Answer to Question 1
Before establishing branding policies, a firm must decide whether to brand its products at all. If a company's product is homogeneous and is similar to competitors' products, it may be difficult to brand in a way that will generate brand loyalty. Raw materials such as coal, sand, and farm produce are hard to brand because of the homogeneity of such products and their physical characteristics. If a firm chooses to brand its products, it may use individual branding, family branding, or a combination.
Individual branding is a policy of naming each product differently. Nestl S.A. is the world's largest food and nutrition company. Nestl uses individual branding for many of its different brands, such as NESCAF coffee, PowerBar nutritional food, Maggi soups, and Haagen-Dazs ice cream. A major advantage of individual branding is that if an organization introduces an inferior product, the negative images associated with it do not contaminate the company's other products. An individual branding policy also may facilitate market segmentation when a firm wishes to enter many segments of the same market. Separate, unrelated names can be used, and each brand can be aimed at a specific segment.
When using family branding, all of a firm's products are branded with the same name or at least part of the name, such as Kellogg's Frosted Flakes, Kellogg's Rice Krispies, and Kellogg's Corn Flakes. In some cases, a company's name is combined with other words to brand items. Arm & Hammer uses its name on all its products, along with a general description of the item, such as Arm & Hammer Heavy Duty Detergent, Arm & Hammer Pure Baking Soda, and Arm & Hammer Carpet Deodorizer. Unlike individual branding, family branding means that the promotion of one item with the family brand promotes the firm's other products.
Answer to Question 2
C