What is brand equity, and what are the major elements that ...

[mydiamond]

What is brand equity, and what are the major elements that underlie brand equity?

Question 2

Isabella is a product manager for The Container Store, a retailer of plastic bins and other storage containers. Sales have been declining in the past nine months and her management team is pressuring her to compete based on price discounts. However, Isabella is aware of the dangers associated with engaging in price competition. She knows that competitors can also change prices quickly and aggressively, which can result in a(n) ____ that will be harmful to both companies.
 A) reduction in cost
  B) price war
  C) competitive game
  D) industry collapse
  E) advertising battle

[kthug]

Answer to Question 1

A well-managed brand is an asset to an organization. The value of this asset is often referred to as brand equity. Brand equity is the marketing and financial value associated with a brand's strength in a market. Besides the actual proprietary brand assets, such as patents and trademarks, four major elements underlie brand equity: brand name awareness, brand loyalty, perceived brand quality, and brand associations.
Being aware of a brand leads to brand familiarity, which in turn results in a level of comfort with the brand. A familiar brand is more likely to be selected than an unfamiliar brand because the familiar brand often is viewed as more reliable and of more acceptable quality. The familiar brand is likely to be in a customer's consideration set, whereas the unfamiliar brand is not.

Answer to Question 2

B

[mydiamond]

Thanks for the timely response, appreciate it

[AngeliqueG]

Excellent