CBM Brand Equity Measurement 2 — Questions and Answers
Question 1: Which metric best captures the price premium a brand commands over a generic equivalent?
- Net Promoter Score
- Price premium index (Correct answer)
- Brand recall rate
- Share of voice
Correct answer: Price premium index
The price premium index directly measures how much more consumers will pay for a branded product versus an unbranded substitute, reflecting brand equity's financial dimension.
Question 2: In Aaker's brand equity model, which component reflects the degree to which a brand name brings a quality or other associations to mind?
- Brand loyalty
- Brand awareness
- Perceived quality (Correct answer)
- Brand associations
Correct answer: Perceived quality
Perceived quality is Aaker's component that captures the consumer's judgment about a brand's overall superiority relative to competitors.
Question 3: A brand tracking study shows aided recall increased from 60% to 75% year-over-year. What does this most directly indicate?
- Improved brand salience when prompted (Correct answer)
- Higher unaided top-of-mind awareness
- Stronger brand loyalty
- Greater share of wallet
Correct answer: Improved brand salience when prompted
Aided recall measures recognition when prompted, so an increase signals improved salience when a cue is given, not spontaneous recall.
Question 4: Which financial valuation approach estimates brand equity by calculating the present value of future earnings attributable specifically to the brand?
- Cost-based approach
- Market-based approach
- Income-based approach (Correct answer)
- Replacement cost approach
Correct answer: Income-based approach
The income-based approach discounts projected brand-driven revenues to arrive at the brand's net present value.
Question 5: Consumer-based brand equity (CBBE) models primarily measure brand equity from which perspective?
- Accounting and balance sheet valuation
- Consumer perceptions and responses (Correct answer)
- Distribution channel strength
- Manufacturing cost advantages
Correct answer: Consumer perceptions and responses
CBBE frameworks like Keller's focus on how brand knowledge in consumers' minds shapes their perceptions and behaviors.
Question 6: Brand equity dilution is most likely to occur when a company:
- Increases advertising spend on the core brand
- Extends the brand into too many unrelated categories (Correct answer)
- Launches a loyalty rewards program
- Conducts annual brand equity tracking studies
Correct answer: Extends the brand into too many unrelated categories
Over-extension into unrelated categories weakens brand associations and blurs the core positioning, reducing overall equity.
Question 7: Which of the following is an example of a behavioral measure of brand equity?
- Brand personality ratings
- Repeat purchase rate (Correct answer)
- Unaided awareness scores
- Brand image attribute ratings
Correct answer: Repeat purchase rate
Repeat purchase rate captures actual consumer behavior, providing a behavioral (rather than attitudinal or perceptual) indicator of brand equity.
CBM Brand Equity Measurement 2
Which metric best captures the price premium a brand commands over a generic equivalent?