Question 1

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

Accepted Answer

When a brand has a strong reputation, people already know what it means and what to expect from products with that name. This means that the company may not need to spend as much on marketing for a new product, since consumers will already have some level of trust in the brand.

Question 2

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.

Accepted Answer

Dental insurance plans that pay for regular checkups increase the perceived value of dental care by reducing the cost to the consumer.

Question 3

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

Accepted Answer

A brand can facilitate purchasing because the customer can quickly recognize it and make a decision whether to purchase it based on brand associations.

Question 4

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

Accepted Answer

The question directly mentions brand awareness, stating that "Brand awareness is familiarity with the brand and what it stands for." Therefore, the correct answer is A - awareness.

Question 5

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

Accepted Answer

A strong brand can create a competitive advantage by differentiating a firm's products from those of its competitors. This differentiation can make it more difficult for competitors to enter the market and steal customers, thereby protecting the firm from competition.

Question 6

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

Accepted Answer

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

Question 7

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

Accepted Answer

If a brand name becomes synonymous with a product, it could lose its trademark status if it is used in a generic fashion, which is a risk for brand owners.

Question 8

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)

Accepted Answer

The Golden Arches are a brand symbol for McDonald's that most people recognize and associate with the brand. Therefore, they reduce marketing costs.

Question 9

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

Accepted Answer

Perceived value is determined by consumers in relationship to the value of competitors' offerings in a competitive market. Consumers compare the benefits and costs of different offerings to determine which offers the most value for their money.

Question 10

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

Accepted Answer

Band-Aid adhesive bandages have become so popular that the brand name has become synonymous with the product itself, which is known as genericide. People use the term "Band-Aid" to refer to any adhesive bandage regardless of the brand, which is a sign of successful branding.

Question 11

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

Accepted Answer

Familiarity with American-made cars helps consumers make purchase decisions because they are aware of what the brands stand for and can use this information to make an appropriate choice.

Question 12

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

Accepted Answer

While product history may be important for establishing credibility and trust with customers, it may not be the most important factor in creating initial brand awareness.

Question 13

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

Accepted Answer

The Super Bowl offers a huge TV audience, and with it, a major opportunity to build brand awareness. The high cost of the ad is often justified by the potential return on investment in terms of increased brand recognition and sales.

Question 14

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

Accepted Answer

The Enron name has negative brand equity for some people, such that former Enron employees were viewed negatively due to their association with the brand, ultimately impacting their chances of being hired elsewhere. This negative association is a result of the corporate scandal and subsequent negative media coverage. This is an example of negative brand equity.

Question 15

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

Accepted Answer

Nora is likely to choose the store brand sneakers because they offer greater perceived value, as she has had only marginal satisfaction with the brand name sneakers in the past. The store brand may be less expensive and offer similar or comparable quality, thereby providing better value.

Question 16

Brands are assets that can be legally protected through

Accepted Answer

Brands are legally protected through copyrights and trademarks, which give owners exclusive rights to use and control their brand identity and image. These legal protections can prevent others from using similar brand names or designs that may confuse consumers or dilute the value of the brand.

Question 17

The value of a brand is often calculated by assessing the

Accepted Answer

While brand equity and liability and product line depth can be factors in assessing a brand's value, earnings potential over the next year is the most commonly used calculation. Corporate profitability and the effect of brand dilution are also important considerations but are usually factored into the earnings potential calculation.

Question 18

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

Accepted Answer

Building strong brand equity can lead to increased profitability and revenue for a company. This is because customers are willing to pay a higher price for a product that they perceive to have a strong brand value. As a result, investing in building brand equity can be a lucrative strategy for firms.

Question 19

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.

Accepted Answer

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. It represents the value that a brand adds to a product or service beyond the functional benefits of the product or service itself.

Question 20

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?

Accepted Answer

Brand conceptualization is not a criteria used for determining brand equity. The four commonly used criteria are brand awareness, brand loyalty, brand associations, and perceived value.

Quiz 11: Product, Branding, and Packaging Decisions