Chapter 9: Creating Brand Equity
GENERAL CONCEPT QUESTIONS
Multiple Choice
1. At the heart of a successful brand is ________, backed by creatively designed and
executed marketing.
a. price
b. promotion
c. a great product or service
d. a great slogan
e. a brand concept
Answer: c
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Level of difficulty: Easy
2. The strategic branch management process involves four main steps. Which of the
following would NOT be among those steps?
a. Measuring consumer brand knowledge.
b. Identifying and establishing brand positioning.
c. Planning and implementing brand marketing.
d. Measuring and interpreting brand performance.
e. Growing and sustaining brand value.
Answer: a
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Level of difficulty: Hard
3. 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. holistic product concept
b. product concept
c. service concept
d. brand
e. brand image
Answer: d
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Level of difficulty: Medium
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Chapter 9: Creating Brand Equity
4. The earliest signs of branding in Europe were medieval ________ requirement that
craftspeople put trademarks on their products to protect themselves and consumers
against inferior quality.
a. kings’
b. churches’
c. consumers’
d. governments’
e. guilds’
Answer: e
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Level of difficulty: Medium
5. Consumers learn about brands through ________ and product marketing programs.
a. the mass media
b. past experiences with the product
c. the sales force
d. shopping bots
e. independent information sources
Answer: b
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Level of difficulty: Medium
6. The world’s strongest brands share common attributes. Which of the following would
NOT be among those common attributes?
a. The brand that spends the most is the most respected and valued.
b. The company monitors sources of brand equity.
c. The pricing strategy is based on consumer perceptions of value.
d. The brand stays relevant.
e. The brand excels at delivering the benefits consumers truly desire.
Answer: a
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Level of difficulty: Hard
7. ________ is endowing products and services with the power of a brand.
a. Brand image
b. The branding concept
c. Branding
d. Brand positioning
e. Brand partitioning
Answer: c
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Level of difficulty: Easy
8. Brand ________ is the added value endowed to products and services.
a. loyalty
b. equity
c. preference
d. satisfaction
e. benefits
Answer: b
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Level of difficulty: Medium
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9. The premise of ________ models is that the power of a brand lies in what customers
have seen, read, learned, thought, and felt about the brand over time.
a. product-based brand equity
b. service-based brand equity
c. functional-based brand equity
d. mission-driven brand equity
e. consumer-based brand equity
Answer: e
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Level of difficulty: Hard
10. ________ can be defined as the differential effect that brand knowledge has on
consumer response to the marketing of that brand.
a. Mission-driven brand equity
b. Consumer-based brand equity
c. Product-driven brand equity
d. Service-driven brand equity
e. Function-based brand equity
Answer: b
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Level of difficulty: Medium
11. When a consumer expresses thoughts, feelings, images, experiences, beliefs, and so
on that become associated with the brand, the consumer is expressing brand
________.
a. knowledge
b. loyalty
c. behavior
d. preference
e. equity
Answer: a
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Level of difficulty: Easy
12. ________ is what drives the differences that manifest themselves in brand equity.
a. Brand image
b. Consumer income
c. Consumer purchasing power
d. Consumer knowledge
e. Brand perception
Answer: d
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Level of difficulty: Medium
13. Strong brands possess all of the following marketing advantages EXCEPT ________.
a. greater loyalty
b. larger margins
c. guaranteed profits
d. improved perceptions of product performance
e. more elastic consumer response to price decreases
Answer: c
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14. When a marketer expresses his or her vision of what the brand must be and do for
consumers, they are expressing what is called ________.
a. a brand promise
b. a brand mission
c. brand equity
d. a brand position
e. a brand concept
Answer: a
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Level of difficulty: Hard
15. There are four key components—or pillars—of brand equity. Which of those
components or pillars measures the breadth of a brand’s appeal?
a. Differentiation
b. Relevance
c. Esteem
d. Knowledge
e. Value
Answer: b
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Level of difficulty: Hard
16. Two pillars that point to the brand’s future value, rather than just reflecting its past,
are differentiation and relevance. Differentiation and relevance combine to determine
what is called brand ________.
a. position
b. image
c. depth
d. knowledge
e. strength
Answer: e
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Level of difficulty: Medium
17. David Aaker views brand equity as a set of five categories of brand assets and
liabilities linked to a brand that add or subtract from the value provided by a product
or service to a firm and/or that firm’s customers. All of the following would be
among Aaker’s five categories EXCEPT ________.
a. brand loyalty
b. brand awareness
c. perceived quality
d. brand price
e. brand associations
Answer: d
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18. According to Aaker, a particularly important concept for building brand equity is
________—the unique set of brand associations that represent what the brand stands
for and promises to consumers.
a. brand knowledge
b. brand preference
c. brand identity
d. brand vision
e. brandable differences
Answer: c
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Level of difficulty: Medium
19. General Motors states that its ________ is a “world class car with employees who
treat customers with respect and as friends.”
a. core identity
b. perceived identity
c. extended identity
d. defensible identity
e. competitive identity
Answer: a
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Level of difficulty: Medium
20. According to the BRANDZ model of brand strength, brand building involves a
sequential series of steps. Which of these steps would address or answer the question
“Do I know about it?”
a. Relevance
b. Presence
c. Performance
d. Advantage
e. Bonding
Answer: b
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Level of difficulty: Medium
21. The MasterCard “priceless” ad campaign is a good example of brand duality. Two
advantages of the brand are demonstrated in this campaign. What are those
advantages?
a. Positive and negative advantages.
b. Local and global advantages.
c. Rational and emotional advantages.
d. Segmented and differentiated advantages.
e. Price and promotional advantages.
Answer: c
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Level of difficulty: Hard
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22. All of the following are considered to be among the “six brand building blocks”
EXCEPT ________.
a. brand salience
b. brand performance
c. brand imagery
d. brand feelings
e. brand pride
Answer: e
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Level of difficulty: Medium
23. With respect to the “six brand building blocks,” ________ focus on customers’ own
personal opinions and evaluations.
a. brand salience
b. brand performance
c. brand imagery
d. brand judgments
e. brand resonance
Answer: d
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Level of difficulty: Medium
24. With respect to the brand resonance pyramid, at which of the following “building
block levels” would we expect the consumer to have developed an intense, active
loyalty?
a. Salience
b. Imagery
c. Feelings
d. Judgments
e. Resonance
Answer: e
age: 281
Level of difficulty: Hard
25. 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 supporting marketing
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.
Answer: c
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26. ________ are those trademarkable devices that serve to identify and differentiate the
brand.
a. Brand elements
b. Brand value
c. Brand perception
d. Brand image
e. Brand tracks
Answer: a
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Level of difficulty: Medium
27. Six brand elements assist in brand building. Which of the following would NOT be
among those preferred brand elements?
a. Adaptable
b. Protectable
c. Memorable
d. Likeability
e. Subliminal nature
Answer: e
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Level of difficulty: Medium
28. 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
Answer: d
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Level of difficulty: Medium
29. Before selecting a brand name, marketers must be assured that the brand name will be
well received and understood by the consumers. In order to do this several tests may
need to be performed. A(n) ________ asks such questions as “How easily is the name
pronounced?”
a. association test
b. learning test
c. memory test
d. preference test
e. design test
Answer: b
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Level of difficulty: Medium
30. Brand names are not only important brand element. Often, ________, the more
important it is that brand elements capture the brand’s intangible characteristics.
a. the less concrete brand benefits are
b. the more concrete brand benefits are
c. the more varied brand perceptions are
d. the less varied brand perceptions are
e. the more sophisticated brand benefits are
Answer: a
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Level of difficulty: Hard
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Chapter 9: Creating Brand Equity
31. With respect to powerful brand elements, a ________ is an extremely efficient means
to build brand equity. The element can function as useful “hooks” or “handles” to
help consumers grasp what the brand is and what makes it special.
a. spokesperson
b. product shape
c. slogan
d. patent
e. promotional descriptor
Answer: c
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Level of difficulty: Medium
32. Brand elements and secondary associations can make important contributions to
building brand equity; however, the primary input comes from ________.
a. the product or service and supporting marketing activities
b. marketing research
c. the consumer
d. the distributors
e. the organizational mission statement
Answer: a
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Level of difficulty: Medium
33. A ________ 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. brand value
b. brand element
c. brand trait
d. brand character
e. brand contact
Answer: e
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Level of difficulty: Medium
34. Chupa Chups has the distinction of being the world’s largest maker of ________ and
has begun to diversify its brand beyond its original market (children). Today, Chupa
Chups is targeting teens and youth through “nonendorser endorsers” such as Jerry
Seinfeld.
a. veggie chips
b. apple juice
c. roller skates
d. lollipops
e. granola
Answer: d
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Level of difficulty: Hard
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35. Considering holistic marketing activities, the rapid expansion of ________ has
created opportunities to personalize marketing.
a. target marketing
b. globalization
c. the Internet
d. standardization
e. CD technology
Answer: c
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Level of difficulty: Hard
36. ________ is about making sure that the brand and its marketing are as relevant as
possible to as many customers as possible—a challenge, given that no two customers
are identical.
a. Personalizing marketing
b. Segmenting marketing
c. Brand imagery
d. Emotionalizing brands
e. Rationalizing brands
Answer: a
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Level of difficulty: Medium
37. The traditional “marketing-mix” concept and the notion of the “4 Ps” may not
adequately describe modern marketing programs. ________ is about mixing and
matching marketing activities to maximize their individual and collective effects.
a. Personalizing marketing
b. Individualizing marketing
c. Globalizing marketing
d. Institutionalizing marketing
e. Integrating marketing
Answer: e
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Level of difficulty: Medium
38. Godin identifies five specific steps to enhance effective permission marketing. Which
of the following would NOT be among those steps?
a. Offer the prospect an incentive to volunteer.
b. Offer the interested prospect a curriculum over time that teaches the consumer
about the product or service.
c. Reinforce the incentive to guarantee that the prospect maintains the permission.
d. Always offer a monetary incentive to demonstrate sincerity of the offer.
e. Over time, leverage the permission to change consumer behavior toward profits.
Answer: d
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Level of difficulty: Hard
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Chapter 9: Creating Brand Equity
39. ________ is the consumers’ ability to identify the brand under different conditions, as
reflected by their brand recognition or recall performance.
a. Brand awareness
b. Brand image
c. Brand alternation
d. Brand perception
e. Brand reflection
Answer: a
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Level of difficulty: Medium
40. A marketing manager has decided to study the perceptions and beliefs held by
consumers, as reflected in the associations held in consumer memory. Which of the
following terms is most closely associated with the marketing manager’s objective of
study?
a. Brand awareness
b. Brand image
c. Brand element
d. Brand concept
e. Brand trait
Answer: b
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Level of difficulty: Medium
41. For a brand to succeed, marketers must “walk the walk” and ensure that employees
and marketing partners do the same. Marketers often must use ________ to motivate
those groups to support the brand.
a. global branding
b. retro-branding
c. internal branding
d. external branding
e. dual branding
Answer: c
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Level of difficulty: Medium
42. Mark Thomas has observed that Shell delivers on its promises to supply the best
gasoline possible to the driving public. Shell promotions, employees, and distributors
send a common and consistent message about delivering on Shell promises to Mr.
Thomas. A good term that describes what occurs when customers experience the
company as delivering on its brand promise is the term ________.
a. brand image
b. brand enhancement
c. brand belief
d. brand attitude
e. brand bonding
Answer: e
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43. The main secondary sources of brand knowledge come from all of the following
EXCEPT ________.
a. other brands
b. people
c. things
d. local, state, and federal governments
e. places
Answer: d
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Level of difficulty: Easy
44. Brand equity can be measured in two ways. Which of the following would be a good
representation of one of those ways?
a. Statistical analysis of demographics.
b. Secondary evaluation of governmental statistics.
c. Directly assessing the actual impact of brand knowledge on consumer response to
different aspects of marketing.
d. Evaluating published statistics of competitors.
e. Hiring independent evaluators.
Answer: c
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Level of difficulty: Medium
45. A structured approach to assessing the sources and outcomes of brand equity and the
manner in which marketing activities create brand value is called ________.
a. the brand value chain
b. the brand portfolio
c. the brand life cycle
d. brand partitioning
e. brand positioning
Answer: a
Page: 288
Level of difficulty: Medium
46. A brand manager is concerned that his organization’s brand image and physical sales
are slipping in the marketplace. The manager has decided to query consumers about
the health of the brand and try to discover ways to leverage the brand’s equity. Which
of the following terms will most likely provide the structure and process for the
manager’s investigation?
a. A brand demographic matrix analysis.
b. A secondary search of good brand characteristics.
c. A brand audit.
d. An organizational audit.
e. A brand positioning study.
Answer: c
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47. Within a brand audit, the ________ has as its purpose to provide a current,
comprehensive profile of how all the products and services sold by a company are
marketed and branded.
a. cost curve calculation
b. product balance sheet
c. strategic plan
d. brand inventory
e. product assessment
Answer: d
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Level of difficulty: Medium
48. Many firms use ________ to supplement traditional focus groups. They study
consumers in their everyday habitats at home, at work, at play, or shopping.
a. ethnography
b. demography
c. geodemography
d. psychographics
e. product profiles
Answer: a
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Level of difficulty: Hard
49. Irene and Dave Washburn are part of a long-term ________. The Washburn’s supply
a national research firm with information about their brand habits, preferences,
dislikes, and beliefs on a monthly basis for a period of two years.
a. image study
b. demographic study
c. psychological profile study
d. promotion management study
e. tracking study
Answer: e
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Level of difficulty: Medium
50. ________ has the job of estimating the total financial value of the brand.
a. Brand tracking
b. Brand auditing
c. Brand equity
d. Brand valuation
e. Brand partitioning
Answer: d
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Level of difficulty: Medium
51. According to 2004 Brand Value estimates, ________ was ranked number-one in the
world with a brand value of $67.39 billion.
a. Microsoft
b. IBM
c. Coca-Cola
d. GE
e. McDonald’s
Answer: c
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52. A company’s major enduring asset is ________.
a. its leadership
b. its brand
c. its culture
d. its shareholders
e. its workers
Answer: b
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Level of difficulty: Easy
53. According to Interbrand’s Brand Strength formula, the most important factor in the
equation is ________ with a 25 percent weight.
a. stability
b. market
c. geographic spread
d. trend
e. leadership
Answer: e
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Level of difficulty: Hard
54. According to Scott Bedbury’s book, A New Brand World, all of the following are
considered to be important principles for twenty-first century branding EXCEPT
________.
a. consumers will tell you what your brand image should be
b. relying on brand awareness has become marketing fool’s gold
c. you have to know it before you can grow it
d. great brands establish enduring customer relationships
e. all brands need good parents
Answer: a
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Level of difficulty: Hard
55. When a firm uses an established brand to introduce a new product, it is called a(n)
________.
a. sub-brand
b. brand value
c. brand extension
d. brand mix
e. brand posture
Answer: c
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Level of difficulty: Medium
56. All of the following would be examples of companies that use family branding as one
of their branding strategies EXCEPT ________.
a. Campbell Soup
b. Sears
c. Heinz
d. General Electric
e. Hunt’s
Answer: b
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Chapter 9: Creating Brand Equity
57. According to Ries and Trout, Cadbury suffered from the ________ when the
company allowed its brand to become diluted by putting their name on such variants
as mashed potatoes, powdered milk, soups, beverages, as well as chocolates and
candies.
a. “greed is good” trap
b. “pyramid principle”
c. “branding fallout” concept
d. “image syndrome”
e. “line-extension” trap
Answer: e
Page: 299
Level of difficulty: Hard
58. A ________ is the set of all brands and brand lines a particular firm offers for sale to
buyers in a particular category.
a. brand partition
b. brand position
c. brand portfolio
d. brand concept
e. brand image
Answer: c
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Level of difficulty: Medium
59. ________ 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. Blitzkrieg
e. Individual
Answer: a
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60. The role of ________ in the brand portfolio often may be to attract customers to the
brand franchise. Trading up will often occur with this type of brand.
a. the cash cow
b. flanker brand
c. fighting brand
d. high-end prestige brand
e. low-end entry-level brand
Answer: e
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True/False
61. At the heart of a successful brand are the successful people that run the organization.
Answer: False
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62. Google’s successful brand name was derived from the word googol—the number
represented by a 1 followed by 100 zeroes.
Answer: True
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63. The American Marketing Association defines a brand 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.”
Answer: True
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Level of difficulty: Easy
64. One of the attributes shared by the world’s strongest brands is that the brand becomes
invulnerable to attack from competitors due to the support of the marketplace.
Answer: False
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Level of difficulty: Hard
65. The added value endowed to products and services is called brand equity.
Answer: True
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Level of difficulty: Medium
66. Brand knowledge is indicated when the consumer refuses to purchase competitive
brands.
Answer: False
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Level of difficulty: Medium
67. 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.
Answer: True
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Level of difficulty: Medium
68. The marketer’s vision of what the brand must be and do for consumers is called a
brand promise.
Answer: True
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Level of difficulty: Medium
69. There are four key components—or pillars—of brand equity; one of these
components is called knowledge.
Answer: True
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Level of difficulty: Medium
70. An illustration of the extended brand identity of GM’s Saturn brand is a “world-class
car with employees who treat customers with respect and as friends.”
Answer: False
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Level of difficulty: Hard
71. Under the BRANDZ model of brand strength, the brand objective of bonding is
translated to mean “nothing else beats it.”
Answer: True
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Level of difficulty: Easy
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Chapter 9: Creating Brand Equity
72. Brand resonance is associated with how a brand name sounds when said by
spokespersons or consumers.
Answer: False
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Level of difficulty: Hard
73. Brand salience relates to how often and easily the brand is evoked under various
purchase or consumption situations.
Answer: True
Page: 280
Level of difficulty: Medium
74. Brand imagery is the consumers’ emotional responses and reactions with respect to
the brand.
Answer: False
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Level of difficulty: Medium
75. In the brand resonance pyramid, the lowest level (e.g., identity—Who are you?) is
associated with what is called salience.
Answer: True
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76. A few good illustrations of power brand elements are Nike’s “swoosh” logo, the
empowering “Just Do It” slogan, and the mythological “Nike” name based on the
winged goddess of victory.
Answer: True
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Level of difficulty: Medium
77. One of the selection criteria for creating a successful brand element is that it should
be projectable.
Answer: True
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78. If a brand element has the characteristic of being memorable, it is said to mean that
the brand is credible and suggestive of its corresponding category.
Answer: False
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Level of difficulty: Hard
79. One of the ways for testing a brand element is to ask consumers how well they
remember the brand name; this is called a learning test.
Answer: False
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Level of difficulty: Medium
80. A powerful—but sometimes overlooked—brand element is slogans.
Answer: True
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Level of difficulty: Easy
81. A classic case of a company using a slogan to build brand equity is that of Avis’s 41year-old “We Try Harder” ad campaign.
Answer: True
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Level of difficulty: Easy
82. A brand contract is defined as any information-bearing experience a customer or
prospect has with a brand.
Answer: True
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Level of difficulty: Medium
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83. Personalizing marketing is based on the fact that all customers are identical in several
ways.
Answer: False
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Level of difficulty: Medium
84. Gillette sent 1,000 young males a new, innovative razor product. In return, the
company asked the young males to supply their e-mail addresses so future contacts
could be initiated. This would be an example of what is called permission marketing.
Answer: True
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Level of difficulty: Medium
85. Brand awareness can be perceived as being the consumers’ ability to identify the
brand under different conditions, as reflected by their brand recognition or recall
performance.
Answer: True
Page: 286
Level of difficulty: Medium
86. Internal branding is the perceptions and beliefs held by consumers, as reflected in the
associations held in consumer memory.
Answer: False
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Level of difficulty: Hard
87. Marketers must now “walk the walk” to deliver the brand promise. Often internal
branding is necessary to make sure that all employees assist in meeting the brand
promise.
Answer: True
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Level of difficulty: Medium
88. The brand promise will not be delivered unless everyone in the company lives the
brand.
Answer: True
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Level of difficulty: Easy
89. The indirect approach to assessing brand equity assesses the actual impact of brand
knowledge on consumer response to different aspects of marketing.
Answer: False
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Level of difficulty: Medium
90. A brand value chain often does not exist because of an organization’s commitment to
its service value chain.
Answer: False
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Level of difficulty: Medium
91. The brand audit can be used to set strategic direction for the brand.
Answer: True
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Level of difficulty: Easy
92. The purpose of brand strength (an assessment tool) is to provide a current,
comprehensive profile of how all the products and services sold by a company are
marketed and branded.
Answer: False
Page: 289
Level of difficulty: Hard
93. In order to explore more detailed information about brands, many firms are now using
ethnography to supplement traditional focus groups.
Answer: True
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Level of difficulty: Medium
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Chapter 9: Creating Brand Equity
94. Tracking studies collect information from consumers on a routine basis over time.
Answer: True
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Level of difficulty: Easy
95. In essence, brand equity is basically the same concept as brand valuation.
Answer: False
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Level of difficulty: Medium
96. At present, the most valuable brand in the world is Microsoft.
Answer: False
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97. A company’s most enduring asset is its intellectual capital generated by the top
officers of the organization.
Answer: False
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Level of difficulty: Medium
98. With respect to brand revitalization, the primary strategy for recovery is to hire a
public relations firm to think of a new image for the firm and its products.
Answer: False
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Level of difficulty: Hard
99. When Honda expanded its brand into such areas as automobiles, motorcycles,
snowblowers, lawnmowers, marine engines, and snowmobiles, it was pursuing a
strategy called category extension of its brand.
Answer: True
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Level of difficulty: Medium
100. Brand dilution occurs when consumers no longer associate a brand with a specific
product or highly similar products and start thinking less of the brand.
Answer: True
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Level of difficulty: Medium
Essay
101.
The world’s strongest brands share a list of common attributes. List and briefly
characterize five of those attributes.
Suggested Answer: According to information presented in the text, the world’s
strongest brands possess ten common characteristics. Those characteristics appear
as: (1) the brand excels at delivering the benefits consumers truly desire; (2) the
brand stays relevant; (3) the pricing strategy is based on consumer perceptions of
value; (4) the brand is properly positioned; (5) the brand is consistent; (6) the
brand portfolio and hierarchy makes sense; (7) the brand makes use of and
coordinates a full repertoire of marketing activities to build equity; (8) the brand’s
managers understand what the brand means to consumers; (9) the brand is given
proper, sustained support; and, (10) the company monitors sources of brand
equity. The students may choose any five of the above ten for their discussion.
See chapter material for addition discussion material.
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102.
Explain the concept of brand equity.
Suggested Answer: 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. Brand equity is an important intangible asset that
has psychological and financial value to the firm.
Page: 276
Level of difficulty: Medium
103.
Advertising agency Young and Rubicam (Y&R) developed a model of brand
equity called Brand Asset Valuator (BAV). What is the intent of the BAV model?
List and briefly characterize the four key components (pillars) of brand equity.
Suggested Answer: The BAV model is based on research of almost 200,000
consumers in 40 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)
differentiation—measures the degree to which a brand is seen as different from
others; (2) relevance—measures the breadth of a brand’s appeal; (3) esteem—
measures how well the brand is regarded and respected; and (4) knowledge—
measures how familiar and intimate consumers are with the brand. For additional
information on the BAV model, see chapter section.
Pages: 278–279
Level of difficulty: Medium
104.
The creation of significant brand equity involves reaching the top or pinnacle of
the brand pyramid. List and briefly characterize the six components of the brand
resonance pyramid.
Suggested Answer: The six components of the brand resonance pyramid include
brand: (1) salience—relates to how often and easily the brand is evoked under
various purchase or consumption situations; (2) performance—relates to how the
product or service meets customers’ functional needs; (3) 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)
judgments—focus on consumers’ own personal opinions and evaluations; (5)
feelings—customers’ emotional responses and reactions with respect to the brand;
and, (6) 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. For additional information on the brand resonance pyramid, see chapter
material.
Pages: 280–281
Level of difficulty: Hard
105.
There are six criteria used in creating brand elements. The first three can be
characterized as “brand building” in terms of how brand equity can be built
through the judicious choice of a brand element. The latter three are more
“defensive” and are concerned with how the brand equity contained in the brand
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element can be leveraged and preserved in the face of different opportunities and
constraints. List and briefly characterize the six criteria.
Suggested Answer: The six elements are: (1) memorable, (2) meaningful, (3)
likeability, (4) transferable, (5) adaptable, and (6) protectible. For
characterizations, see chapter materials.
Page: 282
Level of difficulty: Medium
106.
Describe the similarities and differences between the concepts of brand awareness
and brand image.
Suggested Answer: Brand awareness is consumers’ ability to identify the brand
under different conditions, as reflected by their brand recognition or recall
performance. Brand image is the perceptions and beliefs held by consumers, as
reflected in the associations held in consumer memory. Integration is especially
critical with marketing communications. From the perspective of brand building,
all communication options should be evaluated in terms of ability to affect brand
equity. Each communication option can be judged in terms of the effectiveness
and efficiency with which it affects brand awareness and with which it creates,
maintains, or strengthens brand image.
Page: 286
Level of difficulty: Medium
107.
Describe the meaning and function of a brand audit.
Suggested Answer: To better understand their brands, 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.
Page: 289
Level of difficulty: Medium
108.
According to top brand valuation firm Interbrand, brand valuation is based on an
assessment of what the value is today of the earnings or cash flow the brand can
be expected to generate in the future. The Interbrand Brand Strength Formula uses
seven components to make this assessment. What are those seven components and
their associated weights in the formula?
Suggested answer: The Interbrand Brand Strength Formula includes: (1)
leadership (25 percent), (2) stability (15 percent), (3) market (10 percent), (4)
geographic spread (25 percent), (5) trend (10 percent), (6) support (10 percent),
and (7) protection (5 percent). For additional information on the Interbrand
formula, see chapter materials.
Page: 292
Level of difficulty: Hard
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109.
The decision as to how to brand new products is especially critical. When a firm
introduces a new product, it has three main choices. What are those choices?
Suggested Answer: The firm can: (1) develop new brand elements for the new
product, (2) apply some of its existing brand elements, or (3) use a combination of
new and existing brand elements.
Page: 296
Level of difficulty: Medium
110.
There are a number of specific roles brands can play as part of a brand portfolio.
List and briefly describe the four roles described in the text.
Suggested Answer: The four roles are: (1) flankers—or fighting brands. These
are positioned with respect to competitors’ brands so that more important (and
more profitable) flagship brands can retain their desired positioning; (2) cash
cows—some brands may be kept around despite dwindling sales because they still
manage to hold on to a sufficient number of customers and maintain their
profitability with virtually no marketing support. These “cash cow” brands can be
effectively “milked” by capitalizing on their reservoir of existing brand equity; (3)
low-end entry-level—the role of the relatively low-priced in the brand portfolio
often may be to attract customers to the brand franchise. Retailers like to feature
these “traffic builders” because they are able to “trade up” customers to a higherpriced brand; and, (4) high-end prestige—the role of a high-priced brand in the
brand family often is to add prestige and credibility to the entire portfolio. For
additional information on the four roles, see chapter materials.
Pages: 302–303
Level of difficulty: Hard
APPLICATION QUESTIONS
Multiple Choice
Based on a public poll conducted in 2002, ________ was named “Brand of the
Year” by Interbrand branding consultants; in fact, the brand name has become a
verb that is used to describe an online search.
a. Yahoo!
b. Microsoft
c. Linux
d. Google
e. America Online
Answer: d
Page: 273
Level of difficulty: Easy
111.
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Chapter 9: Creating Brand Equity
112.
Marketers of successful twenty-first-century brands must excel at ________—the
design and implementation of marketing activities and programs to build,
measure, and manage brands to maximize their value.
a. promotional planning
b. brand personification
c. strategic brand management
d. brand awareness
e. competitive differential advantage
Answer: c
Page: 274
Level of difficulty: Medium
113.
All of the following are valuable functions performed by brands for firms
EXCEPT ________.
a. they simplify product handling or tracing
b. helps to organize inventory and accounting records
c. offers the firm legal protection through registered trademarks
d. intellectual property rights can be protected
e. a branded product is almost always guaranteed to be profitable
Answer: e
Page: 274
Level of difficulty: Medium
114.
If a brand has the attributes of staying relevant, is properly positioned, is
consistent, and makes use of and continues a full repertoire of marketing activities
to build equity, the brand is most likely to be a ________.
a. successful brand
b. domestic brand
c. regional brand
d. global brand
e. service brand
Answer: a
Page: 275
Level of difficulty: Easy
115.
Coca-Cola, Calvin Klein, Gucci, Tommy Hilfiger, Marlboro and others have
become leaders in their product categories by understanding ________ and
desires and creating relevant and appealing images around their products.
a. consumer perceptions
b. consumer motivations
c. consumer behaviors
d. consumer demographics
e. consumer market segments
Answer: b
Page: 276
Level of difficulty: Hard
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Part 4: Building Strong Brands
116.
Brands must create strong, favorable, and unique brand associations with
customers, as has been the case with Volvo (safety), Hallmark (________), and
Harley-Davidson (adventure).
a. caring
b. love
c. happiness
d. giving
e. humorous
Answer: a
Page: 277
Level of difficulty: Medium
117.
Apple achieves incredible brand loyalty largely by delivering on its mission as
defined by CEO Steve Jobs. That mission is best described as: ________.
a. “To dominate through technology”
b. “To create great things that change people’s lives”
c. “To think fast; introduce new products faster”
d. “To appeal to independent thinkers”
e. “To make the Mac world a reality”
Answer: b
Page: 277
Level of difficulty: Medium
118.
A marketing manager stresses to a newly hired brand manager the importance of
having a strong brand. All of the following would be advantages that the
marketing manager might stress to his subordinate EXCEPT ________.
a. improved perceptions of product performance
b. greater loyalty
c. less vulnerability to marketing crises
d. lower margins
e. possible licensing opportunities
Answer: d
Page: 277
Level of difficulty: Medium
119.
Virgin, the brainchild of England’s flamboyant Richard Branson, vividly
illustrates the power enjoyed and responsibility assumed by a strong brand. Which
of the following most accurately describes Branson’s brand strategy?
a. Compete by offering severe discounts to meet competitors’ normal pricing
strategies.
b. Use the credibility of the brand to challenge the dominant players in a range of
industries where the perception is that consumers are not getting value for
money.
c. Use promotion to inspire brand loyalty and mass consumption.
d. Compete by using guerrilla-marketing tactics.
e. To copy, copy, copy whenever possible to save funds for promotional warfare.
Answer: b
Page: 278
Level of difficulty: Hard
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Chapter 9: Creating Brand Equity
If a manager is looking for a “report card” on past performance of a brand, he or
she should turn to an examination of the brand ________.
a. strength
b. compatibility
c. stature
d. image
e. dominance
Answer: c
Page: 279
Level of difficulty: Medium
120.
121.
According to Aaker, brand identity consists of twelve dimensions organized
around four perspectives. Which of the four perspectives would apply to the
dimensions of brand personality and brand-customer relationships?
a. Brand-as-product
b. Brand-as-organization
c. Brand-as-person
d. Brand-as-symbol
e. Brand-as-competitor
Answer: c
Page: 279
Level of difficulty: Hard
122.
Any time a consumer thinks of a dependable car battery that might be needed in
an emergency situation such as a snow storm, the consumer thinks first of Die
Hard batteries. This would be an example of what is called brand ________.
a. salience
b. imagery
c. judgments
d. feelings
e. scope
Answer: a
Page: 280
Level of difficulty: Medium
The famous “Plop, plop, fizz, fizz! Oh, what a relief it is!” campaign is a good
example of what is called a brand ________.
a. element
b. tagline
c. visual
d. personification
e. perception
Answer: a
Page: 281
Level of difficulty: Medium
123.
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Part 4: Building Strong Brands
124.
One of the advantages enjoyed by Apple Computers is how aesthetically
appealing its products are perceived to be. Which of the following brand element
choice criteria matches to Apple’s aesthetic appeal?
a. memorable
b. meaningful
c. likeability
d. protectible
e. adaptable
Answer: c
Page: 282
Level of difficulty: Medium
125.
The idea for the famous Avis slogan “We Try Harder” came from an unusual
source. Which of the following would be most closely associated with that
source?
a. From an Avis manager during a meeting with ad agency account executives.
b. From a customer during a sponsored contest.
c. From a high school student during a career day.
d. From factory worker during a scheduled management/union meeting.
e. From a member of the National Transportation and Safety Board.
Answer: a
Page: 283
Level of difficulty: Hard
126.
According to Seth Godin, marketers can no longer use ________. Instead,
marketers should turn to permission marketing as a way to ensure long-term
customer relationships and loyalty.
a. task-oriented marketing
b. interruption marketing
c. hard core selling
d. advocacy marketing
e. one-to-one marketing
Answer: b
Page: 285
Level of difficulty: Medium
127.
If the Olive Garden sends employees to special classes to teach them the value of
the brand and how pasta is much more than just pasta, Olive Garden is using
________ to accomplish this task.
a. interruption marketing
b. loyalty marketing
c. cohort marketing
d. macrobranding
e. internal branding
Answer: e
Page: 286
Level of difficulty: Medium
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Chapter 9: Creating Brand Equity
128.
If an organization has as one of its objectives to collect information from
consumers on a routine basis over time, the organization will most likely use a
technique called ________ to accomplish the desired objective.
a. tracking studies
b. nonmetric-multidimensional scaling
c. Likert scaling
d. brand visualization
e. internal branding
Answer: a
Page: 290
Level of difficulty: Easy
129.
According to Interbrand, brand earnings are calculated by subtracting a number of
items from brand sales. All of the following would be among those items
EXCEPT ________.
a. costs of brand sales
b. marketing costs
c. variable and fixed overheads
d. all employee costs and benefits
e. remuneration of capital charge
Answer: d
Page: 292
Level of difficulty: Medium
130.
Four general strategies can be used in branding. Which of the following strategies
is the one used by Kellogg’s when it follows a sub-branding policy with
Kellogg’s Rice Krispies, Kellogg’s Raisin Bran, and Kellogg’s Corn Flakes?
a. Individual names.
b. Blanket family names.
c. Separate family names for all products.
d. Global names for all products.
e. Corporate name combined with individual product names.
Answer: e
Page: 297
Level of difficulty: Medium
Short Answer
131.
Assume you are a marketing manager that wishes pursue a process of strategic
brand management. List the four main steps that you would most likely go
through to accomplish this task.
Suggested Answer: The steps would be: (1) identifying and establishing brand
positioning; (2) planning and implementing brand marketing; (3) measuring and
interpreting brand performance; and, (4) growing and sustaining brand value.
Page: 274
Level of difficulty: Hard
132.
How does the American Marketing Association define the term brand?
Suggested Answer: 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
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services of one seller or group of sellers and to differentiate them from those of
competitors.”
Page: 274
Level of difficulty: Easy
133.
Assume that you are marketing manager attempting to explain the concept of
brand equity to a new employee in your department. What would be your
explanation?
Suggested Answer: 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. Brand equity is an important intangible asset that
has psychological and financial value to the firm.
Page: 276
Level of difficulty: Medium
134.
Your company desires to have positive customer-based brand equity. What has to
occur for this to happen?
Suggested Answer: 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 as compared to when it is not.
Page: 277
Level of difficulty: Easy
135.
Volvo has a strong brand association with respect to brand knowledge when
consumers perceive it as a very safe care (safety). Explain the concept of brand
knowledge.
Suggested Answer: 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.
Page: 277
Level of difficulty: Medium
136.
As a marketing manager, you have made a commitment to having a strong brand.
List five advantages shared by other strong brands that you will most likely have
to emulate to accomplish this objective.
Suggested Answer: Strong brands have the following advantages: (1) improved
perceptions of product performance; (2) greater loyalty; (3) less vulnerability to
competitive marketing actions; (4) less vulnerability to marketing crises; (5)
larger margins; (6) more inelastic consumer response to price increases; (g) more
elastic consumer response to price decreases; (7) greater trade cooperation and
support; (8) increased marketing communications effectiveness; (9) possible
licensing opportunities; and, (10) additional brand extension opportunities.
Students are to pick five of the above.
Page: 277
Level of difficulty: Hard
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Chapter 9: Creating Brand Equity
137.
Brand equity has four components—differentiation, relevance, esteem, and
knowledge. How are these components combined to produce brand strength and
brand stature?
Suggested Answer: Differentiation and relevance combine to produce brand
strength. Esteem and knowledge together create brand stature.
Pages: 278–279
Level of difficulty: Medium
138.
According to Aaker, a particularly important concept for building brand equity is
brand identity. Brand identity is organized around four perspectives. What are
those perspectives?
Suggested Answer: The four perspectives are: (1) brand-as-product, (2) brand-asorganization, (3) brand-as-person, and (4) brand-as-symbol.
Page: 279
Level of difficulty: Hard
139.
According to the BRANDZ model of brand strength, brand building involves a
series of five sequential steps. What are those five sequential steps?
Suggested Answer: The steps are in ascending order: (1) presence, (2) relevance,
(3) performance, (4) advantage, and (5) bonding.
Page: 280
Level of difficulty: Medium
140.
Most strong brands employ multiple brand elements. Nike has three such
powerful brand elements. According to the text, what are those brand elements?
Suggested Answer: Nike’s brand elements are: (1) the distinctive “swoosh” logo,
(2) the empowering “Just Do It” slogan, and (3) the mythological “Nike” name
base on the winged goddess of victory.
Page: 281
141.
Level of difficulty: Medium
As a brand manager you would like to have your brand (brand name) to be
protectible. Explain what you mean by “protectible” and give an illustration.
Suggested Answer: As a brand manager you would have to consider the
questions of “How legally protectible is the brand element?” “How competitively
protectible?” and “Can it be easily be 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. Answers on examples may vary. The above are a few
illustrations that demonstrate the protectible characteristic.
Page: 282
Level of difficulty: Medium
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Part 4: Building Strong Brands
142.
Jones Soda is presented in the text as an example of a company that has succeeded
in personalizing their brand. Discuss how the company has accomplished this
feat.
Suggested Answer: As indicated in the text, Peter van Stolk founded Jones Soda
on the premise that Gen Y consumers would be more accepting of a new softdrink brand if they felt they discovered it themselves. Jones Soda initially was
sold only in shops that sell surfboards, snowboards, and skateboards. The Jones
Soda Web site encourages fans to send in personal photos for possible use on
Jones Soda labels. Although only maybe 40 or so are picked annually from the
tens of thousands of entries, the approach helps to create relevance and an
emotional connection.
Page: 285
Level of difficulty: Hard
143.
Permission marketing is becoming increasingly popular with marketers. Seth
Godin, a pioneer in the technique, recommends five steps in becoming an
effective permission marketer. List Godin’s five steps.
Suggested Answer: Godin’s five steps are: (1) offer the prospect an incentive to
volunteer (e.g., free sample, sales promotion, or contest); (2) offer the interested
prospect a curriculum over time that teaches the consumer about the product or
service; (3) reinforce the incentive to guarantee that the prospect maintains the
permission; (4) offer additional incentives to get more permission from the
consumer; and, (5) over time, leverage the permission to change consumer
behavior toward profits.
Page: 285
Level of difficulty: Hard
144.
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.
Suggested Answer: The two approaches are: (1) an indirect approach assesses
potential sources of brand equity by identifying and tracking consumer brand
knowledge structures; and (2) a direct approach assesses the actual impact of
brand knowledge on consumer response to different aspects of the marketing.
Page: 288
Level of difficulty: Easy
145.
If your marketing manager asked you to design and implement a brand value
chain, explain what you have been asked to do.
Suggested Answer: The brand value chain is a structured approach to assessing
the sources and outcomes of brand equity and the manner in which marketing
activities create brand value. The model assumes that a number of linking factors
intervene between the stages and determine the extent to which value created at
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Chapter 9: Creating Brand Equity
one stage transfers to the next stage. For additional insight and discussion, see
chapter section.
Page: 288
Level of difficulty: Medium
146.
A marketing research manager has just asked you to conduct a brand exploratory.
What have you been asked to do? Explain.
Suggested Answer: The brand exploratory is research activity conducted to
understand what consumers think and feel about the brand and its corresponding
product category to identify sources of brand equity. For additional details, see
chapter section.
Page: 290
Level of difficulty: Easy
147.
Distinguish between brand equity and brand valuation.
Suggested Answer: According to information provided in the text, brand equity
is the added value endowed to products and services. Brand valuation has the job
of estimating the total financial value of the brand.
Pages: 276–290
Level of difficulty: Easy
148.
Volvo is a good illustration of a company that has been successful in defending its
brand equity. However, when Volvo deviated from its brand heritage, sales
slumped. What is the key concept on which the Volvo brand was built and, when
reinforced, eventually revived the company’s slumping sales?
Suggested Answer: According to information provided in the text, Volvo’s key
branding concept is safety.
Page: 293
Level of difficulty: Easy
149.
Scott Bedbury, author of A New Brand World, cites eight principles on which
twenty-first-century branding should be built. List four of those principles.
Suggested Answer: Bedbury’s eight principles are: (1) relying on brand
awareness has become marketing’s fool’s gold; (2) you have to know it before
your can grow it; (3) always remember the Spandex rule of brand extension; (4)
great brands establish enduring customer relationships; (5) everything matters; (6)
all brands need good parents; (7) big is no excuse for being bad; and, (8)
relevance, simplicity, and humanity. Students may choose from any of the above
eight. See chapter section for additional discussion.
Page: 294
Level of difficulty: Hard
150.
As a branding manager, you have recommended to your board of directors a
corporate policy of blanket family branding. Write a brief statement outlining the
advantages of blanket family branding.
Suggested Answer: This policy is followed by Heinz and General Electric. A
blanket family name has advantages. Development cost is less because there is no
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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. Campbell’s introduces new soups under its brand
name with extreme simplicity and achieves instant recognition.
Page: 297
Level of difficulty: Medium
264
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Marketing Management – 12th Edition – Kotler/Keller