Branding & Brand Equity

Question 1

equity as a concept

Answer 1

brand equity refers to added value:

1. the marketing outcomes or effects that accrue beyond those that would accrue without marketing.
2. how does consumer response to marketing change with the increase of brand knowledge

Question 2

financial assessment of consumer behavior

Answer 2

assessment on a profit basis- equity is the incremental earnings
consumer level- the difference in willingness to pay when the product possess name and when it lacks name.

Question 3

financial assessment of corporate behavior

Answer 3

firm level- brand equity value is meshed with tangible and intangible assets in acquisition value. The value of brand equity is greater when competition and noise are high in environment.

Question 4

antecedents of financial performance

Answer 4

before financial metrics, marketers analyze behavioral metrics that consider equity at a consumer level.

1. brand awareness
2. brand attitude
3. brand knowledge
4. brand loyalty

Question 5

awareness

Answer 5

-a necessary prereq to purchase
(cocktail party phenomenon)
(top of mind/ share of mind awareness)

Question 6

attitude

Answer 6

brand evokes feelings, emotions, and change the way a consumer evaluates product

Question 7

meaning

Answer 7

equity encompasses the cognitive associations a consumer has about the brand. positioning and past usage

Question 8

not independent

Answer 8

antecedents are connected, for example past awareness typically associated with more positive attitude toward product

Question 9

Returns on Equity

Answer 9

results that impact financial return

1. communication
2. assessment of quality
3. growth
4. channel power
5. loyalty

Question 10

Growth potential

Answer 10

static value vs potential value

• try to leverage their name when extending current lines or when entering new category
• brand extension uses antecedents (brand assets)

Question 11

Brand extension pros

Answer 11

awareness and liking - the head start associated with previous success - should also equate to positive feelings
trustworthiness - buyer perceives lower risk to new categories
specific associations - qualities you associate with one product transfer to other categories even if competencies don’t correlate

Question 12

Brand extension risks

Answer 12

generalization of failure- ???
dilution of brand meaning - extending into categories that aren’t aligned with values of firm can be detrimental
incompatibility- mishaps on trying to extend to something consumers don’t see compatible
differentiate - to avoid diluting brand name, use different names when extending and capture more market share this way

Question 13

contingencies of “brand sensitivity”

Answer 13

make brand building investment decisions in the context of other firm investment opportunities- as always cost/benefit analysis on basis of:
product type
consumer goals
risk-aversion
other product functional attributes
consumer expertise
company assets