Why is it difficult to gain agreement on a suitable system for measuring marcom performance?

The Concept of Brand Equity: Brand: represents a "name, term, sign, symbol, or design, or a combination of them intended to identify the goods and services of one sellers and to differentiate them from those of competition". A brand is everything that one compnay's particular offering stands for in comparison to other brands in a category of competitive products. Brand represents a set of values that its marketers, senior compnay officials, and other employees consistently embrace and communicate for extended period. A Firm-Based Perspective on Brand Equity The firm-based viewpoint of brand equity focuses on outcomes extending from efforts to enhance a brand's value to its various stakeholders. As the value of a brand increases, positive outcomes result. - achieving a higher market share -increasing brand loyalty - being able to change premium prices - earning a revenue premiuim Revenue Premium: the revenue differential between a branded item and a corresponding private labeled item. A Customer-Based Perspective on Brand Equity Brand equity from the customer's perspective consists of two forms of brand-related knowledge: brand awareness and brand image. Brand Awareness Brand awareness is an issue of whether a brand name comes to mind when consumers think about a particular product category and the ease with which the name is evoked. Brand awareness is the basic dimension of brand equity. Brand recognition reflects a relatively superficial level of awareness, whereas brand recall indicates a deeper from of awarenes. Although building brand awareness is a necessary step toward brand equity enhancement, it is insufficient. Brand Image The second dimension of consumer-based brand knowlmedge is a brand's image. Brand image can be thought of in terms of the types of associations that come to the customer's mind when contemplating a particular brand. An association is simply the particular thoughts and feelings that a consumer has about a brand, much in the same fashion that we have thoughts and feelings about other people. 1. Sincerity: Includes brand that are down-to-earth, honest, wholesome, and cheerful. 2. Excitement: Brands scoring high on the excitement dimension are percieved as daring, spirited, imaginative, and up-to-date. 3.Competence: Brands scoring high on this personality dimension are considered reliable, intelligent, and successful. 4. Sophistication: Brands that are considered upper class and charming score high on the sophistication dimension. 5. Ruggedness: Rugged brands are thought of as tough and outdoorsy. How Can Brand Equity Be Enhanced? In general, efforts to enhance a brand's equity are accomplished through the initial choice of positive brand identity but mostly through marketing and marcom programs. A favorable brand image does not happen automatically. Sustained marketing communications are generally required to create favorable, strong, and unique associations. Ingredient branding is a special type of alliance between branding partners. What Benefits Results from Engancing Brand Equity? One major by-product of efforts to increase a brand's equity is that consumer brand loyalty might also increase. Research has shown that when firms communicate unique and positive messages via advertising, personal selling, promotions, events, and other means, they are able to differintiate their brands effectively from competetive offerings and insulate themselves from future price competition. Characteristics of World-Class Brands 1. Brand excels at delivering the benefits customers truly desire. 2. The brand stays relevant 3. The pricing system is based on consumers' perceptions of value 4. Th brand is properly positioned. 5. The brand is consistent 6. The brand portfolio and hierarchy make sense 7. The brand makes uses of and coordinates a full repertoire of marketing activities to build equity. 8. The brand's managers understand what the brand means to consumers. 9. The brand is given proper support, and the support is sustained over the long run. 10. The company monitors sources of brand equity. Affects Behavior and Achieving Marcom Accountability Marcom's eventual challenge is to influence behavior, whatever the nature of that bevior might be. The effect of marcom, or of ots specific elements such as advertising, can thus be gauged in terms of whether it generates a reasonable revenue returns on the marcom investment. Difficulty of Measuring Marcom Effectiveness Though most marketing executives agree that measuring marketing performance is critically important, at the present time relatively few organizations are doing a sophisticated job. Choosing a Metric An initial problem is one determining which specific measures should be used to judge marcom effectiveness. The difficulty of determining how best to measure marketing's return on investment is illustrayed by a recent study conducted of its membership by the(ANA). Gaining Agreement As generally is the case when intelligent people representing different organizational interests are asked to settle in on a particular solution to a problem. Collecting Accurate Data Whatever the measure chosen, any effort to meaningfully assess marcom performance necessitates having data that are reliable abd valid. Calibrating Specific Effects Our hypothetical automobile company will employ several marcom tools to "move" automobiles to consumers. Assessing Effects with Marketing-Mix Modeling To understand and appreciate the nature and role of marketing-mix modeling le's return to the exmaple of the automobile. In order to emplot marketing-mix modeling, a relatively long series of longitudinal data- say, for a two -year period- is required. Marketing-mix modeling is widely used by consumer package good companies.

Chapter 2—Enhancing Brand Equity and AccountabilityTRUE/FALSE1. A brand is a name, term, sign, symbol, or design, or a combination of them, intended to identify thegoods and services of one seller or groups of sellers and to differentiate them from those ofcompetition.ANS: TPTS: 12. All organizations and their products can be considered brands.ANS: TPTS: 13. The concept of brand equity is considered only from the perspective of the customer.ANS: FPTS: 14. Brand equity occurs when the consumer considers two competing brands to be similar.ANS: FPTS: 15. A firm-based viewpoint of brand equity focuses on outcomes extending from efforts to enhance abrand’s value to is various stakeholders.ANS: TPTS: 16. Revenue premium is defined as the revenue differential between a branded item and a correspondingprivate labeled brand.ANS: TPTS: 17. Many private-label products possess levels of quality that are equivalent to manufacturers’ nationalbrands.ANS: TPTS: 18. From the perspective of the customer, brand preference is the basic dimension of brand equity.ANS: FPTS: 19. Brand equity from the customer’s perspective consists of two forms of brand-related knowledge:brand awareness and brand image.ANS: TPTS: 110. Brand image is an issue of whether a brand name comes to mind when consumers think about aparticular product category and the ease with which the name is evoked.ANS: FPTS: 111. A brand has no equity if consumers are unfamiliar with it.ANS: TPTS: 112. Brand recall reflects a relatively superficial level of awareness, whereas brand recognition indicates adeeper form of awareness.ANS: FPTS: 113. The marcom imperative is to move brands from a state of unawareness, to recognition, on to recall,and ultimately to top-of-mind awareness (TOMA).ANS: TPTS: 114. Brand image can be thought of in terms of the types of associations that come to the customer’s orconsumer’s mind when contemplating a particular brand.ANS: TPTS: 115. Brand associations can be conceptualized in terms of type, favorability, strength, and uniqueness.ANS: TPTS: 116. Research has identified ten personality dimensions that describe most brands.ANS: FPTS: 117. Brands scoring high on the sincerity dimension are considered reliable, intelligent, and successful.ANS: FPTS: 118. The objective of marketing communication is to deemphasize brand equity.ANS: FPTS: 119. By trying and using brands, consumers learn how good (or bad) they are and what benefits they are(in)capable of delivering, which is known as the leveraging approach to enhancing brand equity.ANS: FPTS: 120. Marketing communicators draw meaning from the culturally constituted world and transfer thatmeaning to consumer goods.ANS: TPTS: 121. A brand can leverage associations by connecting itself with other brands, places, things, and people.ANS: TPTS: 122. Co-branding occurs when two or more brands enter into a partnership that potentially serves toenhance both brands’ equity and profitability.ANS: TPTS: 123. A potential downside for the host brand with respect to ingredient branding is that the equity of theingredient brand might be so great that it overshadows the host brand.ANS: TPTS: 124. One major by-product of efforts to increase a brand’s equity is that consumer brand loyalty might alsoincrease, which in turn, could positively influence long-term growth and profitability.ANS: TPTS: 125. The EquiTrend survey asks respondents to rate a number of brands in terms of two dimensions: qualityand salience.ANS: TPTS: 126. Successful brands employ just one or two marcom tools in order to satisfy the brand’s positioningstrategy.ANS: FPTS: 127. One trait shared by the world’s strongest brands is that the company monitors sources of brand equitythrough ongoing brand audits or tracking studies.ANS: TPTS: 128. Enhancing brand equity is a means of moving customers to favorable action toward the brand.ANS: TPTS: 129. The vast majority of marketing executives and marketing academics are against gauging the effect ofmarcom efforts in terms of the return on marketing investment, or ROMI, because it is almostimpossible to measure.ANS: FPTS: 130. Measuring marcom effectiveness is relatively simple, and most organizations are currently doing asophisticated job of doing so.ANS: FPTS: 131. One difficulty with measuring marcom effectiveness is the identification of an appropriate measure, ormetric, of effectiveness.ANS: TPTS: 132. Whatever the measure chosen, any effort to meaningfully assess marcom performance requires havingdata that are reliable and valid.ANS: TPTS: 133. A technique called promotion-mix modeling is increasingly being used to determine the relative effecteach marcom program element has on sales volume compared to the effects of other elements.ANS: FPTS: 134. Marketing-mix modeling employs multivariate regression analysis to estimate the effects that thevarious advertising and promotion elements have in driving sales volume.ANS: TPTS: 135. To employ marketing-mix modeling, a relatively long series of longitudinal data (i.e., two-year period)is required.ANS: TPTS: 1MULTIPLE CHOICE1. A _____ is a name, term, sign, symbol, or design, or a combination of them intended to identify thegoods and services of one seller or group of sellers to differentiate them from those of competition.a. trademarkb. marketc. tradenamed. brande. guaranteeANS: DPTS: 12. A _____ is everything that one company’s particular offering stands for in comparison to competitors’offerings.a. trademarkb. logoc. symbold. brande. signANS: DPTS: 13. The concept of brand equity is considered from which perspective?a. from the perspective of the organization that owns the brandb. from the vantage point of the customerc. from the perspective of the other brands in the product categoryd. a and b onlye. a, b, and cANS: DPTS: 14. From the perspective of the firm that owns the brand, which of the following is a positive outcome ofincreased brand equity?a. higher market shareb. increased brand loyaltyc. ability to charge premium pricesd. earning a revenue premiume. All of these are correct.ANS: EPTS: 15. As a brand’s equity increases, its elasticity of demand _____.a. becomes less elasticb.c.d.e.becomes more elasticbecomes less inelasticremains constantincreasesANS: APTS: 16. The revenue differential between a branded item and a corresponding private labeled item is known as_____.a. market premiumb. price premiumc. revenue premiumd. profit premiume. equity premiumANS: CPTS: 17. Tide laundry detergent is a well known brand that sells for approximately $8.00 for a 64 ounce bottle,and Procter & Gamble usually sells 2 million of these sizes each year. An average private label storebrand costs $6.00 for the same size, and typically 1 million are sold each year. What is Tide’s revenuepremium?a. $2.00b. $1 millionc. $6 milliond. $10 millione. $16 millionANS: DPTS: 18. A research study involving McDonald’s products discovered a new form of firm-based brand equitythat has been labeled _____ brand equity.a. name-recognitionb. taste-premiumc. market-shared. revenue-premiume. price-premiumANS: BPTS: 19. From the perspective of the customer or consumer, _____ is the extent to which they are familiar withthe brand and have stored in their memory favorable, strong, and unique brand associations.a. brand awarenessb. brand imagec. brand preferenced. brand equitye. brand effectivenessANS: DPTS: 110. Brand equity from the customer’s perspective consists of _____.a. brand awareness and brand imageb. brand awareness and brand preferencec. brand image and brand insistenced. brand image and brand tolerancee. brand awareness and brand toleranceANS: APTS: 111. _____ refers to the extent to which a brand name comes to mind when consumers think about aparticular product category and the ease with which the name is evoked.a. Brand imageb. Brand awarenessc. Brand loyaltyd. Brand preferencee. Brand knowledgeANS: BPTS: 112. The basic dimension of brand equity is _____.a. brand imageb. brand preferencec. brand toleranced. brand insistencee. brand awarenessANS: EPTS: 113. What is the initial challenge for new brands?a. achieving brand awarenessb. enhancing brand imagec. achieving brand preferenced. achieving brand insistencee. building revenue premiumANS: APTS: 114. Brand _____ reflects a relatively superficial level of awareness, whereas brand _____ indicates adeeper form of awareness.a. image; equityb. equity; imagec. recognition; recalld. recall; recognitione. associations; imageANS: CPTS: 115. Bill is given a list of brands of shaving products by a researcher and is asked to mark all those that heis aware of. Which level of awareness is this assessing?a. recallb. recognitionc. aided recalld. unaided recalle. positive awarenessANS: BPTS: 116. Maria is asked by a market researcher to list all the brands of toothpaste she can think of. Which typeof awareness is this assessing?a. recallb. recognitionc. positive awarenessd. free-association awarenesse. aided recognitionANS: APTS: 117. The pinnacle of brand-name awareness that exists when your company’s brand is the first brand thatconsumers recall when thinking about brands in a particular product category is known as _____.a. top-of-category awareness (TOCA)b. recognitionc. tip-of-the-tongue awareness (TOTA)d. top-of-mind awareness (TOMA)e. top-of-class awareness (TOCA)ANS: DPTS: 118. Which of the following statements is true regarding brand awareness?a. Only consumer-oriented (B2C) firms must be concerned with building brand awareness.b. Most consumers are able to retrieve a brand name from memory without any reminders.c. There are two levels of brand awareness: primary and secondary.d. Brand recall reflects a relatively superficial level of awareness, whereas brand recognitionindicates a deeper form of awareness.e. Although building brand awareness is a necessary step toward brand equity enhancement,it is insufficient.ANS: EPTS: 119. The types of associations that come to the consumer’s mind when contemplating a particular brand isknown as _____.a. brand imageb. brand equityc. brand awarenessd. brand cognitionse. brand parityANS: APTS: 120. Maria is asked by a market researcher to tell him the particular thoughts and feelings she has aboutStarbuck’s coffee. A particular thought or feeling that comes to Maria’s mind is known as a(n) _____.a. brand dimensionb. cognitionc. brand linkd. associatione. think-feel linkageANS: DPTS: 121. Brand associations can be conceptualized in terms of _____.a. typeb. favorabilityc. strengthd. uniquenesse. All of these are correct.ANS: EPTS: 122. Research has identified _____ dimensions that seem to capture the personalities of a variety ofconsumer brands.a. fourb. fivec. sixd. sevene. eightANS: BPTS: 123. Which of the following is NOT a personality dimension that describes most brands?a. sincerityb. excitementc. competenced. innocencee. ruggednessANS: BPTS: 124. This dimension includes brands that are down-to-earth, honest, wholesome, and cheerful.a. excitementb. sophisticationc. competenced. sinceritye. ruggednessANS: DPTS: 125. Toyota automobiles are regarded by consumers as reliable, intelligent, and successful. The levels ofsatisfaction of Toyota owners is at or near the top of satisfaction ratings. Which brand-relatedpersonality dimension best describes Toyota?a. excitementb. competencec. sophisticationd. ruggednesse. innocenceANS: BPTS: 126. Luxury items, such as Rolex watches, generally score high on which brand-related personalitydimension?a. Sincerityb. Excitementc. Competenced. Sophisticatione. RuggednessANS: DPTS: 127. Which personality dimension has General Motors attempted to create for its repair services through itshypothetical “Mr. Goodwrench,” who represents the name and “face” of the trained technicians whowork in thousands of GM dealerships?a. sincerityb. excitementc. competenced. sophisticatione. ruggednessANS: APTS: 128. What is necessary to create favorable, strong, and unique associations about a brand?a. heavy mass media advertisingb. co-brandingc. sustained marketing communicationsd. ingredient-brandinge. brand preferenceANS: CPTS: 129. Which of the following is NOT an approach by which brand equity is enhanced?a. brand awareness approachb. speak-for-itself approachc. message-driven approachd. leveraging approache. All of these are approaches.ANS: APTS: 130. Consumers learn how good (or bad) a brand is and what benefits it is (in)capable to delivering bytrying and using a brand. Which approach to enhancing brand equity is this known as?a. message-driven approachb. leveraging approachc. trial-and-error approachd. speak-for-itself approache. initial approachANS: DPTS: 131. In which approach to enhancing brand equity do marcom practitioners attempt to build advantageousassociations through creative, attention getting, and believable messages?a. speak-for-itself approachb. message-driven approachc. leveraging approachd. shotgun approache. cast-a-wide-net approachANS: BPTS: 132. Brand associations can be shaped and equity enhanced through marketing communications thatassociate the brand with people, places, and “things” that are available to consumers. This approach isknown as the _____.a. speak-for-itself approachb. message-driven approachc. leveraging approachd. culturally constituted approache. meaning transfer approachANS: CPTS: 133. People learn cultural values, form beliefs, and become familiar with the physical manifestations, orartifacts, of these values and beliefs through _____.a.b.c.d.e.marcommedia exposuresocializationbrand awarenessactive synthesisANS: CPTS: 134. When a marketing communicator connects a consumer good with a representation of the culturallyconstituted world, s/he is engaging in _____.a. lifestyle marketingb. sales promotionc. socializationd. point-of-purchase advertisinge. meaning transferANS: EPTS: 135. Marketing communicators _____ meaning and create associations for their brands by connecting themwith other objects that already possess well-known meaning.a. promoteb. locatec. leveraged. advertisee. obtainANS: CPTS: 136. Which marcom tool is an especially important instrument of meaning transfer?a. sales promotionb. personal sellingc. advertisingd. public relationse. frequency programsANS: CPTS: 137. Lee Michaels is a national chain jewelry store found in many malls across the U.S. Laurie went in tolook at the watches, but she was unfamiliar with some of the brands. The salesperson told her that theywere all Swiss-made, meaning they were made in Switzerland, which is known worldwide for thequality of the timepieces produced there. From which source are these brands leveraging their brandmeaning?a. other brandsb. peoplec. placesd. thingse. namesANS: CPTS: 138. Which of the following is a source by which brand meaning can be leveraged?a. other brandsb. placesc. thingsd. peoplee. All of these are correct.ANS: EPTS: 139. When two or more brands enter into a partnership that potentially serves to enhance both brands’equity and profitability, _____ has occurred.a. cross-brandingb. co-brandingc. multi-brandingd. family-brandinge. house-brandingANS: BPTS: 140. Kellogg’s, a cereal manufacturer, and Disney and Pixar have partnered in brands of cereal targeted tochildren that are named after their movies, such as Finding Nemo and The Incredibles. What is thisalliance known as?a. cross-brandingb. ingredient brandingc. family-brandingd. co-brandinge. multi-brandingANS: DPTS: 141. The most important requirement for co-branding is that _____.a. there is a logical fit between the two brandsb. the two brands are similar in pricec. the two products are not directly competing against each otherd. the two products have the same target markete. the two products are manufactured by the same firmANS: APTS: 142. An example of _____ is the sticker on a Dell computer that says “Intel Inside.”a. cross-brandingb. multi-brandingc. reference brandingd. ingredient brandinge. planned brandingANS: DPTS: 143. The EquiTrend survey asks respondents to rate a number of brands in terms of which two dimensions?a. quality and personalityb. awareness and imagec. familiarity and qualityd. image and qualitye. image and preferenceANS: CPTS: 144. Creating and increasing brand loyalty results in a corresponding increase in the value of the _____.a. firmb. target marketc. product positiond. market sharee. trustmarkANS: EPTS: 145. Which of the following is NOT a trait shared by the world’s strongest brands?a. The brand excels at delivering the benefits customers truly desire.b. The brand stays relevant.c. The pricing system is based on consumers’ perceptions of value.d. The brand relies on mass media advertising to satisfy the brand’s positioning strategy.e. The brand portfolio and hierarchy make sense.ANS: DPTS: 146. One trait shared by the world’s strongest brands is that the brand’s managers understand what thebrand means to _____.a. the news mediab. competitorsc. customersd. theme. stock analystsANS: CPTS: 147. The objective of marketing communications is to enhance brand equity as a means of _____.a. defining the marketing mixb. moving customers to favorable action toward the brandc. increasing short-term salesd. reducing the advertising budgete. reducing the promotional budgetANS: BPTS: 148. From the marketer’s standpoint, marcom’s objective is to ultimately affect _____.a. brand equityb. brand awarenessc. brand imaged. sales volume and revenuee. investmentANS: DPTS: 149. The effect of marcom, or of its specific elements such as advertising, can be gauged in terms ofwhether it generates a reasonable _____.a. return on marketing investment (ROMI)b. return on customer investment (ROCI)c. return on equity investment (ROEI)d. return on brand investment (ROBI)e. return on sales investment (ROSI)ANS: APTS: 150. Which of the following is a motivation underlying the increased focus on measuring marketingperformance?a. greater demands for accountability on the marketing function from the CEO, the Board,and other executivesb.c.d.e.the imperative for the CMO to get better at what they dorequired by the IRS to report the gains from marketing investmenta and b onlya, b, and cANS: DPTS: 151. Which of the following is NOT a reason for the difficulty in measuring marcom effectiveness?a. lack of ability by marcom practitionersb. obstacles in identifying an appropriate measure, or metric, of effectivenessc. complications with getting people throughout the organization to agree that a particularmeasure is the most appropriated. snags with gathering accurate data to assess effectivenesse. problems with determining the exact effect that specific marcom elements have on themeasure that has been selected to indicate effectivenessANS: APTS: 152. Specific measures that are used to judge marcom effectiveness are also called _____.a. variablesb. metricsc. coefficientsd. modelse. variancesANS: BPTS: 153. Harold is trying to determine the appropriate metric his company should use to gauge the effectivenessof its marcom efforts. Which of the following is a possible option?a. brand awarenessb. attitudes toward the brandc. purchase intentionsd. sales volumee. All of these are correct.ANS: EPTS: 154. A recent study by the Association of National Advertisers found that among the most common metricsused for measuring ROMI was _____.a. change in consumer purchase behaviorb. incremental sales revenue generated by marketing activitiesc. increases in S-O-M compared to changes in S-O-Vd. changes in brand loyalty generated by advertisinge. changes in brand image with increased expenditure on sales promotionANS: BPTS: 155. Why is it difficult to gain agreement on a suitable system for measuring marcom performance?a. People are uncooperative.b. People in other disciplines do not understand marketing and marketing communicationsc. Individuals from different backgrounds and with varied organizational interests often seethe “world” differently or operate with varying ideas of what best indicates suitableperformance.d. There is so little difference among the measures that it is difficult for individuals outsideof marketing to understand them.e. If it isn’t in terms of dollars, others in the organization don’t even want to look at it.ANS: CPTS: 156. Whatever the measure chosen, any effort to meaningfully assess marcom performance necessitateshaving data that are _____.a. short-term and long-termb. communication-based and sales-basedc. representative and normald. normal and bi-modale. reliable and validANS: EPTS: 157. What is the most complicated problem of all when assessing marcom performance?a. How much data is necessary?b. How much relative effect does each program element have compared to the effects ofother elements?c. How does one assess reliability and validity?d. How can a researcher be sure that the data are appropriate for the metric being assessed?e. How does one account for sampling and measurement errors?ANS: BPTS: 158. Which technique is increasingly being used to assess the relative effect each program element hascompared to the effects of other elements?a. marketing-mix modelingb. structural equation modelingc. marketing optimization modelingd. multidimensional scalinge. calibration modelingANS: APTS: 159. Marketing-mix modeling typically employs which statistical technique to estimate the effects that thevarious marcom elements have in driving sales volume?a. cluster analysisb. structural equation modelingc. multivariate regression analysisd. ANOVAe. MANOVAANS: CPTS: 160. Sam is tasked with employing marketing-mix modeling to determine the effectiveness of variousmarcom elements in affecting sales volume. What will Sam need to conduct this analysis?a. at least five observations for each element assessed along with the level of sales for thosetime periodsb. a relatively long series of longitudinal data, such as two years, indicating the level of salesduring that period along with corresponding marcom expenditures for each programelementc. at least ten observations for each element assessed along with the level of sales for thosetime periodsd. over 1,000 observations for each element assessed along with the level of sales for thosetime periodse. parameter estimates of the individual effects the various marcom elements have on salesANS: BPTS: 161. Which of the following statements is FALSE regarding marketing-mix modeling?a. In order to employ marketing-mix modeling, a relatively long series of longitudinal data(i.e., for a two-year period) is required.b. Marketing-mix modeling employs well known statistical techniques (e.g., multivariateregression analysis) to estimate the effects that the various marcom elements have indriving sales volume.c. Parameter estimates indicate the individual effects the various marcom elements have onsales.d. Managers learn from such analysis which elements are outperforming others and can usethis information to shift budgets from program element to element.e. Once the model is estimated, results can be generalized to other situations.ANS: EPTS: 162. Managers learn from the analytic aspect of marketing mix modeling which marcom elements areoutperforming others and can then use this statistical information to _____.a. shift budgets from program element to elementb. reposition products to better meet the needs of consumersc. develop new products and servicesd. construct more appropriate messages for their target markete. identify new markets for their products and/or servicesANS: APTS: 163. In using marketing-mix modeling, the finer, or more disaggregated, the data the better the analysis canbe in determining which specific marketing mix elements are most and least effective in _____.a. generating awarenessb. creating brand loyaltyc. developing new marketsd. reaching the current target markete. driving salesANS: EPTS: 1ESSAY1. Discuss the benefits of brand equity from the firm’s perspective.ANS:The firm-based viewpoint of brand equity focuses on outcomes extending from efforts to enhance abrand’s value to its various stakeholders. As the value, or equity, of a brand increases, various positiveoutcomes result:1. Achieving a higher market share.2. Increasing brand loyalty.3. Being able to charge premium prices. A brand’s elasticity of demand becomes lesselastic as its equity increases.4. Earning a revenue premium, which is defined as the revenue differential between abranded item and a corresponding private labeled item. With revenue equaling theproduct of a brand’s net price  volume, a branded good enjoys a revenue premium overa corresponding private labeled item to the degree it can charge a higher price and/orgenerate greater sales volume.PTS: 12. Name and describe the two forms of brand knowledge from a consumer perspective.ANS:Brand equity from the customer’s perspective consists of two forms of brand-related knowledge:1. Brand awareness, which is an issue of whether a brand name comes to mind whenconsumers think about a particular product category and the ease with which the name isevoked. It is the basic dimension of brand equity. From the vantage point of anindividual consumer, a brand has no equity unless the consumer is at least aware of thebrand. The two levels of awareness are brand recognition and recall. Brand recognitionreflects a relatively superficial level of awareness, whereas brand recall indicates adeeper form of awareness. The marcom imperative is to move brands from a state ofunawareness, to recognition, on to recall, and ultimately to top-of-mind awareness(TOMA). This pinnacle of brand-name awareness (i.e., TOMA status) exists when yourcompany’s brand is the first that consumers recall when thinking about brands in aparticular product category. Although building brand awareness is a necessary steptoward brand equity enhancement, it is insufficient.2. Brand image can be thought of in terms of the types of associations that come to thecustomer’s or consumer’s mind when contemplating a particular brand. An associationis simply the particular thoughts and feelings that a consumer has about a brand. Theseassociations can be conceptualized in terms of type, favorability, strength, anduniqueness. Research has identified five personality dimensions that describe mostbrands: sincerity, excitement, competence, sophistication, and ruggedness.PTS: 13. Briefly discuss the five dimensions of brand personality.ANS:The five dimensions of brand personality are:1. Sincerity. This dimension includes brands that are down-to-earth, honest, wholesome,and cheerful.2. Excitement. Brands scoring high on the excitement dimension are perceived as daring,spirited, imaginative, and up-to-date.3. Competence. Brands scoring high on this personality dimension are considered reliable,intelligent, and successful.4. Sophistication. Brands that are considered upper class and charming score high on thesophistication dimension.5. Ruggedness. Rugged brands are thought of as tough and outdoorsy.PTS: 14. Name and describe the three ways by which brand equity is enhanced.ANS:The three ways by which brand equity is enhanced are:1. Speak-for-itself approach. With this approach, favorable (or perhaps unfavorable)associations are built merely by allowing the brand to “speak for itself.” That is, bytrying and using brands, consumers learn how good (or bad) they are and what benefitsthey are (in)capable of delivering.2.3.Message-driven approach. Marcom practitioners in their various capacities can build (orattempt to build) advantageous associations via the dint of repeated claims about thefeatures a brand possesses and/or the benefits it delivers.Leveraging approach. Brand associations can be shaped and equity enhanced byleveraging positive associations already contained in the world of people, places, andthings, even other brands, that are available to consumers. The culture and socialsystems in which marketing communications takes place are loaded with meaning.Marketing communicators draw meaning from the culturally constituted world andtransfer that meaning to consumer goods, and advertising is an especially importantinstrument of meaning transfer.PTS: 15. Discuss the reasons accounting for the difficulty in measuring marcom effectiveness.ANS:Several reasons account for the difficulty in measuring marcom effectiveness:1. Choosing a metric. An initial problem is one of determining which specific measures(also called metrics) should be used to judge marcom effectiveness. Possible optionsinclude brand awareness, attitudes toward the brand, purchase intentions, and salesvolume. There typically is no magic bullet by which marcom effectiveness can bejudged unambiguously and perfectly. All measures/metrics are flawed in some way.2. Gaining agreement. There generally is no consensus. This is not because people arenecessarily uncooperative; rather, individuals from different backgrounds and withvaried organizational interests often see the “world” differently or operate with varyingideas of what best indicates suitable performance.3. Collecting accurate data. Whatever the measure chosen, any effort to meaningfullyassess marcom performance necessitates having data that are reliable and valid.4. Calibrating specific effects. Ultimately, brand managers and other marketing executivesare interested in knowing more than just how effective the overall marcom program was.They also need to identify the relative effectiveness of individual program elements sothat even better decisions can be made in the future as to how best to allocate resources.PTS: 1