Chapter 11 BA 370

A product is anything that is of value to a consumer and can be offered through a voluntary marketing exchange.
True
Effective packaging and labels send consumers the signal “Buy me!”
True
A company’s product line consists of its various product mixes.
False
Brands enable customers to quickly differentiate one firm or product from another.
True
Brand equity is calculated by subtracting sales of generic brands from the sales of branded items in a category.
Fasle
The more familiar customers are with a brand, the harder their decision-making process will be.
False
Harold is a loyal Coca-Cola customer. Loyal customers like Harold require lower marketing expenditures, benefiting businesses like Coca-Cola.
True
Private-label brands are imitations often sold by street vendors.
False
For a company like Pepsi-Cola, brand dilution occurs when it sells more product than the competition.
False
In entertainment licensing, the major risk to licensees is that the brand will become overexposed.
False
A product label is just a required sticker on a package.
False
When purchasing a mobile phone, the product you are buying is more than just the phone.
True
A customized carved cedar wood sign for your house is an example of a convenience product.
False
For the average college student, a retirement account would be a shopping product.
False
Kellogg’s sells many different breakfast cereals, including Corn Flakes, Rice Krispies, Frosted Flakes, Raisin Bran, and Special K. This is an example of the breadth of the Kellogg’s product mix.
False
If Microsoft decided to sell mobile phones under the Xbox brand (which it uses for its gaming systems), this would be an example of a line extension.
False
Sales of private-label brands continue to increase, particularly in big-box stores such as Costco and Trader Joe’s.
True
When Jaclyn selects a case of Sprite at the grocery store for her party, she is attracted by the holiday-themed box featuring green and white bells. What Jaclyn is seeing is referred to as the secondary package.
True
Jenny traded in her old car for her heart’s desire, a new Lexus sedan. The Lexus is considered a specialty product.
True
Nike sells shoes, clothing, and athletic gear. These represent the breadth of Nike’s products.
True
A decrease in a company’s product depth will always hurt its marketing efforts.
False
A familiar brand name always helps the sales of a product.
False
Claire always liked Lands’ End raincoats, so when she was shopping for a winter coat, she ordered one from Lands’ End without thinking too much about it. This demonstrates how brands facilitate purchases.
True
Brands are assets that can be legally protected through trademarks.
True
When Mars manufactures M&M’s, Snickers, and other confectionary products, or when Trek designs bicycles, each company’s core question is: How do we produce this product in the least expensive manner?
False
A product is __________ that can be offered through a voluntary marketing exchange.
anything of value to consumers
The complete set of all products offered by a firm is called its
product mix
A __________ is a group of associated items that consumers tend to use together or think of as part of a group of similar products.
product line
For a major university, undergraduate studies, graduate studies, and professional programs would be __________ within the university’s product mix.
product lines
It is almost impossible to watch a sporting event on television without seeing Nike’s “swoosh” check mark, which is Nike’s
symbol
In 2015, Nike signed an 8-year, $1 billion apparel deal with the NBA. This is an example of a deal for _______ rights.
licensing
Zappos is a successful online shoe company. One of the difficulties in running a shoe company is the need to have significant __________, a large number of items in each product line.
product line depth
Marketers with successful brands sometimes hesitate to expand their brands because
it is costly to maintain many product lines, and it might weaken the brand’s meaning.
All of the following scenarios illustrate a reason why a firm would eliminate an item within a product line except
the firm has decided to capture new markets.
For many years, General Electric had a corporate strategy of being among the top three firms in any market in which it operated; if it could not achieve a top-three position, it would exit the market. This strategy often resulted in the company __________ when certain product lines failed to meet this expectation.
decreasing product mix breadth
The decision to delete a product is never taken lightly because, generally, manufacturers
have made substantial investments in product development and manufacturing.
A university that has separate graduate and undergraduate admission offices recognizes that these are distinct
product lines.
One important purpose of a brand is to
increase consumer recognition and awareness of product offerings.
In addition to extensive online and outdoor advertising, Under Armour has intensified its ______ efforts by signing Washington Nationals baseball star Bryce Harper to the biggest endorsement deal for an MLB player.
branding
For a brand name to be effective, it needs to be
easy for consumers to recognize and remember.
One key feature of the value of a strong brand is that
it can protect the firm from competition.
When consumers associate a brand with a certain level of quality and familiar attributes, allowing consumers to make quick decisions, the brand
facilitates purchasing.
Parents of young children have been known to drive out of their way so their kids will not see McDonald’s Golden Arches and plead with their parents to stop. For McDonald’s, the Golden Arches reduce marketing costs because people (including young children)
know what the Golden Arches brand symbol means.
Firms that use the same brand name for new products can spend relatively less on marketing costs for the new product because
people already know what the brand means
The XYZ car manufacturing company is advertising its new hybrid vehicle. It understands that its competition, Toyota’s hybrid car, the Prius, is known for being economical, a good value, stylish, and good for the environment. Toyota has the advantage of
brand associations
When Amanda shops for lipstick, she always buys Really Red by Cover Girl. This is an example of
brand loyalty
The value of a brand is often calculated by assessing the
earning potential of the brand over the next 12 months
Marketing expenditures allocated carefully can result in greater brand recognition, awareness, perceived value, and consumer loyalty for the brand, which all enhance the brand’s
equity
The Doritos advertising effort of “Live Mas,” which is Spanish for “Live More,” is meant to suggest a lifestyle aspiration. If consumers make a connection between the Doritos brand and this promotional effort, then Doritos has created
a brand association.
Firms spend millions of dollars annually to build brand equity, recognizing that brand equity contributes to
profitability
All of the following are included in the main criteria used for determining how “good” a brand is, or how much equity it has except
brand conceptualization
If many consumers in the marketplace are familiar with a brand and what it stands for and have an opinion about the brand, the brand has considerable
awareness
Whether they like them or not, most U.S. automobile customers are familiar with and have an opinion about American-made cars. This familiarity makes it easier for consumers to
make purchase decisions
Sometimes brand names become synonymous with a product itself. If that happens, the brand
could lose its trademark status
In the case of Band-Aid adhesive bandages, the brand name has
become synonymous with the product itself.
Salina is working to create greater brand awareness for her company’s new line of fitness trackers. To increase brand awareness, the least important information that should be included in promotions is
the product history
Why would a firm spend over $2 million for a 30-second ad on television during the Super Bowl?
because the Super Bowl offers an opportunity to create significant brand awareness
Relatively few consumers like to go to the dentist. Dental insurance plans that pay for regular checkups increase the __________ of dental care by reducing the cost to the consumer.
perceived value
In a competitive market, perceived value is determined by consumers mostly
in relation to the value of its close competitors
Nora is deciding whether to purchase brand-name sneakers or a less expensive store brand. She has purchased other shoes with the same brand name in the past but was only marginally satisfied. In this situation, Nora is likely to purchase the store-brand sneakers because they offer
greater perceived value
Matt was passionate about Hollister. It was the only place he’d buy his clothes. If anyone asked him about clothes, he would talk for what seemed like hours about why he only shopped there. From a strictly marketing perspective, this word of mouth is an element of
brand loyalty
Jenna always buys Stacy’s brand pita chips. She does not even consider alternatives. Jenna is a __________ customer.
brand-loyal
All of the following statements regarding brand loyalty are true
the marketing costs of reaching loyal customers are typically very high.
For marketers, one of the benefits of having achieved brand loyalty is
lower marketing costs associated with reaching loyal customers.
For luxury carmakers, the lowest-end models in their product lines often represent only a small portion of their sales. Yet these models are critically important when it comes to attracting new customers and, potentially, establishing their lifelong
loyalty to the brand.
Imagine that you are the marketing manager of a hotel chain that wants to implement a customer reward and loyalty program. You research the firm Sabre Hospitality Solutions, which offers its services to global and boutique hotel chains to develop and execute these types of programs. Sabre Hospitality Solutions is a company that focuses on
customer relationship management.
Frequent buyer/user award programs are used to
maintain contact with loyal customers.
A tablet programmed with key customers’ birthdates, wine preferences, and food allergies is a(n) __________ tool.
CRM
Brands can be owned by
any firm in the supply chain
Adidas, Pepsi, Kitchen-Aid, and Sony are considered famous ________ brands because they are owned and managed by the manufacturer.
national
Which of the following is the best example of a family brand?
Tostitos Multigrain Scoops and Tostitos Chunky Salsa
The basic reason manufacturers spend time and money building their own brands is to
build brand equity
Procter & Gamble is a huge national brand manufacturer. By owning its brands like Tide and Crest, P&G
has greater control over its marketing strategy
Brands that are owned by ___________ are called private-label brands.
retailers
________ is another term for private-label brands.
Store Brands
Private-label brands are developed and managed by
retailers
Consumers might not realize that Old Spice health and wellness products and Iams pet nutrition products are made by the same company—Procter & Gamble. Old Spice and Iams are known as
individual brands
When Procter & Gamble added teeth-whitening products under the Crest brand, the firm was engaged in
brand extension
Why is brand extension a popular marketing strategy?
It allows the firm to spend less on creating brand awareness and associations
All of the following are potential benefits of brand extension except
eliminating competition.
One of the categories of products for which brand extension is especially logical is
complementary goods
Jake developed a toothpaste using only natural ingredients, and he has been quite successful selling the product in health food stores and some grocery stores. He has recently developed a toothbrush using bamboo and natural components. Jake is considering a __________, giving the toothbrush the same brand name as the toothpaste in order to create greater brand awareness.
brand extension
Ferrari is well known as a brand of luxury sports cars; accordingly, it has leveraged its brand name to introduce clothing offerings emblazoned with its horse logo. It has also licensed its logo to 68 different products, from sunglasses to guitars. Ferrari might be at risk of which of the following?
brand dilution
Marco tried a new fruit-flavored beverage and thought it was awful. He was especially disappointed because he had liked the dried fruit snacks marketed under the same brand name. Now he wasn’t sure he even wanted to buy the snacks he had liked before. This highlights a problem in branding known as
brand dilution
Harley Davidson’s cake decorating kit tried to appeal to the brand’s unparalleled consumer loyalty, but it was considered too tame by their consumer base. This is an example of
brand dilution.
A _______ refers to the use of the same brand in a different product line.
brand extension
Marketers with luxury brands use brand extension cautiously in order to avoid
diluting the core brand.
Shell MasterCard, created cooperatively by Shell Oil Company and MasterCard, is an example of
co-branding.
Efforts to change a brand’s focus to target new markets or change the image of a brand are called
brand repositioning.
When Disney flooded retail stores with products based on its movie, this illustrated
brand licensing
Ella had been using an imported brand of shampoo for several years, but she could no longer find it anywhere. As she was considering what kind of shampoo to try, she was surprised to see ads for Procter & Gamble’s Head and Shoulders being promoted as a glamorous health-oriented product. She had always thought of Head & Shoulders as an antidandruff shampoo. The new ads suggest that Head & Shoulders has most likely been
rebranded.
All of the following statements regarding secondary packaging are true except
It is of little value to the average consumer.
A __________ package is the one a consumer uses. A __________ package is used by retailers to display and sell the product.
primary; secondary
All of the following are considered an important function of labels on products and packages except
protecting against damage to the product.
What U.S. government agency has the primary responsibility in reviewing food and package labels to ensure claims made by the manufacturer about the product are true?
Food and Drug Administration
Kendra is taking a backpacking trip across Europe. She wants to make sure that the backpack she chooses is the best one for her adventure, so she is spending a considerable amount of time comparing alternatives to make sure she selects the best one. For Kendra, this backpack represents what type of product?
shopping
Zappos, an online shoe company, knows shoes are typically a(n) __________ good, with consumers often spending time comparing alternatives. It overcomes that aspect of consumers’ search process by offering a free, no-questions-asked return policy.
shopping
Marketers selling milk, bread, and other consumer staples know that most customers do not spend much time searching or comparing alternatives. For most consumers, these are _____________ goods.
convenience
Andy likes gourmet popcorn, and will spend time trying to find his favorite brand. His girlfriend, Joanne, loves popcorn but doesn’t care about brands. For Andy, popcorn is a __________ good while for Joanne it is a __________ good.
specialty; convenience
Marketers need to think about the product offer on three levels. Which of the following levels includes associated services such as warranties, financing, support, and after-sale service?
augmented product
All of the following are considered part of the “actual product” level of the product offer except
product warranty.
When manufacturers try to understand what customers are looking for, they are thinking about the _______ component of the product offer.
core customer value
Suppose that Walgreens (a major drug store chain) wants to introduce its own brand of cough medicine that is similar in contents and packaging to a national brand, but at a lower cost. What kind of brand would Walgreens be introducing?
private-label brand
When a company launches a new product line with an existing brand name, this is known as
a brand extension.
Which of the following brand strategies is being used when the local ice cream shop decides to add a new flavor to its menu?
a line extension
When a restaurant chain, Big Burgers, launches its own brand of frozen meals, this is an example of a
brand extension
Which of the following best describes when Johnson & Johnson introduces a travel-sized package for its existing baby oil product?
line extension
What aspect of the product is being described when a used-car salesperson explains that each car comes with a one-year extended warranty and a two-year maintenance plan?
associated services
Some credit cards provide free liability insurance, funded by the bank issuing the card, when a customer pays for a rental car using the card. This extra insurance is an example of
an associated service
When a salesperson calls you to sell a cemetery plot, this is most likely what type of product?
unsought product
Where on a product’s packaging would one most likely find nutrient content and country of origin?
on the label
Returnable packaging, use of 3D printing, and flexible packaging are examples of
sustainable packaging.
When Kraft’s Philadelphia cream cheese changed its packaging from round to oval to ensure front-facing displays that can’t spin and to fit more into the same shelf space, this was a subtle way in which the firm _________ its product.
repositioned
How did consumers respond when Chobani reduced the size of its Greek yogurt containers by 12 percent?
They used social media to complain about the change.
A toothpaste tube is an example of a ________ package.
primary
When Meg planned her trip to Australia, she spent months evaluating packages, airfares, and hotel accommodations. Meg’s trip is an example of a(n) ________ product.
shopping