Module 6

Question 1

Brands themselves may be linked to other entities that have their own

Answer 1

knowledge structures in the minds of consumers

Question 2

… in effect, the brand “borrows” brand knowledge and, depending on the true nature of those associations and responses, perhaps some brand equity from other entities.
This indirect approach to building brand equity is known as

Answer 2

leveraging secondary brand knowledge for the brand.

Question 3

secondary sources of brand knowledge

Answer 3

(Other Brands)
Alliances
Ingredients
Compant
Extensions

(People)
Emplyees
Endorsers

(Things)
Events
Causes
3rd Party Endorsers

(Places)
Channels
Country of Origin

Question 4

By making a connection between the brand and another entity, consumers may form a

Answer 4

mental association from the brand to this other entity and, consequently, to any or all associations, judgments, feelings, and the like linked to that entity.

Question 5

Secondary brand knowledge affects evaluations of

Answer 5

a new product when the consumer lacks either the motivation or the ability to judge product-related concerns.

Question 6

Three important factors in predicting the extent of leverage from linking the brand to another entity:

Answer 6

1. Awareness & Knowledge of the Entity
2. Meaningfulness of the Knowledge of the Entity
3. Transferability of the Knowledge of the Entity

Question 7

Awareness & Knowledge of the Entity

Answer 7

If consumers have no familiarity with or knowledge of the secondary entity, then obviously there is nothing they can transfer from it.
Ideally, consumers would be aware of the entity; hold some strong, favorable, and perhaps even unique associations about it; and have positive judgments and feelings about it.

Question 8

Meaningfulness of the Knowledge of the Entity

Answer 8

Given that the entity evokes some positive associations, judgments, or feelings, is this knowledge relevant and meaningful for the brand? The meaningfulness may vary depending on the brand and product context. Some associations, judgments, or feelings may be relevant to and valuable for the brand, whereas others may seem to consumers to have little connection.

Question 9

Transferability of the Knowledge of the Entity

Answer 9

Assuming that some potentially useful and meaning associations, judgments, or feelings exist regarding the entity and could possibly transfer to the brand, how strongly will this knowledge actually become linked to the brand?

Question 10

Conceptualizing the Leveraging Process

Answer 10

Transfering these feature between your brand and other entities:

Awareness
Attributes
Benefits
Images
Thoughts
Feelings
Attitudes
Experiences

Question 11

Commonality leveraging strategy makes sense when

Answer 11

consumers have associations to another entity that are congruent with desired brand associations.

Question 12

On the other hand, there may be times when entities are chosen that represent a departure for the brand because

Answer 12

there are few if any common or similar associations.

Question 13

Such complementarity branding strategies can be strategically critical in terms of

Answer 13

delivering the desired position.

Question 14

Even if consumers buy into the association one way or another, leveraging secondary brand knowledge may be risky because

Answer 14

the marketer gives up some control of the brand image.

Question 15

Branding strategies are an important determinant of

Answer 15

the strength of association from the brand to the company and any other existing brands.

Question 16

Three main branding options exist for a new product:

Answer 16

Create a new brand

Adopt or modify an existing brand

Combine an existing and a new brand

Question 17

In 2006 HP introduced a new campaign for its personal computers, themed

Answer 17

“The Computer Is Personal Again.” TV ads featured celebrities such as Vera Wang, Serena Williams and Jerry Seinfeld.

Question 18

Besides the company that makes the product, the country (or geographic location) from which it originates may also

Answer 18

become linked to the brand and generate secondary associations. Many countries(or geographic areas) have become known for expertise in certain product categories or for conveying a particular type of image.

Question 19

Becoming strongly linked to a country of origin or specific geographic region is not without potential disadvantages.

Answer 19

Events or actions associated with the country may color people’s perceptions. For example, strong connections to a country may pose problems if the firm desires to move production elsewhere.

Question 20

The __ of a country-of-origin association from both a domestic and a foreign perspective also needs to be considered.

Answer 20

favorability

Question 21

Marketers can embed the location in the brand name.

For example:

Answer 21

Irish Spring

Question 22

Associations to the origin almost always have the potential to be created at the point of purchase and to affect brand decisions there. Consider the favorability of a country-of-origin association from both a domestic and a foreign perspective.

For example:

Answer 22

Waterford Crystal

Question 23

A number of brands are able to create a strong point of difference, in part because of

Answer 23

consumers’ identification of and beliefs about the country of origin.

Question 24

Because of associations to product assortment, pricing and credit policy, quality of service and so on, retailers have their own

Answer 24

brand images in consumers’ minds

Question 25

Retailers create these brand associations through

Answer 25

the products and brands they stock and the means by which they sell them.

Question 26

To more directly share their images, many retailers

Answer 26

aggressively advertise and promote directly to customers

Question 27

a consumer may infer certain characteristics about a product on the basis of

Answer 27

where it is sold. “If it’s sold at Nordstrom, it must be of good quality.”

Question 28

Transfer of store image associations can be either __ or __ for a brand.

Answer 28

positive or negative

Question 29

Co-branding — also called ‘brand bundling’ or ‘brand alliances’ — occurs when

Answer 29

two or more existing brands are combined into a joint product or are marketed together in some fashion.

Question 30

Advantages of Co-branding

Answer 30

Product may be uniquely and convincingly positioned by virtue of the multiple brands in the campaign

Creates more compelling points of difference or points of parity for the brand — or both — than otherwise might have been feasible

Generates greater sales from the existing target market as well as opens additional opportunities with new consumers and channels

Reduce the cost of product introduction because it combines two well-known images, accelerating potential adoption

Valuable means to learn about consumers and how other companies approach them

In poorly differentiated categories, co-branding may be an important means of creating a distinctive product

Question 31

Disadvantages of Co-branding

Answer 31

Risks and lack of control that arise from becoming aligned with another brand in the minds of consumers… consumers’ expectations about the level of involvement and commitment with co-brands are likely to be high
Unsatisfactory performance could have negative repercussions for both brands
If the other brand has entered into a number of co-branding arrangements, there also may be a risk of overexposure that would dilute the transfer of any association… it may result in distraction and a lack of focus on existing brands

Question 32

Advantages of Co- Branding
(summarized)

Answer 32

Borrow needed expertise

Leverage equity you don’t have

Reduce cost of product introduction

Expand brand meaning into broaden meaning and increase access points categories

Source of additional revenues

Question 33

Disadvantages of Co- Branding
(Summarized)

Answer 33

Loss of control

Risk of brand equity dilution

Negative feedback effects

Lack of brand focus and clarity

Organizational distraction

Question 34

To create a strong co-brand, both brands should have

Answer 34

adequate brand awareness;

sufficiently strong, favorable and unique associations;

and positive consumer feelings.

Question 35

Marketers must enter into and execute co-branding ventures carefully.
They must ensure the right kind of fit in

Answer 35

values,

capabilities,

and goals in addition to

an appropriate balance of brand equity.

Question 36

More generally, brand alliances, such as co-branding, require marketers to ask themselves a number of questions, such as:

Answer 36

What capabilities do we not have?

What resource constraints do we face (people time, money)?

What growth goals or revenue needs do we have?

Question 37

In assessing a joint branding opportunity, marketers will ask themselves:

Answer 37

Is it a profitable business venture?

How does it help to maintain or strengthen brand equity?

Is there any possible risk of dilution of brand equity?

Does it offer any extrinsic advantages such as learning opportunities?

Question 38

A special case of co-branding is ingredient branding, which creates

Answer 38

brand equity for materials, components, or parts that are necessarily contained within other branded products.

Question 39

From a consumer perspective, branded ingredients are often a signal of

Answer 39

quality.

Question 40

Ingredient branding has become more prevalent as
mature brands seek cost-effective means to

Answer 40

differentiate themselves on the one hand, and potential ingredient products seek means to expand their sales opportunities on the other hand.

Question 41

Examples of Ingredient Branding

Answer 41

Food Products: Betty Crocker’s w/ Hershey’s Chocolate

Electronics: A technology store with appliances that have Microsoft or Sprint features

Question 42

Advantages of Ingredient Branding

Answer 42

Firm making and supplying the ingredient:
-Generate greater sales at a higher margin
-More stable and broader customer demand
-Better long-term supplier-buyer relationships

Manufacturer of the host product:
-Ability to leverage the equity from the ingredient brand to enhance its own brand equity
-Access to new product categories, different market segments, and more distribution channels
-Share in some of the production and development costs with the ingredient supplier

Question 43

Disadvantages of Ingredient Branding

Answer 43

Marketing:
Costs of supporting a marketing communication program can be high

As with co-branding, there is a loss of control, because marketing programs for the supplier and manufacturer may have different objectives and thus may send different signals to consumers

Manufacturers may resent any consumer confusion about what is the “real brand” if the branded ingredient gains too much equity

Question 44

Guidelines of Ingredient Branding

Answer 44

1. Consumers must first perceive that the ingredient matters to the performance and success of the end product.
2. Consumers must then be convinced that not all ingredient brands are the same and that this ingredient is superior.
3. A distinctive symbol or logo must be designed to clearly signal to consumers that the host product contains the ingredient.
4. A coordinated push and pull program must be put in place such that consumers understand the importance and advantages of the branded ingredient.

Question 45

Licensing creates

Answer 45

contractual arrangements whereby firms can use the names, logos, characters, and so forth of other brands to market their own brands for some fixed fee.

Question 46

When licensing, Essentially, a firm is “__” another brand to contribute to the brand equity of its own product

Answer 46

renting

Question 47

Because it can be a shortcut means of building brand equity, licensing has gained in popularity in recent years —

Answer 47

North American retail sales of licensed products jumped from $4 billion in 1977 to $72 billion in 2005.

Question 48

One danger in licensing is that manufacturers can get caught up in licensing a brand that

Answer 48

might be popular at the moment but is really only a fad and produces short-lived sales.

Question 49

Corporate trademark licensing —

Answer 49

one of the fastest-growing segments of the licensing industry — is the licensing of names, logos, or brands for use on various, often unrelated products.

Question 50

In licensing their corporate trademarks, firms may have different motivations, including

Answer 50

generating extra revenues and profits, protecting their trademark, increasing their brand exposure, or enhancing their brand image.

Question 51

Using well-known and admired people to promote products is a

Answer 51

widespread phenomenon with a long marketing history.

Question 52

The rationale behind celebrity endorsement strategies is that

Answer 52

a famous person can draw attention to a brand and shape the perceptions of the brand, by virtue of the inferences that consumers make based on the knowledge they have about the famous person. The celebrity must be well enough known to improve awareness, image, and responses of the brand.

Question 53

A celebrity endorser should have a

Answer 53

high level of visibility and a rich set of potentially useful associations, judgments, and feelings. Ideally, he or she would be credible in terms of expertise, trustworthiness, and likability or attractiveness, as well as having specific associations that carry potential product relevance.

Question 54

Top 5 Celebrities in Q Ranking Chart

Answer 54

1. Tom Hanks
2. Mel Gibson
3. Bill Cosby
4. William Petersen
5. Sean Connery

Question 55

Celebrity endorses can endorse so many products that they

Answer 55

lack any specific product meaning or are seen as opportunistic or insincere. (Anna Kournikova leveraged her good looks to sign endorsements worth millions of dollars with a variety of brands)

Question 56

There must be a reasonable match between the celebrity and

Answer 56

the product. (classic mismatch between Bristol Myers Datril pain reliever and Western actor John Wayne)

Question 57

Celebrity endorsers can get in trouble or lose popularity, diminishing their

Answer 57

marketing value to the brand, or just fail to live up to expectations. (O.J. Simpson, Martha Stewart, Michael Jackson)

Question 58

Many consumers feel that celebrities are only doing the endorsement for

Answer 58

the money and do not necessarily believe in or even use the endorsed brand. (Nike campaign and Andre Agassi)

Question 59

Celebrities may distract attention from the brand in ads so that consumers notice the stars but

Answer 59

have trouble remembering the advertised brand. (Pepsi Campaign: Beyonce Knowles and Britney Spears; Chrysler Campaign: Celine Dion)

Question 60

Guidelines for Celebrity Endorsement

Answer 60

1. Choose a well-known and well-defined celebrity whose associations are relevant to the brand and likely to be transferable.
2. There must be a logical fit between the brand and the person.
3. The advertising and communication program should use the celebrity in a creative fashion that highlights the relevant associations and encourages their transfer.
4. Marketing research must help identify potential endorser candidates and facilitate the development of the proper marketing program, as well as track their effectiveness.

Question 61

Sponsored events can contribute to brand equity by

Answer 61

becoming associated to the brand and improving brand awareness, adding new associations, or improving the strength, favorability, and uniqueness of existing associations.

Question 62

The main means by which an event can transfer associations is

Answer 62

credibility… a brand may seem more likeable or perhaps even more trustworthy by virtue of becoming linked to an event.

Question 63

The extent to which this transfer through sponsored events takes place will depend on

Answer 63

which events are selected and how the sponsorship program is designed and integrated into the entire marketing program to build brand equity.

Question 64

Marketers can create secondary associations in a number of different ways by

Answer 64

linking the brand to various third-party sources.

The Good Housekeeping seal has been seen as a mark of quality for decades, offering product replacement or refunds for defective products for up to two years from purchase.

Question 65

Third-party sources can be especially credible sources. As a result, marketers often feature them in

Answer 65

advertising campaigns and selling efforts.

J.D. Power and Associates’ well-publicized Customer Satisfaction Index helped to cultivate an image of quality for Japanese automakers in the 1980s, with a corresponding adverse impact on the quality image of their U.S. rivals.

Question 66

Grey Goose Example:

Answer 66

Sidney Frank first found success in the liquor industry with a little known German liqueur, Jagermeister, which he began to market in the United States in the mid-1980s and drove to 700,000 cases in sales and market leadership by 2001. Turning his sights to the high-margin super-premium market, Frank decided to create a French vodka that would use water from the Cognac region and be distilled by the makers of Cardin brandy. Branded as “Grey Goose,” the product had distinctive packaging — a must in the category — with a bottle taller than competitors that combined clear and frosted glass with a cutaway of geese in flight and the French flag.
But perhaps the most important factor in the brand’s eventual success was a taste test result from the Beverage Testing Institute that ranked Grey Goose as the number-one imported vodka. Fueled by exhaustive advertising that trumpeted its big win, Grey Goose became a top seller. Frank eventually sold Grey Goose Vodka to Bacardi in 2004 for a stunning $2 billion.