Brand Management Test 2 - Chap 11

A [blank_start]brand portfolio[blank_end] includes all brands sold by a company in a product category

A portfolio is too [blank_start]big[blank_end] if profits can be increased by dropping brands; it is not big enough if profits can be [blank_start]increased[blank_end] by adding brands.

The basic principle in designing a brand portfolio is to [blank_start]maximize market coverage[blank_end] so that no potential customers are being ignored, but [blank_start]minimize brand overlap[blank_end] so that brands aren’t competing among themselves to gain the same customer’s approval.

The purpose of [blank_start]flanker[blank_end] brands typically is to create stronger [blank_start]points-of-parity[blank_end] with competitors’ brands so that more important (and more profitable) flagship brands can retain their desired positioning.

Many firms are introducing [blank_start]discount[blank_end] brands as flankers, to better compete with store brands and private labels and to protect their higher-priced brand companions.

In designing [blank_start]fighter brands[blank_end], marketers walk a fine line. [blank_start]Fighters[blank_end] must not be so attractive that they take sales away from their higher-priced comparison brands or referents.

Some brands may be kept around despite dwindling sales because they still manage to hold on to a sufficient number of customers and maintain their profitability with virtually no marketing support. Marketers can effectively milk these “[blank_start]cash cows[blank_end]” by capitalizing on their reservoir of existing brand equity.

The role of a relatively [blank_start]low-priced[blank_end] brand in the brand portfolio often may be to attract customers to the brand franchise. Retailers like to feature these traffic builders because they often are able to “trade up” customers to a higher-priced brand. The role of a relatively [blank_start]high-priced[blank_end] brand in the brand family is often to add prestige and credibility to the entire portfolio.

A [blank_start]brand hierarchy[blank_end] is a useful means of graphically portraying a firm’s branding strategy by displaying the number and nature of common and distinctive brand elements across the firm’s products, revealing their explicit ordering.

How many levels of brand hierarchy are there?

Levels of Brand Hierarchy: 1. [blank_start]Corporate[blank_end] or [blank_start]Company[blank_end] brand 2. [blank_start]Family brand[blank_end] - [blank_start]range[blank_end] brand, [blank_start]umbrella[blank_end] brand 3. Individual brand 4. [blank_start]Modifier[blank_end] 5. Product [blank_start]description[blank_end]

What is the highest level of brand hierarchy?

A [blank_start]modifier[blank_end] is a means to designate a specific item or model type or a particular version or configuration of the product.

Adding a modifier often can signal refinements or [blank_start]differences[blank_end] between brands related to factors such as [blank_start]quality[blank_end] levels, attributes, function, and so forth.

A [blank_start]flagship product[blank_end] is one that best represents or embodies the brand to consumers.

Principle of growth: invest in [blank_start]market penetration[blank_end] or [blank_start]expansion[blank_end] vs. [blank_start]product development[blank_end].

[blank_start]Principle of survival[blank_end]: brand extensions must achieve brand equity in their categories.

[blank_start]Principle of synergy[blank_end]: brand extensions should enhance the equity of the parent brand.

[blank_start]Principle of simplicity[blank_end]: employ as few levels as possible.

[blank_start]Corporate brand equity[blank_end] is the differential response by consumers, customers, employees, other firms, or any relevant constituency to the words, actions, communications, products, or services provided by an identified corporate brand entity.

[blank_start]Product Line[blank_end]: - A group of products within a product category that are closely related. - They function in a similar manner. - Sold to the same customer groups. - Marketed through the same type of outlets or fall within given price ranges. - Composed of different brands or a single family brand or individual brand that has been line- extended.

[blank_start]Product mix[blank_end] (or [blank_start]product assortment[blank_end]): the set of all product lines and items that a particular seller makes available to buyers

[blank_start]Brand mix[blank_end] (or [blank_start]brand assortment[blank_end]): the set of all brand lines that a particular seller makes available to buyers.

The role of brand architecture is twofold: 1. To [blank_start]clarify brand awareness[blank_end]: improve consumer understanding and communicate similarity and differences between individual products and services. 2. To [blank_start]improve brand image[blank_end]: maximize transfer of equity between the brand and individual products and services to improve trial and repeat purchase.

The [blank_start]brand-product matrix[blank_end] is a graphical representation of all the brands and products sold by the firm.

The matrix (or grid) has the firm’s [blank_start]brands[blank_end] as rows and the corresponding [blank_start]products[blank_end] as columns.

Why might a firm have multiple brands in the same product category? - To [blank_start]maximize market coverage[blank_end] - Firms introduce multiple brands because no one brand is viewed equally favorably by all the different distinct market segments the firm would like to target - Multiple brands allow a firm to pursue different [blank_start]price[blank_end] segments, different channels of distribution, different geographic boundaries, and so forth - To increase [blank_start]shelf presence[blank_end] and [blank_start]retailer dependence[blank_end] in store - To attract consumers seeking [blank_start]variety[blank_end] who may otherwise switch to another brand - To increase [blank_start]internal[blank_end] competition within the firm - To [blank_start]yield economies of scale[blank_end] in advertising, sales, merchandising, and physical distribution