CMP Brand Management and Promotion 3 — Questions and Answers
Question 1: Nike partnering with Apple to create Nike+ running products is best classified as:
- Brand licensing
- Line extension
- Co-branding (Correct answer)
- Brand acquisition
Correct answer: Co-branding
Co-branding involves two or more brands collaborating on a product or campaign, leveraging each brand's equity to create mutual value.
Question 2: A brand audit reveals that unaided brand recall is high but brand consideration is low. The most likely cause is:
- Poor brand awareness
- Weak brand relevance or differentiation (Correct answer)
- Inadequate media spending
- Poor product quality
Correct answer: Weak brand relevance or differentiation
High awareness but low consideration indicates consumers know the brand exists but don't see it as relevant or meaningfully different from alternatives.
Question 3: The 'share of wallet' metric in brand management measures:
- Total market share by revenue
- Percentage of a customer's category spending captured by the brand (Correct answer)
- Number of brand touchpoints per customer
- Brand advertising spend relative to competitors
Correct answer: Percentage of a customer's category spending captured by the brand
Share of wallet measures what proportion of a customer's total spending in a category goes to a specific brand, reflecting loyalty depth.
Question 4: A company repositions its brand from 'affordable family car' to 'eco-friendly urban commuter.' Which risk is most associated with this repositioning?
- Brand dilution
- Losing existing loyal customers who valued the original positioning (Correct answer)
- Increased trademark infringement risk
- Reduced share of voice
Correct answer: Losing existing loyal customers who valued the original positioning
Repositioning risks alienating the existing customer base whose purchase decisions were based on the original brand positioning.
Question 5: In the context of promotional mix, which element is most effective for building long-term brand relationships and credibility through earned media?
- Advertising
- Sales promotion
- Public relations (Correct answer)
- Direct marketing
Correct answer: Public relations
Public relations generates earned media coverage and third-party endorsements that build credibility and long-term brand trust more organically than paid advertising.
Question 6: A brand manager calculates that the brand's price premium over the category average is 22%. This metric is most directly related to which concept?
- Brand awareness
- Brand equity (Correct answer)
- Brand loyalty rate
- Brand salience
Correct answer: Brand equity
The ability to command a price premium over generic or competitor alternatives is a direct financial manifestation of brand equity.
Question 7: Which brand architecture model uses a single master brand to endorse all products while allowing each product to retain its own identity (e.g., Marriott's portfolio)?
- House of brands
- Branded house
- Endorsed brand architecture (Correct answer)
- Shadow endorser model
Correct answer: Endorsed brand architecture
The endorsed brand architecture allows individual product brands to maintain distinct identities while visibly connecting to a credible parent or master brand.
CMP Brand Management and Promotion 3
Nike partnering with Apple to create Nike+ running products is best classified as: