Deck 11: Product, Branding, and Packaging Decisions

Question 1

The more familiar customers are with a brand, the harder their decision-making process will be.
Familiarity with a brand makes the decision-making easier, not harder.

Answer 1

False

Question 2

A company's product line consists of its various product mixes.
This is backward. A company's product mix consists of its various product lines.

Answer 2

False

Question 3

Harold is a loyal Coca-Cola customer. Loyal customers like Harold require lower marketing expenditures, benefiting businesses like Coca-Cola.
The costs of reaching loyal customers are lower, and their positive word of mouth reaches potential customers and reinforces the perceived value of current customers, all at no cost to the firm.

Answer 3

True

Question 4

If Microsoft decided to sell mobile phones under the Xbox brand (which it uses for its gaming systems), this would be an example of a line extension.
This is a brand extension, not a line extension. A brand extension is the use of the same brand name in a different product line. Phones and gaming systems are different product lines.

Question 5

Sales of private-label brands continue to decline in the U.S., particularly in big-box stores such as Costco.
Sales of private-label brands continue to rise in the North America, where they account for about 20 percent of retail sales. Costco is a leader in the use of private-label brands.

Question 6

A customized carved cedar wood sign for your house is an example of a convenience product.
A specialty product is one toward which customers show a strong preference, such that they will spend time and effort searching for the best suppliers. A customized product such as the cedar sign is a specialty product.

Question 7

For the average college student, a retirement account would be a shopping product.
Most college students are not thinking of preparing for retirement, so a retirement account would be an unsought product.

Question 8

When Jaclyn selects a case of Sprite at the grocery store for her party, she is attracted by the holiday-themed box featuring green and white bells. What Jaclyn is seeing is referred to as the secondary package.
The secondary package is the wrapper or exterior carton that contains the primary package and provides the UPC label used by retail scanners. The packaging is used to attract the consumer's attention.

Question 9

Private-label brands are imitations often sold by street vendors.
A private-label brand is a retailer or store brand, developed by retailers to be sold only within their own stores.

Question 10

When purchasing a mobile phone, the product you are buying is more than just the phone.
The three components of a product are the core customer value, the actual product, and the associated services. In this case the associated services include the cellular service.

Question 11

Jenny traded in her old car for her heart's desire, a new Lexus sedan. The Lexus is considered a specialty product.
Luxury cars are specialty products because customers are willing to spend more effort to select just the right one.

Question 12

Brands enable customers to quickly differentiate one firm or product from another.
As consumers become familiar with brands, they can more quickly differentiate between various offerings.

Question 13

Kellogg's sells many breakfast cereals, including Corn Flakes, Rice Krispies, Frosted Flakes, Raisin Bran, and Special K. This is an example of the breadth of the Kellogg's product mix.
Product line depth (not breadth) equals the number of products within a product line, as in this question.

Question 14

Nike sells shoes, clothing, and athletic gear. These represent the breadth of Nike's products.
A firm's product mix breadth represents a count of the number of product lines offered by the firm.

Question 15

A product is anything that is of value to a consumer and can be offered through a voluntary exchange.
This is the definition of a product.

Question 16

In entertainment licensing, the major risk to licensees is that the brand will become overexposed.
The licensor is the party granting the license, whereas the licensee is the one using the license to produce products using the licensed characters. For licensors, the major risk is the dilution of the brand.

Question 17

Effective packaging and labels send the signal: "Buy me."
Good packaging and labeling can grab the consumer's attention and encourage the consumer to buy.

Question 18

Brand equity is calculated by subtracting sales of generic brands from the sales of branded items in a category.
Brand equity is the set of assets and liabilities linked to a brand that add to or subtract from the value provided by the product or service.

Question 19

A product label is just a required sticker on a package.
A label is much more than that. It can help to sell the product; it also provides key information, which is sometimes regulated by the government.

Question 20

For a company like Pepsi-Cola, brand dilution occurs when sells more product than the competition.
Brand dilution refers to overuse of the brand for brand extensions, such that brand equity becomes weaker.

Question 21

Claire always liked Lands' End raincoats, so when she was shopping for a winter coat, she just ordered one from Lands' End without thinking too much about it. This demonstrates how brands facilitate purchases.
Brands are often easily recognized by consumers, and because they signify a certain quality level and contain familiar attributes, brands help consumers make quick decisions, especially about their purchases.

Question 22

A product is __________ that can be offered through a voluntary marketing exchange.

A) the combination of a firm's marketing mix
B) the brand associations
C) the category depth
D) a tangible item
E) anything of value to consumers
This is the definition of a product. It does not have to be a tangible item; it can also be a service or a combination of a good and associated services.

Question 23

Brands are assets that can be legally protected through trademarks.
Brands are assets that can be legally protected through trademarks and copyrights and thus constitute a unique form of ownership.

Question 24

Marketers spend billions of dollars annually attempting to build effective brands. One basic benefit of a brand is that it

A) creates a basis for effective packaging.
B) provides a way for a firm to differentiate its product offerings from competitors.
C) offers consumers promotional parity.
D) allows manufacturers to capitalize on promotional expenditures.
E) reduces the need for product line depth.
Brands are intended to differentiate a firm's offerings from those of its competition.

Question 25

Manufacturers, wholesalers and retailers can all own brands.
This is correct; any kind of firm in the supply chain can own brands.

Question 26

The decision to delete a product is never taken lightly because, generally, manufacturers have

A) offered the product line to other firms for purchase.
B) made substantial investments in product development and manufacturing.
C) promised consumers they will maintain the product.
D) used brand repositioning to improve results.
E) federal standards that must be met when taking products off the market.
Firms invest in developing new products, and they will not walk away from that investment lightly.

Question 27

__________ is the number of items within a product line.

A) Brand equity
B) Product line breadth
C) Product line depth
D) Product mix depth
E) Product mix breadth
Product line depth is the number of items in a product line. Firms make strategic decisions about the appropriate product line depth based on their resources and objectives.

Question 28

For a brand name to be effective, it needs to be

A) easy for consumers to recognize and remember.
B) a catchy, tongue-twisting phrase.
C) a visual image containing human characters.
D) generic, so it can be applied to as many products as possible.
E) associated with a sports or movie superstar.
A brand name should be memorable and easy to recognize, in general.

Question 29

A __________ is a group of associated items that consumers tend to use together or think of as part of a group of similar products.

A) product line
B) product mix
C) product mix breadth
D) line extension
E) brand extension
A product line is a subset of the product mix, a collection of associated items that consumers either use together or consider to be related to each other.

Question 30

A familiar brand name always helps the sales of a product.
Even if the overall brand name is familiar, it won't help sales of individual products unless consumers know what products are available under that name and the brand has a positive image.

Question 31

It is almost impossible to watch a sporting event on television without seeing Nike's swoosh check mark, which is Nike's

A) name.
B) symbol.
C) design.
D) term.
E) theme.
The "swoosh" is a brand symbol associated with Nike. The firm has invested a great deal of time and money in making the swoosh one of the most recognizable brand symbols in the world.

Question 32

Zappos is a successful online shoe company. One of the difficulties in running a shoe company is the need to have significant __________, a large number of items in each product line.

A) brand equity
B) product line breadth
C) product line depth
D) product mix depth
E) product mix breadth
Product line depth is the number of items in a product line. Zappos promises its customers a huge selection, and so it must maintain great product line depth.

Question 33

For many years, General Electric's corporate strategy was to be among the top three firms in any market in which it operated; if it could not achieve a top-three position, it would exit the market. This strategy often resulted in the company __________ when certain product lines failed to meet this expectation.

A) increasing product line depth
B) decreasing product line depth
C) decreasing product mix breadth
D) increasing product mix breadth
E) introducing brand extensions
If GE could not achieve first, second, or third place in a market, it would eliminate a product line, which decreases the product mix breadth.

Question 34

Which of the following scenarios is NOT a reason a firm would eliminate an item within a product line?

A) The firm decided to refocus marketing efforts elsewhere.
B) The firm must respond to evolving markets.
C) The product undermined its own brand.
D) The product being eliminated is unprofitable.
E) The firm has decided to capture new markets.
All of these are reasons firms might decide to delete a product from a product line, except the desire to capture new markets.

Question 35

A decrease in a company's product depth will always hurt its marketing efforts.
From time to time, it is necessary to delete products within a product line to realign the firm's resources.

Question 36

The complete set of all products offered by a firm' is called its

A) product line.
B) product categories.
C) product mix.
D) product breadth.
E) product line depth.
The product mix is the complete set of all the firm's offerings.

Question 37

Marketers with successful brands sometimes hesitate to expand their brands because

A) Federal Trade Commission regulations limit the number of products that can be marketed under an individual brand name.
B) it is costly to maintain many product lines, and it might weaken the brand's meaning.
C) it is often difficult to get additional marketing communications coverage for the brand.
D) manufacturing divisions usually control brand expansion and are often in conflict with the marketing division.
E) the current economy can only support a limited number of product options.
Each product line involves some additional cost, and if too many product lines are associated with the same brand, it can weaken the brand's meaning and reputation.

Question 38

For a major university, undergraduate studies, graduate studies, and professional programs would be __________ within the university's product mix.

A) brand associations
B) family brands
C) co-brands
D) product lines
E) private label brands
For the university, these would be product lines. Within each product line would be specific majors.

Question 39

One important purpose of a brand is to

A) sell advertising space.
B) minimize product line depth needed to be effective.
C) increase consumer recognition and awareness of product offerings.
D) inform product packaging.
E) meet government regulations.
Brands help consumers know what products are available under that name.

Question 40

A university that has separate graduate and undergraduate admission offices recognizes that these are distinct

A) brand associations.
B) product lines.
C) product mixes.
D) brands.
E) augmented services.
Graduate and undergraduate programs at most universities are distinct product lines, with each product line including multiple degrees.

Question 41

Firms that use the same brand name for new products can spend relatively less on marketing costs for the new product because

A) brands protect corporate copyrights.
B) consumer loyalty can be bought for less now compared to the past.
C) brand equity can only be obtained by means of product line depth.
D) people already know what the brand means.
E) well-known brands are less likely to introduce brand extensions.
Once a brand has established strong associations with its name, the firm may be able to spend less on promoting new products since consumers already recognize the brand and know what it stands for.

Question 42

Relatively few consumers like to go to the dentist. Dental insurance plans that pay for regular checkups increase the __________ of dental care by reducing the cost to the consumer.

A) perceived value
B) brand awareness
C) brand loyalty
D) generic positioning
E) brand extension
The perceived value of a good or service is the relationship between its benefits and its costs. By reducing the cost, the value will be seen to be greater.

Question 43

When consumers associate a brand with a certain level of quality and familiar attributes, allowing consumers to make quick decisions, the brand

A) establishes novelty.
B) is the only one the consumer will consider.
C) reduces delivery costs.
D) facilitates purchasing.
E) creates brand dilution.
A brand can facilitate purchasing because the customer can quickly recognize it and decide whether to purchase it based on brand associations.

Question 44

If many consumers in the marketplace are familiar with a brand and what it stands for and have an opinion about the brand, the brand has considerable

A) awareness.
B) equity.
C) extension.
D) integration.
E) co-branding.
Brand awareness is familiarity with the brand and what it stands for.

Question 45

One key feature of the value of a strong brand is that

A) it can protect the firm from competition.
B) it no longer needs to be supported by advertising and promotion.
C) if it becomes a generic name, the brand is worth even more.
D) it cannot be successfully imitated by a retailer's own brand.
E) competitors will typically abandon a sector altogether rather than compete.
Strong brands protect the firm somewhat from competition because the brand differentiates the firm's products, making customers more loyal.

Question 46

A __________ brand is one where there is a contractual arrangement between firms allowing one to use its brand name for a fee.

A) franchise
B) joint venture
C) shared
D) common use
E) licensed
This is the definition of a licensed brand, such as Ralph Lauren, which firms pay a fee to use.

Question 47

Sometimes brand names become synonymous with a product itself. If that happens, the brand

A) has achieved brand stabilization.
B) could lose its trademark status.
C) should try co-branding to avoid brand dilution.
D) should consider a new packaging strategy.
E) easily eliminates all competition.
Brand names that become synonymous with the product-like Kleenex, Clorox bleach, and Scotch tape-must protect against the use of the brand name in a generic fashion, or they may lose their trademark on the name.

Question 48

Parents of young children have been known to drive out of their way so their kids will not see McDonald's Golden Arches and plead with their parents to stop. For McDonalds, the Golden Arches reduce marketing costs because people (including young children)

A) have memorized the McDonald's menu.
B) prefer yellow to other colors.
C) know what the Golden Arches brand symbol means.
D) recognize increases in product line depth.
E) are sensitive to brand repositioning.
The Golden Arches are a brand symbol for McDonald's. The company has invested in ensuring that consumers recognize the symbol and associate it with the brand.

Question 49

In a competitive market, perceived value is determined by consumers mostly

A) by quantitative analysis of brand personalities.
B) in relationship to the value of competitors' offerings.
C) by weighing primary versus secondary benefits.
D) by trying out different products.
E) through brand association and brand licensing.
The perceived value of a good or service is the relationship between its benefits and its costs. In a competitive market, these benefits and costs will be easiest to evaluate in comparison to competitive offerings.

Question 50

In the case of Band-Aid adhesive bandages, the brand name has

A) successfully employed private label branding.
B) distinctive brand substitutability.
C) grown through private label branding.
D) become synonymous with the product itself.
E) avoided brand extensions.
Brand names that become synonymous with the product must protect against the use of the brand name in a generic fashion, or they may lose their trademark on the name.

Question 51

Whether they like them or not, most U.S. automobile customers are familiar with and have an opinion about American-made cars. This familiarity makes it easier for consumers to

A) meet their self-actualization needs.
B) make purchase decisions.
C) consider repositioning their opinions.
D) pursue generic alternatives.
E) negotiate discounts.
Familiarity with brands helps consumers to make purchase decisions because they are aware of what the brands stand for and can use this information to make an appropriate choice.

Question 52

Salina is working to create greater brand awareness for her company's new line of personal digital assistants. To increase brand awareness, the LEAST important information that should be included in promotions is

A) the brand name.
B) the logo.
C) the packaging.
D) the slogan.
E) the product history.
The brand name, logo, packaging, and slogan are all important in creating brand awareness.

Question 53

Why would a firm spend over $2 million for a 30-second ad on television during the Super Bowl?

A) because of the annual competition for the most creative Super Bowl ad
B) because the Super Bowl offers an opportunity to create significant brand awareness
C) because the Super Bowl is a significant opportunity to be associated with global marketing
D) because Super Bowl ads generate brand loyalty
E) There is no good reason to spend over $2 million for a Super Bowl ad
Some firms might agree that it doesn't make sense to spend so much money on a Super Bowl ad; however, the Super Bowl offers a huge TV audience and, with it, a major opportunity to build brand awareness.

Question 54

Many former Enron professionals who had nothing to do with the corporate scandal found that listing employment with Enron hurt their chances of being hired elsewhere. For these people, the Enron name has

A) no brand associations.
B) unspent brand loyalty.
C) private label impact.
D) brand dilution.
E) negative brand equity.
The Enron name has negative brand equity for some people, such that some former Enron employees were viewed negatively due to their association with the brand.

Question 55

Nora is deciding whether to purchase brand name sneakers or a store brand. She has purchased other shoes with the same brand name in the past but was only marginally satisfied. In this situation, Nora is likely to purchase the store brand sneakers because they offer

A) more brand awareness.
B) higher degrees of brand loyalty.
C) greater perceived value.
D) a better brand image.
E) more product line depth.
Since Nora's past experience with name brands has been marginal, she might prefer to buy the store brand, which is probably less expensive and might therefore provide better value.

Question 56

Brands are assets that can be legally protected through

A) copyrights and trademarks.
B) financial reporting.
C) brand extensions.
D) generic branding.
E) corporate branding strategies.
Brands can be legally protected through copyrights and trademarks.

Question 57

The value of a brand is often calculated by assessing the

A) difference between brand equity and brand liability.
B) corporate profitability divided by the monthly brand earnings.
C) earning potential of the brand over the next 12 months.
D) effect of brand dilution if it occurred.
E) average product line depth.
Earnings potential over the next year offers a rough estimate of a brand's value.

Question 58

Firms spend millions of dollars annually to build brand equity, that recognizing brand equity contributes to

A) product mix breadth.
B) corporate stakeholder relations.
C) profitability.
D) brand liability.
E) perceived brand personality.
Brands are assets that can produce profits if brand equity is built successfully.

Question 59

Brand __________ is the set of assets and liabilities linked to a brand that add to or subtract from the value provided by the product or service.

A) positioning
B) licensing
C) association
D) equity
E) solvency
This is the definition of brand equity.

Question 60

Which of the following is NOT one of the four criteria used for determining how good a brand is or how much equity it has?

A) brand awareness
B) brand loyalty
C) brand associations
D) brand conceptualization
E) perceived value
Brand awareness, brand loyalty, brand associations, and perceived value are the four primary criteria used to evaluate brand equity.

Question 61

Procter & Gamble is a huge national brand manufacturer. By having leading brands like Tide and Crest, P&G

A) can monopolize store brands.
B) has greater opportunity to dictate retail pricing.
C) has greater control over marketing strategy.
D) can increase brand dilution.
E) can eliminate any local competition.
Brand ownership gives the owner greater control over marketing strategy-the ability to position the brand and to establish the marketing mix.

Question 62

Lionel Smith Ltd. is a traditional men's clothing store. Every fall the owner sends an embossed invitation (much like a wedding invitation) to his regular customers, inviting them to a private reception showing the new fall line of clothes. For Lionel Smith Ltd., one of the benefits of having established a loyal customer base is

A) recognition through industry awards.
B) lower marketing costs associated with reaching loyal customers.
C) that he can be less concerned about competitors' actions.
D) increased price sensitivity among loyal customers.
E) less need for concern about product quality.
Loyal customers are less likely to switch brands due to competitor actions.

Question 63

Brands can be owned by

A) manufacturers only.
B) any firm in the supply chain.
C) retailers only.
D) wholesalers and retailers only.
E) only private label generic retailers.
Any firm in the supply chain-manufacturer, retailer, distributor, and so on-can own a brand.

Question 64

Laura prefers Sony products and will only purchase alternatives when there are no Sony products available. Laura's brand loyalty means she is most likely

A) relatively insensitive to price.
B) uninformed about the product category.
C) product category committed.
D) a brand equity investor.
E) a savvy consumer.
Because Laura is loyal to Sony, she is likely to stay with the brand even if the price rises or if competitors offer cheaper options. This means that she is less price sensitive.

Question 65

Brand extension is a popular marketing strategy because

A) it separates out the cost of brand extension from brand intention.
B) it allows the firm to discontinue complementary products.
C) the firm can spend less on creating brand awareness and associations.
D) it avoids the problem of brand dilution.
E) it guarantees success for a new product.
Since consumers are already familiar with the brand name, existing awareness and associations will transfer to the new product.

Question 66

Matt was passionate about Abercrombie & Fitch. It was the only place he'd buy his clothes. If anyone asked him about clothes, he would talk for what seemed like hours about why he only shopped there. From a strictly marketing perspective, this word of mouth is an element of

A) social marketing.
B) brand loyalty.
C) self-actualization.
D) motivation.
E) brand extension.
Matt's word of mouth behavior is an outcome of his brand loyalty.

Question 67

Brands that are owned by ___________ are called private-label brands.

A) manufacturers
B) wholesalers
C) supply chain specialists
D) retailers
E) manufacturer's reps
Brands owned by retailers are called store brands, house brands, own brands, or private-label brands.

Question 68

Private-label brands are developed and managed by

A) manufacturers.
B) wholesalers.
C) supply chain specialists.
D) manufacturer's reps.
E) retailers.
Private-label brands are brands developed by retailers.

Question 69

The basic reason manufacturers spend time and money building their own brands is to

A) create brand awareness.
B) build brand equity.
C) offset the power of private label manufacturers.
D) create positioning possibilities for their generic product lines.
E) maximize product line depth.
Companies invest in brands to build brand equity, which is a corporate asset.

Question 70

One of the major tools used by marketers to meet the needs of loyal customers is

A) SKU.
B) PDQ.
C) IMF.
D) CRM.
E) GATT.
CRM (customer relationship management) programs often include reward programs aimed at loyal customers.

Question 71

The potential benefits of brand extension do NOT include

A) allowing the perception of a brand with a quality image to be carried over to the new product.
B) lowering marketing costs.
C) boosting sales of the core brand.
D) spending less on creating brand awareness and associations.
E) eliminating competition.
Since consumers are already familiar with the brand name, existing awareness and associations will transfer to the new product. In addition, benefits may transfer back to the core brand and increase its sales.

Question 72

When Procter & Gamble added teeth whitening products under the Crest brand, the firm was engaged in

A) corporate branding.
B) brand extension.
C) brand licensing.
D) brand association.
E) perceived value branding.
This was a brand extension, using the Crest brand name for a new product line.

Question 73

Which of the following is the best example of a family brand?

A) Cadillac, GMC, and Chevrolet
B) Tostitos Multigrain Scoops and Tostitos Chunky Salsa
C) Kellogg's Special K and Famous Amos Chocolate Chip Cookies
D) Lifesavers Soda, Coca Cola, and Diet Coke
E) KFC / Taco Bell Fast Foods
A firm can use its own corporate name to brand all its product lines and products, referred to as a family brand.

Question 74

Frequent buyer / user award programs are used to

A) increase price sensitivity.
B) decrease co-branding costs.
C) lower licensing fees.
D) expand product line depth.
E) maintain contact with loyal customers.
Frequent buyer programs and similar loyalty programs are often part of a CRM (customer relationship management) program.

Question 75

For marketers, one of the benefits of having achieved brand loyalty is

A) recognition through industry awards.
B) lower marketing costs associated with reaching loyal customers.
C) increased price sensitivity among loyal customers.
D) greater concern about competitors' actions.
E) few worries about copyright infringement.
Brand loyal customers are already convinced of the brand's value. It is not necessary to spend large sums of money to build awareness and preference for the brand among these customers.

Question 76

Another name for a manufacturer's brand is a(n) __________ brand.

A) systematic
B) extended
C) national
D) premium
E) private-label
The terms "manufacturer's brand" and "national brand" both refer to brands owned and managed by manufacturers.

Question 77

________ is another term for private-label brands.

A) Store brands
B) Off brands
C) Manufacturer brands
D) National brands
E) Experiential brands
Private-label brands are also referred to as retailer or store brands.

Question 78

A personal digital assistant programmed with key customers' birthdates, wine preferences, and food allergies is a(n) __________ tool.

A) SKU
B) PDQ
C) IMF
D) CRM
E) GATT
Keeping track of customers' preference enhances the relationship and increases brand loyalty, all part of customer relationship management (CRM).

Question 79

Jenna always buys Stacy's brand pita chips. She does not even consider alternatives. Jenna is a __________ customer.

A) price sensitive
B) brand persuasion oriented
C) brand association oriented
D) brand extension oriented
E) brand loyal
Since Jenna does not consider other brands, she is brand loyal.

Question 80

Consumers might not realize that Old Spice health and wellness products and Iams pet nutrition products are made by the same company-Procter & Gamble. Old Spice and Iams are known as

A) individual brands.
B) family brands.
C) corporate brands.
D) traditional brands.
E) registered brands.
Old Spice and Iams are individual brands, separate brand names for different product lines.