18 Questions
What does perceived value refer to in the context of branding?
The value a brand provides in the eyes of consumers
In branding, what are brand associations?
The mental links consumers make between a brand and its key attributes
What does brand awareness measure?
How many consumers are familiar with the brand and what it stands for
How do strong brands impact consumer behavior?
Consumers may consider the brand synonymous with the product itself
What is the primary purpose of branding according to the text?
To help consumers differentiate between products from different companies
How does branding contribute to creating customer value?
By helping customers perceive differences between brands and make informed choices
What is cobranding?
Marketing two or more brands together on the same package or promotion
Which of the following is NOT a consideration for marketers regarding brand extension?
The brand name should be extended to as many products as possible
Why should firms consider distancing the brand extension from the core brand?
To maintain brand equity
How can brand extension potentially dilute brand equity?
By extending the brand name to unrelated products
What is a key factor in ensuring successful brand extension?
Ensuring a fit between the product class of the core brand and the extension
How can consumer perceptions affect brand extension success?
By ensuring consumer perceptions are similar between the core brand and the extension
What is brand dilution and what can cause it?
Brand dilution is when a brand becomes less recognizable due to overexposure. It can be caused by expanding into too many product categories.
What happened to Zippo when they introduced a perfume for women?
Zippo experienced brand dilution because women did not associate lighters with perfume.
What is the risk of a brand extension not fitting well with the core brand?
The risk is that consumers may not perceive the brand extension as part of the core brand.
What should a brand do to avoid brand dilution when extending into new product categories?
The brand should ensure that the core brand and the new extension fit well together.
What is the benefit of a brand extension?
A brand extension allows a brand to diversify its product portfolio.
What should a brand consider when evaluating consumer perceptions of a potential brand extension?
The brand should consider the perceived fit between the core brand and the new extension.
Study Notes
Branding
- The purpose of branding is to help consumers distinguish one company's products from another.
- Branding allows customers to associate a product with a specific company.
Brand Equity
- Brand equity refers to the value of a brand.
- It consists of three components: awareness, perceived value, and brand associations.
Brand Awareness
- Measures how many consumers in a market are familiar with a brand and what it stands for.
- Strong brands can become synonymous with a product.
Perceived Value
- Refers to the value that customers believe a brand offers.
- First Choice Haircutters, a national haircutting chain, provides value to customers through quality haircuts at a reasonable price.
Brand Associations
- Mental links that consumers make between a brand and its key product attributes, such as logos, slogans, or famous personalities.
Cobranding
- The practice of marketing two or more brands together, on the same package or promotion.
Brand Licensing
- A contractual arrangement between firms, where one firm allows another to use its brand name, logo, symbols, and/or characters in exchange for a negotiated fee.
- Example: Porsche licensing its brand name to be used on watches, luggage sets, and tennis racquets.
Brand Extension
- The practice of using a brand name for new products.
- Can be successful, but can also dilute brand equity if not done carefully.
Brand Extension - Negative Consequences
- Too many extensions can result in brand dilution.
- Ensuring the brands can be distanced from one another if needed is crucial.
- Example: Zippo suffered brand dilution when it extended its brand by introducing a perfume for women, which didn't align with the brand's associations.
Evaluating Brand Extension
- Evaluate consumer perceptions of the core brand and the extension.
- Ensure the fit between the product class attributes of the core brand and the extension.
- Refrain from extending the brand name to too many products.
- Consider whether the brand extension can be distanced from the core brand if needed.
Test your knowledge on cobranding and brand licensing with this quiz! Learn about the practice of marketing two or more brands together and contractual arrangements between firms for brand usage. Explore examples like Porsche's appearance on various products and the video game Need for Speed: Porsche Unleashed.
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