowledge B) ethnocentric bias C) self-serving bias D) cognitive dissonance E) brand identity
A
74) Which of the following is a defensive criterion for choosing brand elements? A) adaptable B) memorable C) meaningful D) likeable E) significance
A
95) As a brand manager you would like to have your brand (brand name) be protectable. Explain what you mean by "protectable" and give an illustration.
As a brand manager you would need to consider questions like, "How legally protectable is the brand element?" "How competitively protectable is the brand element?" and "Can it be easily copied?" It is important that names that become synonymous with product categories — such as Kleenex, Kitty Litter, Jell-O, Scotch Tape, Xerox, and Fiberglass — retain their trademark rights and not become generic.
9) Brand ________ is the added value endowed to products and services. A) loyalty B) equity C) preference D) identity E) licensing
B
127) Even if sales of a brand extension are high and meet targets, the revenue may be coming from consumers switching to the extension from existing parent-brand offerings — in effect ________ the parent brand. A) diluting B) cannibalizing C) reinforcing D) eroding E) revamping
B
61) Define brand equity.
Brand equity is the added value endowed to products and services. This value may be reflected in how consumers think, feel, and act with respect to the brand, as well as the prices, market share, and profitability that the brand commands for the firm.
150) Define brand variants.
Brand variants are specific brand lines supplied to specific retailers or distribution channels. They result from the pressure retailers put on manufacturers to provide distinctive offerings.
68) From a marketing management perspective, there are three main sets of brand equity drivers. Which of these drivers was most applicable when McDonald's decided to use the "golden arches" and Ronald McDonald as symbols of their brand? A) the product and all accompanying marketing activities and supporting marketing programs B) the service and all accompanying marketing activities and programs C) the initial choices for the brand elements or identities making up the brand D) associations indirectly transferred to the brand by linking it to some other entity E) the profitability associated with brand development
C
75) With respect to powerful brand elements, ________ is an extremely efficient means to build brand equity. This element functions as a useful "hook" to help consumers grasp what the brand is and what makes it special. A) the tangibility of a product B) a product's shape C) a slogan D) a patent E) a copyright
C
147) In what ways can brand extensions improve the odds of new-product success?
Consumers make inferences and form expectations about the composition and performance of a new product based on what they already know about the parent brand and the extent to which they feel this information is relevant to the new product. By setting up positive expectations, extensions reduce risk and may make it easier to convince retailers to stock and promote a brand extension because of increased customer demand. From a marketing communications perspective, an introductory campaign for an extension doesn't need to create awareness of both the brand and the new product, but instead can concentrate on the new product itself.
100) The ________ determines the marketing program's ability to affect the customer mindset and is a function of the quality of the program investment. A) customer multiplier B) market multiplier C) shareholder value D) program multiplier E) price elasticity
D
22) ________, which combines the BrandAsset® Valuator dimensions of energized differentiation and relevance, is a leading indicator that predicts future growth and value. A) Brand stature B) A brand's power grid C) Brand presence D) Brand bonding E) Brand strength
E
25) According to BrandAsset® Valuator model, energized differentiation and relevance, the two pillars of brand equity combine to determine what is called brand ________. A) position B) image C) depth D) knowledge E) strength
E
34) A consumer who expresses rational and emotional attachments to a brand to the exclusion of most other brands has reached the ________ level in the BrandDynamics Pyramid. A) advantage B) relevance C) presence D) performance E) bonding
E
73) If consumers can easily recall and recognize a brand element, the brand element is said to be ________. A) meaningful B) protectable C) adaptable D) transferable E) memorable
E
126) According to Ries and Trout, Cadbury suffered from ________ when the company allowed its brand to become diluted by putting their name on such variants as mashed potatoes, powdered milk, and soups, apart from chocolates and candies. A) liquidity trap B) cognitive dissonance C) branding fallout D) cannibalization E) line-extension trap
E
44) With respect to the brand building pyramid, at which of the following "building block levels" would we expect the consumer to develop an intense, active loyalty? A) salience B) imagery C) feelings D) judgments E) resonance
E
45) With respect to the brand building pyramid, at which of the following "building block levels" would we expect the consumer to develop positive and accessible reactions? A) resonance B) salience C) imagery D) performance E) feelings
E
156) Customer equity is synonymous with brand equity.
FALSE
5) Physical goods, services, and stores can be branded, but ideas and people cannot.
FALSE
51) Brand equity arises from unanimity in consumer response.
FALSE
83) If a brand element has the characteristic of being memorable, the brand is credible and suggestive of the type of person who might use the brand.
FALSE
107) Brand equity is essentially the same as brand valuation.
FALSE
108) When Interbrand uses competitive benchmarking and a structured evaluation of the brand's clarity, commitment, protection, responsiveness, relevance, differentiation, consistency, presence, and understanding to determine the likelihood the brand will realize forecasted Brand Earnings, it is calculating Brand Value.
FALSE
151) Kellogg's uses its corporate brand name with its individual product brands as with Kellogg's rice krispies, Kellogg's raisin bran, and Kellogg's corn flakes. Which branding strategy is being used by the company?
Kellogg's employs a subbrand or hybrid branding strategy by combining the corporate brand with individual product brands as with Kellogg's Rice Krispies, Kellogg's Raisin Bran, and Kellogg's Corn Flakes.
145) As a branding manager, you have recommended to your board of directors a corporate policy of umbrella branding. What are the advantages that your company might gain from this?
Many firms, such as Heinz and GE, use their corporate brand as an umbrella brand across their entire range of products. A corporate umbrella brand name has a number of advantages. Development cost is less because there is no need for "name" research or heavy advertising expenditures to create brand-name recognition. Furthermore, sales of the new product are likely to be strong if the manufacturer's name is good. Corporate-image associations of innovativeness, expertise, and trustworthiness have been shown to directly influence consumer evaluations. Finally, a corporate branding strategy can lead to greater intangible value for the firm.
149) Nichepro Technologies, who were mainly into producing personal computers and laptops, have now decided to produce Nichepro health care products. Explain the branding strategy advocated by the company.
Nichepro Technologies are advocating brand extension strategy. Brand extensions fall into two categories: line extension and category extension. Marketers use the parent brand to enter a different product category, in category extension. Nichepro is adopting the same strategy by using their parent brand to enter the healthcare products category.
113) Provide an example of brand revitalization. Evaluate its success and note any factors that contributed to or possibly hurt its success.
Student responses will vary. Examples from the text include Burberry, GM/Cadillac, Harley Davidson, PBR, Mountain Dew. Brand revitalization of almost any kind starts with the product.
106) The brand audit can be used to set strategic direction for the brand.
TRUE
128) When a parent brand covers a new product within a product category it currently serves, it is called a line extension.
TRUE
92) When change is necessary, marketers should vigorously preserve and defend sources of brand equity.
TRUE
model? List and briefly characterize the four key components (pillars) of brand equity.
The BAV model is based on research of almost 800,000 consumers in 51 countries. BAV provides comparative measures of the brand equity of thousands of brands across hundreds of different categories. There are four key components — or pillars — of brand equity. These pillars are: 1. energized differentiation — measures the degree to which a brand is seen as different from others, and its perceived momentum and leadership 2. relevance — measures the appropriateness and breadth of a brand's appeal 3. esteem — measures perceptions of quality and loyalty, or how well the brand is regarded and respected 4. knowledge — measures how aware and familiar consumers are with the brand
7) Assume you are a marketing manager and want to adopt strategic brand management. List the four main steps that you would most likely go through to accomplish this task.
The steps would be: 1. identifying and establishing brand positioning 2. planning and implementing brand marketing 3. measuring and interpreting brand performance 4. growing and sustaining brand value
96) Identify the three important principles for internal branding.
Three important principles for internal branding are: 1. choosing the right moment 2. linking internal and external marketing 3. bringing the brand alive for employees
21) Starbucks uses social-media engagement to respond, listen to and connect with fans, which is important to them because it builds loyalty, which is one aspect of the ________ pillar of the BrandAsset® Valuator. A) energized differentiation B) esteem C) relevance D) knowledge E) strength
B
131) Increasing shelf presence and retailer dependence in the store is one of the reasons for introducing multiple brands in a category.
TRUE
134) Brand extensions can reduce the costs of introductory launch campaigns and make it easier to convince retailers to stock and promote a new product.
TRUE
138) Marketers must judge each potential brand extension by how effectively the brand leverages existing brand equity from the parent brand, as well as how effectively, in turn, it contributes to the parent brand's equity.
TRUE
4) Consumers may evaluate identical products differently depending on how they are branded.
TRUE
50) One of the advantages of having a strong brand is the ability to have a more elastic consumer response to price decreases of the brand.
TRUE
53) According to BrandAsset® Valuator (BAV) model, knowledge is one of the key components of brand equity.
TRUE
55) Under the BrandZ model of brand strength, customers who are bonded to the brand believe "nothing else beats it."
TRUE
82) One of the selection criteria for creating a successful brand element is that it should be protectable.
TRUE
85) To achieve integrated marketing, marketers need a variety of different marketing activities that consistently reinforce the brand promise.
TRUE
86) Brand equity can be built by linking the brand to sources, such as channels of distribution as well as to other brands.
TRUE
97) Given that the power of a brand resides in the minds of consumers and how it changes their response to marketing, there are two basic approaches to measuring brand equity. Briefly, describe each of these approaches.
The two approaches are: 1. an indirect approach that assesses potential sources of brand equity by identifying and tracking consumer brand knowledge structures 2. a direct approach that assesses the actual impact of brand knowledge on consumer response to different aspects of the marketing
26) According to BrandAsset® Valuator model, esteem and knowledge, the two pillars of brand equity together create brand ________, a "report card" on past performance and a current indicator of current value. A) stature B) parity C) strength D) personality E) architecture
A
19) BENGAY aspirin, Cracker Jack cereal, Frito-Lay lemonade, and Fruit of the Loom laundry detergent are examples where consumers' ________ dictated that the extensions were inappropriate for the brand. A) brand knowledge B) brand equity C) brand stature D) power grid E) brand salience
A
39) According to the BRANDZ model of brand strength, brand building involves people progressing through a sequential series of steps. Which of these steps convey the message "Nothing else beats this brand"? A) bonding B) relevance C) advantage D) performance E) presence
A
42) With respect to the "six brand building blocks," brand ________ describes the extrinsic properties of the product or service, including the ways in which the brand attempts to meet customers' psychological or social needs. A) imagery B) judgment C) resonance D) salience E) performance
A
48) Which of the following "building block levels" corresponds to the branding objectives of points-of-parity and difference? A) performance and imagery B) judgment and feelings C) resonance and salience D) imagery and judgment E) salience and feelings
A
78) ________ branding consists of activities and processes that help inform and inspire employees about brands. A) Internal B) Personal C) Individual D) External E) Co-
A
80) A brand ________ is a specialized group of consumers and employees whose identification and activities focus around the brand. A) community B) channel C) association D) personality E) cluster
A
62) What is positive customer-based brand equity?
A brand is said to have positive customer-based brand equity when consumers react more favorably to a product and the way it is marketed when the brand is identified, than when it is not identified.
125) Two advantages of ________ are that they can facilitate new-product acceptance and provide positive feedback to the parent brand and company. A) product licensing B) brand extensions C) brand architecture D) brand audits E) brand dilutions
B
40) Brand salience ________. A) is customers' emotional responses and reactions with respect to the brand B) is how often and how easily customers think of the brand under various purchase or consumption situations C) is how well the product or service meets customers' functional needs D) describes the extrinsic properties of the product or service, including the ways in which the brand attempts to meet customers' psychological or social needs E) describes the relationship customers have with the brand and the extent to which they feel they're "in sync" with it
B
1) The first step in the strategic brand management process is ________. A) measuring consumer brand loyalty B) identifying and establishing brand positioning C) planning and implementing brand marketing D) measuring and interpreting brand performance E) growing and sustaining brand value
B
10) ________ brand equity is the differential effect that brand knowledge has on consumer response to the marketing of that brand. A) Mission-driven B) Customer-based C) Product-driven D) Service-driven E) Function-based
B
33) Which of the following levels of the BrandDynamics Pyramid pertains to consumer's needs? A) advantage B) relevance C) bonding D) performance E) presence
B
67) Distinguish between brand equity and brand valuation.
Brand equity is the added value endowed to products and services. Brand valuation is the job of estimating the total financial value of the brand.
64) How does consumer knowledge play a role in the success of new products associated with existing brands?
Brand knowledge created by marketing investments dictates appropriate future directions for the brand. Consumers will decide, based on what they think and feel about the brand, where they believe the brand should go and grant permission to any marketing action or program. Many new products can fail because consumers find them inappropriate extensions for the brand.
6) What valuable functions can brands perform for a firm?
Brands perform a number of valuable functions for firms. First, they simplify product handling or tracing. Brands help to organize inventory and accounting records. A brand also offers the firm legal protection for unique features or aspects of the product. The brand name can be protected through registered trademarks; manufacturing processes can be protected through patents; and packaging can be protected through copyrights and proprietary designs. These intellectual property rights ensure that the firm can safely invest in the brand and reap the benefits of a valuable asset. A credible brand signals a certain level of quality so that satisfied buyers can easily choose the product again. Brand loyalty provides predictability and security of demand for the firm, and it creates barriers to entry that make it difficult for other firms to enter the market. Loyalty also can translate into customer willingness to pay a higher price.
115) When a firm uses an established brand to introduce a new product, it is called a brand ________. A) harmonization B) valuation C) extension D) positioning E) parity
C
122) A brand ________ is the set of all brands and brand lines a particular firm offers for sale to buyers in a particular category. A) architecture B) position C) portfolio D) extension E) image
C
16) Identify the four pillars of brand equity, according to BrandAsset® Valuator model. A) relevance, performance, bonding, and advantage B) presence, performance, advantage, and bonding C) energized differentiation, relevance, esteem, and knowledge D) brand salience, brand feelings, brand imagery, and brand performance E) energized differentiation, esteem, brand feelings, and brand salience
C
18) Christian Louboutin is a footwear designer who launched his line of high-end women's shoes in France in 1991. The brand caters to an elite clientele whose satisfaction with the brand has always been evident. Apart from being high-end, Louboutin footwear signifies power in elite social circles. Celebrities are often seen sporting "Loubs" at special occasions, such as movie premieres. This has resulted in people associating Louboutin footwear with class and power. In accordance with the BrandAsset® Valuator model, which of the following components of brand equity has Louboutin fulfilled in this scenario? A) knowledge B) energized differentiation C) esteem D) advantage E) presence
C
3) Branding is ________. A) all about creating unanimity between products B) the process of performing market research and selling products or services to customers C) endowing products and services with the power of a brand D) the process of comparing competing brands available in the market E) use of online interactive media to promote products and brands
C
32) If a consumer who is trying to decide between alternatives believes that a particular brand delivers acceptable product performance and can be shortlisted, she is in the ________ level of the BrandDynamics Pyramid. A) presence B) relevance C) performance D) advantage E) bonding
C
36) According to the BRANDZ model of brand strength, brand building involves people progressing through a sequential series of steps. Which of these steps would address or answer the question "Does this brand offer something better than the others?" A) performance B) presence C) advantage D) bonding E) relevance
C
38) According to the BRANDZ model of brand strength, brand building involves people progressing through a sequential series of steps. Which of these steps would address or answer the question "Does this brand offer me something?" A) advantage B) presence C) relevance D) bonding E) performance
C
46) With respect to the "six brand building blocks," brand ________ describes the relationship customers have with the brand and the extent to which they feel they're "in sync" with it. A) imagery B) judgment C) resonance D) salience E) performance
C
159) Identify and describe three things that affect customer lifetime value.
Customer lifetime value is affected by revenue and by the costs of customer acquisition, retention, and cross-selling. Acquisition depends on the number of prospects, the acquisition probability of a prospect, and acquisition spending per prospect. Retention is influenced by the retention rate and retention spending level. Add-on spending is a function of the efficiency of add-on selling, the number of add-on selling offers given to existing customers, and the response rate to new offers.
43) With respect to the "six brand building blocks," brand ________ focuses on customers' own personal opinions and evaluations. A) salience B) performance C) imagery D) judgment E) resonance
D
76) The traditional "marketing-mix" concept and the notion of the "four Ps" may not adequately describe modern marketing programs. ________ is about mixing and matching marketing activities to maximize their individual and collective effects. A) Personalized marketing B) Mass customization C) Globalized marketing D) Relationship marketing E) Integrated marketing
E
104) ________ are a means of understanding where, how much, and in what ways brand value is being created to facilitate day-to-day decision making. A) Internal marketing campaigns B) Brand portfolio audits C) Brand value chains D) Sales cycles E) Brand-tracking studies
E
121) A ________ is a set of all brand lines that a particular seller makes. A) brand platform B) brand image C) co-brand D) brand extension E) brand mix
E
130) When Honda expanded its brand into such areas as automobiles, snow blowers, and marine engines, it was pursuing a strategy called line extension.
FALSE
143) United Technologies is a good example of a house of brands strategy because it uses individual or separate family brand names including Otis elevators, Carrier heaters and air conditioners, Hamilton Sundstrand aerospace and industrial, and Sikorsky helicopters.
TRUE
87) A brand promise will not be delivered unless everyone in a company lives the brand.
TRUE
89) A brand community can be a constant source of inspiration and feedback for product improvements or innovations.
TRUE
91) Spending on product research, development, and design constitutes investment in the brand value development process.
TRUE
160) Compare and contrast brand equity and customer equity.
The brand equity and customer equity perspectives both emphasize the importance of customer loyalty and the notion that we create value by having as many customers as possible pay as high a price as possible. In practice, however, the two perspectives emphasize different things. The customer equity perspective focuses on bottom-line financial value. Its clear benefit is its quantifiable measures of financial performance. But it offers limited guidance for go-to-market strategies. It largely ignores some of the important advantages of creating a strong brand, such as the ability to attract higher-quality employees, elicit stronger support from channel and supply chain partners, and create growth opportunities through line and category extensions and licensing. The customer equity approach can overlook the "option value" of brands and their potential to affect future revenues and costs. It does not always fully account for competitive moves and countermoves or for social network effects, word of mouth, and customer-to-customer recommendations. Brand equity, on the other hand, tends to emphasize strategic issues in managing brands and creating and leveraging brand awareness and image with customers. It provides much practical guidance for specific marketing activities. With a focus on brands, however, managers don't always develop detailed customer analyses in terms of the brand equity they achieve or the resulting long-term profitability they create. Brand equity approaches could benefit from sharper segmentation schemes afforded by customer-level analyses and more consideration of how to develop personalized, customized marketing programs — whether for individuals or for organizations such as retailers. There are generally fewer financial considerations put into play with brand equity than with customer equity.
109) Identify and describe the four value stages of the brand value chain.
The brand value creation process begins when the firm invests in a marketing program targeting actual or potential customers. Next, customers' mindsets are assumed to change as a result of the marketing program. This change affects the way the brand performs in the marketplace through the collective impact of individual customers deciding how much to purchase and when, how much they'll pay, and so on. Finally, the investment community considers market performance and other factors such as replacement cost and purchase price in acquisitions to arrive at an assessment of shareholder value in general and the value of a brand in particular.
153) Tide laundry detergent maintains the same market share it had 50 years ago because of the sales contributions from its various line extensions. It can be said that Tide employs a preemptive cannibalization strategy in generating line extensions. What does this mean?
When there is a threat of losing consumers to a competing brand, companies sometimes opt for preemptive cannibalization. This causes consumers to switch between the same brand's products, preventing loss of customers. Even though Tide's various line extensions may cannibalize sales of its other products, if the extensions had not been introduced, then customers would have defected to another brand offering the same type of extension. In this way, Tide has maintained its market share through preemptive cannibalization.
101) A structured approach to assessing the sources and outcomes of brand equity and the manner in which marketing activities create the financial worth of the brand is called ________. A) the brand value chain B) the brand portfolio C) the brand life cycle D) brand partitioning E) brand positioning
A
103) Clarity, relevance, distinctiveness, and consistency are factors that influence the ________ multiplier of the brand value chain. A) program B) brand C) market D) customer E) profit
A
15) When a marketer expresses his or her vision of what a brand must be and do for consumers, he or she is expressing what is called a brand ________. A) promise B) personality C) identity D) position E) revitalization
A
152) What is a licensed product? Why have corporations seized on licensing?
A licensed product is one whose brand name has been licensed to other manufacturers that actually make the product. Corporations have seized on licensing to push their company names and images across a wide range of products — from bedding to shoes — making licensing a multibillion dollar business.
102) Competitive superiority and channel support are factors that influence the ________ multiplier of the brand value chain. A) program B) customer C) brand D) profit E) market
B
155) Which of the following is NOT a weakness of a customer equity perspective (relative to a brand equity perspective)? A) It offers limited guidance for go-to-market strategies. B) It has quantifiable measures of financial performance. C) It ignores the advantages of creating a strong brand. D) It overlooks the option value of brands. E) It does not fully account for social network effects or word-of-mouth.
B
112) According to Millward Brown, how is brand predisposition measured?
Millward Brown asserts that this brand predisposition is measured by three brand equity metrics: power, premium and potential. People are predisposed to choose the brand over others. This will drive brand volume, so power predicts volume share based entirely on perceptions, absent of activation factors. People are predisposed to pay more for the brand. This will allow the brand to charge more, so premium predicts the price index your brand can command. Potential indicates the likelihood of value share growth for the brand in the next 12 months, based on people's predisposition to stick to the brand or try it in the future.
139) Research indicates that high-quality brands stretch farther than average-quality brands, although both types of brands have boundaries.
TRUE
142) A successful extension cannot only contribute to the parent brand image but also enable a brand to be extended even farther.
TRUE
157) Customer lifetime value is affected by revenue and by the costs of customer acquisition, retention, and cross-selling.
TRUE
158) Both brand equity and customer equity emphasize the importance of customer loyalty and the notion that we create value by having as many customers as possible pay as high a price as possible.
TRUE
60) The creation of significant brand equity involves reaching the top or pinnacle of the brand pyramid. What are the six components of the brand resonance pyramid?
The six components of the brand resonance pyramid include: 1. brand salience — relates to how often and easily the brand is evoked under various purchase or consumption situations 2. brand performance — relates to how the product or service meets customers' functional needs 3. brand imagery — deals with the extrinsic properties of the product or service, including the ways in which the brand attempts to meet the customers' psychological or social needs 4. brand judgments — focus on consumers' own personal opinions and evaluations 5. brand feelings — customers' emotional responses and reactions with respect to the brand 6. brand resonance — refers to the nature of the relationship that customers have with the brand and the extent to which customers feel that they are "in sync" with the brand.
111) Describe the meaning and function of a brand audit.
To better understand the sources of brand equity and how they affect outcomes of interest, marketers often need to conduct brand audits. A brand audit is a consumer-focused exercise that involves a series of procedures to assess the health of the brand, uncover its sources of brand equity, and suggest ways to improve and leverage its equity. The brand audit can be used to set strategic direction for the brand. As the result of this strategic analysis, the marketer can develop a marketing program to maximize long-term brand equity. Marketers should conduct a brand audit whenever they consider important shifts in strategic direction.
110) Describe the function of brand-tracking studies.
To understand how the sources and outcomes of brand equity change, if at all, over time, marketers conduct brand tracking studies. These studies collect quantitative data from consumers over time to provide consistent, baseline information about how brands and marketing programs are performing. Tracking studies help us understand where, how much, and in what ways brand value is being created, to facilitate day-to-day decision making.
11) Adam wants to buy a washing machine and is looking for something that is not too expensive. When he goes to make the purchase, he finds there are two options that meet his requirements. One is a Maytag product, while the other is a newly imported South Korean brand. Adam is not very familiar with the latter and does not hesitate in choosing Maytag. This example implies that ________. A) the imported brand will not survive the competition from Maytag B) Maytag has a positive customer brand equity C) the South Korean company has a low advertising budget D) the imported brand is unreliable E) the Maytag washing machine has better features than the imported brand
B
24) According to the BrandAsset® Valuator model, which of the components of brand equity measures the breadth of a brand's appeal? A) differentiation B) relevance C) esteem D) knowledge E) value
B
27) According to the BrandAsset® Valuator model, strong new brands show ________. A) higher levels of esteem and knowledge than relevance, whereas both differentiation and energy are lower still B) higher levels of differentiation and energy than relevance, whereas both esteem and knowledge are lower still C) high knowledge — evidence of past performance — a lower level of esteem, and even lower relevance, energy, and differentiation D) high levels on energy, differentiation, relevance, knowledge, and esteem E) low levels on energy, differentiation, relevance, knowledge, and esteem
B
35) According to the BRANDZ model of brand strength, brand building involves people progressing through a sequential series of steps. Which of these steps would address the question "Do I know about this brand?" A) relevance B) presence C) performance D) advantage E) bonding
B
29) According to BrandAsset® Valuator model, declining brands show ________. A) higher levels of esteem and knowledge than relevance, whereas both differentiation and energy are lower still B) high relevance — appropriateness of brand's appeal — a lower level of energy and differentiation, and even lower knowledge C) high levels on energy, differentiation, relevance, knowledge, and esteem D) higher levels of differentiation and energy than relevance, whereas both esteem and knowledge are lower still E) high knowledge — evidence of past performance — a lower level of esteem, and even lower relevance, energy, and differentiation
E
77) Mark feels that Shell delivers on its promises to supply the best gasoline possible to the public. His experiences with Shell have always been good resulting in positive brand contact. Mark is most likely experiencing brand ________. A) alliance B) essence C) harmonization D) parity E) bonding
E
8) How does the American Marketing Association (AMA) define the term brand?
A brand, according to the AMA, is "a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors."
28) According to BrandAsset® Valuator model, leadership brands show ________. A) high levels of energy, differentiation, relevance, knowledge, and esteem B) higher levels of esteem and knowledge than relevance, whereas both differentiation and energy are lower still C) higher levels of differentiation and energy than relevance, whereas both esteem and knowledge are lower still D) low levels on energy, differentiation, relevance, knowledge, and esteem E) high knowledge — evidence of past performance — a lower level of esteem, and even lower relevance, energy, and differentiation
A
31) Aromas Inc. introduced a new line of shower gels. To analyze consumer reaction, the company interviewed people who bought them. When Sarah was asked why she had chosen the new shower gel, she said she bought it because a friend recommended it. Sarah is at which level of the BrandDynamics Pyramid? A) presence B) bonding C) relevance D) performance E) advantage
A
37) According to the BRANDZ model of brand strength, brand building involves people progressing through a sequential series of steps. Which of these steps would address or answer the question "Can this brand deliver?" A) performance B) bonding C) advantage D) relevance E) presence
A
70) The brand name of New Zealand vodka 42BELOW refers to both a latitude that runs through New Zealand and the percentage of its alcohol content. From a marketing management perspective, which of the brand equity drivers is most applicable in the given scenario? A) the associations indirectly transferred to the brand by linking it to a place or thing B) the product and all accompanying marketing activities and supporting marketing programs C) the initial choices for the brand elements or identities making up the brand D) the profitability associated with brand development E) the service and all accompanying marketing activities and programs
A
13) The challenge for marketers in building a strong brand is ________. A) ensuring that customers have the right type of experiences with their products and marketing programs to create the desired brand knowledge B) pricing the product at a point that maximizes sales volume C) minimizing the number of people to whom the product is targeted in order to provide consumers with a personalized experience D) minimizing the impact of customer brand equity E) avoiding the usage of an established brand to introduce a new product in the market
A
17) Christian Louboutin is a footwear designer who launched his line of high-end women's shoes in France in 1991. Since 1992, his designs have incorporated the shiny, red-lacquered soles that have become his signature. These red-lacquered soles and high stilettos of Louboutin distinguish him from other designer shoe brands. In accordance with the BrandAsset® Valuator model, which of the following components of brand equity has Louboutin fulfilled in this scenario? A) energized differentiation B) relevance C) esteem D) knowledge E) advantage
A
71) Brand ________ are devices that can be trademarked and serve to identify and differentiate the brand. A) elements B) value propositions C) perceptions D) images E) extensions
A
69) Red Bull enlisted college students as "Red Bull student brand managers" to distribute samples, research drinking trends, design on-campus product promotion activities, and write stories for student newspapers. From a marketing management perspective, which of the following brand equity drivers is most applicable in the given scenario? A) the profitability associated with brand development B) associations indirectly transferred to the brand by linking it to a person C) the product and all accompanying marketing activities and supporting marketing programs D) the initial choices for the brand elements or identities making up the brand E) associations indirectly transferred to the brand by linking it to a place
C
81) Names that become synonymous with product categories like Kleenex, Kitty Litter, Jell-O, and Xerox, need to ensure they retain their brand names remain ________ so they can retain their trademark rights and avoid becoming generic. A) meaningful B) likable C) protectable D) transferable E) adaptable
C
14) Which of the following is a marketing advantage of strong brands? A) no vulnerability to marketing crises B) more elastic consumer response to price increases C) guaranteed profits D) additional brand extension opportunities E) more inelastic consumer response to price decreases
D
2) The American Marketing Association defines a ________ as "a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors." A) copyright B) trademark C) slogan D) brand E) logo
D
20) According to the BrandAsset® Valuator model, which of the components of brand equity measures how aware and familiar consumers are with the brand? A) esteem B) energized differentiation C) relevance D) knowledge E) presence
D
41) With respect to the "six brand building blocks," brand ________ signifies how well the product or service meets customers' functional needs. A) judgment B) imagery C) salience D) performance E) resonance
D
47) With respect to the "six brand building blocks," brand ________ are customers' emotional responses and reactions with respect to the brand. A) imagery statements B) judgments C) performances D) feelings E) resonances
D
72) If a brand element can be used to introduce new products in the same or different categories, the brand element is said to be ________. A) memorable B) meaningful C) likeable D) transferable E) adaptable
D
99) A brand ________ can be defined as any information-bearing experience a customer or prospect has with the brand, the product category, or the market that relates to the marketer's product or service. A) value B) personality C) trait D) character E) contact
E
65) Brand equity has four components — energized differentiation, relevance, esteem, and knowledge. How are these components combined to produce brand strength and brand stature?
Energized differentiation and relevance combine to produce brand strength. Esteem and knowledge together create brand stature.
52) The quantity, rather than quality, of a marketer's investment in brand building is the critical factor in building brand equity.
FALSE
54) According to the BrandZ model, "Bonded" consumers at the lower levels of the pyramid build stronger relationships with and spend more on the brand than those at the top.
FALSE
93) An important part of reinforcing brands is providing uniform and unchanging marketing support.
FALSE
