Brand Management MCQ Quiz - Objective Question with Answer for Brand Management - Download Free PDF

The correct answer is 2) Higher the price, higher the sales.

Key PointsConsumer Behaviour:

• The economic model of consumer behaviour is based on the principle of rational decision-making by consumers, considering factors such as income, price, and promotional expenses.
• However, the relationship between price and sales is inverse according to the economic model, which contradicts option 2.

Important Points

• In the economic model, the relationship between price and sales is typically described by the law of demand, which states that as the price of a product increases, the quantity demanded by consumers decreases, and vice versa.
• This is based on the assumption that consumers are rational and seek to maximize their utility or satisfaction by making decisions that provide them the most value for their money.

Option 1, "Higher the income, higher the sales," is consistent with the economic model as consumers with higher incomes have greater purchasing power and may be more likely to purchase goods and services.

Option 3, "Higher the promotional expenses, higher the sales," is also in line with the economic model as increased promotional efforts can create awareness and influence consumer behavior, leading to higher sales.

Option 4, "Lower the price, higher the sales," is a fundamental principle of the economic model. According to the law of demand, when the price of a product decreases, the quantity demanded by consumers increases, assuming other factors remain constant.

Option 2, "Higher the price, higher the sales," is contrary to the economic model's assumption of consumer behaviour. The law of demand suggests that higher prices generally lead to lower sales, as consumers tend to be less willing to purchase a product at a higher price.

The correct answer is A, C and D only.

Key PointsLet's analyze each statement: 

• Cost approach (A) is a common method of measuring brand equity.
  • This approach assesses the cost required to create or replace the brand.
  • It involves calculating the brand's value based on historical costs and investment.
  • This method is straightforward but may not fully capture the brand's market value.
  • It provides a baseline value by considering the expenditure on brand building activities.
• Market approach (C) is a common method of measuring brand equity.
  • This approach evaluates the brand's value based on market transactions.
  • It looks at comparable brands and market data to estimate the brand's worth.
  • This method reflects the current market perception and demand for the brand.
  • It provides an external perspective by comparing the brand to similar entities in the market.
• Financial approach (D) is a common method of measuring brand equity.
  • This approach considers the brand's financial performance and future earning potential.
  • It involves discounting future cash flows to determine the brand's present value.
  • This method captures the brand's profitability and contribution to business revenue.
  • It integrates financial metrics to assess the brand's economic impact on the company.
• Simplifying product handling (B) is not a common method of measuring brand equity.
  • This concept is more related to operational efficiency than brand equity measurement.
  • It focuses on logistics and the ease of managing products rather than assessing brand value.
  • Simplifying product handling can improve operational processes but does not directly measure brand equity.
  • This method is not used to evaluate the financial or market worth of a brand.
• Business approach (E) is not a common method of measuring brand equity.
  • This term is vague and not specifically defined in the context of brand equity measurement.
  • It may refer to general business strategies rather than a distinct method for evaluating brand value.
  • The business approach lacks a standardized framework for assessing brand equity.
  • This method is not recognized as a primary approach in brand equity measurement literature.

The correct answer is  c, d, a, e, b.

Key Points The sequence c, d, a, e, b is the accurate order for the Brand Dynamics Pyramid. Here's the revised explanation:

1. c. Active familiarity with the brand based on post trial, saliency or knowledge of the brand promise: This forms the base of the pyramid. Consumers have encountered the brand through experience, advertising, or word-of-mouth, creating an initial level of recognition and awareness.
2. d. Relevance of brand to consumer's needs in the right price range or in the consideration set: Following familiarity, consumers assess the brand's relevance to their needs and budget. It enters their consideration set for potential purchase if it falls within their acceptable price range and addresses their basic requirements.
3. a. Belief that the brand delivers acceptable product performance and is on the consumer's short-list: After considering relevance, consumers evaluate the brand's perceived performance based on reviews, recommendations, or personal experience. Those meeting basic performance expectations move onto the shortlist for further evaluation.
4. e. Belief that the brand has an emotional or rational advantage over other brands in the category: Consumers who shortlisted the brand may perceive it to have a distinct edge over competitors. This advantage could be based on emotional connection, unique features, or superior value proposition.
5. b. Rational and emotional attachments to the brand to the exclusion of most other brands: At the peak of the pyramid, consumers develop strong emotional and rational bonds with the brand. They become loyal advocates, often preferring it over most other options in the category and actively recommending it to others.

The correct answer is Reverse Brainstorming.

Key Points The technique described, where consumers are provided with a list of problems in a specific product category and then asked to identify and discuss products within that category that have those problems, is called the Reverse Brainstorming technique.

Here's why:

• Traditional brainstorming: In a typical brainstorming session, individuals are encouraged to generate as many ideas as possible for solving a specific problem.
• Reverse brainstorming: This technique flips the script by focusing on identifying the negative aspects of existing products or situations. By looking for problems and flaws, it aims to spark creative solutions for improvement.
• In the specific example, providing consumers with a list of problems serves as a prompt for reverse brainstorming within the context of a particular product category. This technique encourages consumers to think critically about existing products, identify their shortcomings, and ultimately lead to the generation of creative solutions to address those problems.

Other terms sometimes used to describe this approach include:

• Negative brainstorming
• Problem-oriented brainstorming
• Anti-brainstorming

While traditional brainstorming focuses on generating positive ideas, reverse brainstorming excels at uncovering hidden flaws and inefficiencies, paving the way for innovative solutions

The correct answer is All of These.

Key Points

•  Product Information: Advertising serves as a platform to provide detailed information about a product or service. Through various advertising channels such as print, television, online, and social media, companies can present key features, specifications, functionalities, and other relevant details to inform and educate consumers.
• Message Highlighting: Advertising allows companies to emphasize important features or unique selling points of their products. By creating attention-grabbing headlines, visuals, and slogans, advertising draws attention to specific aspects that differentiate the product from competitors. This highlighting helps consumers quickly identify and understand the key benefits and features.
• Brand Awareness: Advertising helps create and increase brand awareness among the target audience. Through consistent exposure to advertising messages, customers become familiar with the brand, its products or services, and its unique attributes. This contributes to building brand recognition and recall, which are fundamental for a strong brand image.

Hence, the correct answer is All of These.

The correct answer is Brand imagery.

Important Points 

• Extrinsic properties of the product or services refer to those properties that are related to the product or services but not a physical part of it like the brand image for brand loyalty.
• Brand advertisement sales promotion etc. may increase the consumers' desire to buy the product and fulfill their psychological needs.

 Additional InformationBrand image shows the product is valuable and different from other brands due to which customers rely on and repurchase a product and become reliable and committed customers.

Brand judgments: Based on past experiences and with the brand itself allow us to generate opinions about a brand in the world of marketing this refers to brand judgment like Coca-Cola.

Brand resonance: When a brand creates an emotional connection with customers via its name image consistency refers to brand resonance. The more effective the emotional bond, the
higher the likelihood of purchase and hence create more loyal customers.

Brand performance: The measurement of a brand’s results against the target explains brand performance customers' growth customer interaction brand knowledge and brand awareness are some metrics to measure brand performance.

The correct answer is Engel- Kollat Blackwell model

Key Points

 Consumer Behaviour refers to the process in which a consumer takes decision with regard to what to buy, when to buy, how to buy, where to buy and how much to buy.

Important Points

•  Consumer Buying Behaviour model includes:
  • Engel- Kollat Blackwell Model
  • Nicosia Model
  • Hovard- Sheth Model 
  • Economic Model etc.
• Engel- Kollat Blackwell Model: This model was created in 1968 and it helps to describe the fast growing / increasing body of knowledge with regard to consumer behaviour.
• This model mainly consists of three stages, namely:
  • Information Input Stage
  • Information Processing Stage
  • Decision Processing Stage
• Information Input Stage : During this phase, a consumer collects information from the outside world with regard to  brand identification, price of the product, availability of product etc. with the help of different sources, such as: Radio, Television etc.
• Information Processing Stage: This stage includes Exposure, Attention, Comprehension, Acceptance and Retention of information about the product.
• Decision Processing Stage: The main focus of this model is on five basic decision process stages, namely:
  • Problem Recognition (Need arises)
  • Information Search (Finding out information through various sources) 
  • Evaluation of Different Alternatives (Assessing merits and demerits of products)
  • Purchase Decision (Buying product)
  • Post Purchase Behaviour (Monitoring Satisfaction)

Hence, the correct answer is Engel Kollat Blackwell Model.Confusion Points

The Engel-Kollat-Blackwell Model is a comprehensive model that explains consumer behavior and the decision-making process. It consists of four main components or stages:

• Input: In this stage, the consumer receives various stimuli from the internal and external environment, such as marketing messages, personal needs, and environmental factors.
• Information Processing: The consumer processes the received information through exposure, attention, comprehension, and retention. This stage involves gathering and interpreting relevant information related to the purchase decision.
• Decision Process: In this stage, the consumer evaluates alternatives based on their needs, preferences, and the information gathered. They engage in activities such as product evaluation, brand comparison, and selection.
• Variables Influencing the Consumer Decision Process: This stage considers various internal and external factors that influence the consumer's decision-making process, including individual characteristics, social influences, cultural norms, and situational factors.

Additional Information 

•  Nicosia Model was developed by Francesco Nicosia in 1966. This model helps to identify the relation between firm and  its consumer. It has four stages, namely: Firm Attribute and Customer Attribute, Search and Evaluation, Purchase Act, Feedback.
• Hovard Sheth Model was established in 1969 by Howard and Jagadish Sheth. The main aim of this model is to provide an empirically testable depiction of consumer behaviour and its outcomes as well. It has four variables, namely: Input, Learning and Perceptual Constructs, Output, Exogeneous Variables.

The correct answer is It is difficult to synchronize supply and demand with services.

Key PointsPerishability as a characteristic of service 

• Perishability is a unique characteristic of services that refers to the fact that services cannot be stored or inventoried. Once a service has been performed, it cannot be sold again.
• This means that service providers must match their capacity to the demand for their services in real-time, which can be challenging.
• For example, a restaurant cannot store meals for customers who may show up later in the day. It must prepare meals on demand, and if there are more customers than the restaurant can serve, those customers may be turned away. Similarly, a hotel cannot store unused rooms for later use, and if demand exceeds the available capacity, potential customers may be turned away.
• This perishability creates a challenge for service providers to effectively manage their capacity and ensure that they have enough resources to meet demand during peak periods, while not wasting resources during slower periods.
• To overcome this challenge, service providers may use strategies such as dynamic pricing, scheduling, and capacity management to balance supply and demand and optimize their utilization.

Hence, the correct answer is  It is difficult to synchronize supply and demand with services.

The correct answer is the difference between what consumers are willing to pay for a given quantity of goods and services and the amount they actually pay.

Key Points
 Consumer Surplus:

• The consumer surplus is a measure of the benefit that consumers receive from purchasing a good or service, and it's defined as the difference between the maximum price a consumer is willing to pay for a certain quantity of a product and the actual price they end up paying.
• In other words, if a consumer is willing to pay $50 for a product but only has to pay $30, their consumer surplus would be $20 ($50 - $30 = $20).
• Consumer surplus can also be thought of as the total value that consumers receive from consuming a product over and above what they actually pay for it.
• The concept of consumer surplus is often used in economics to measure the overall welfare or benefit that consumers receive from a particular market or industry.
• It can also help businesses and policymakers understand consumer behavior and make more informed decisions about pricing, production, and regulation.

Hence, the correct answer is the difference between what consumers are willing to pay for a given quantity of goods and services and the amount they actually pay.

The correct answer is Compensatory.

Key Points The consumer decision making rule that the person has employed is compensatory. This is a decision-making rule that allows consumers to trade off one attribute for another. In other words, a consumer may be willing to accept a lower score on one attribute if the product or service has a higher score on another attribute that is more important to them.

In the case of the laptop, the consumer may be willing to accept a lower price if the brand reputation is higher. Or, they may be willing to accept a lower processor speed if the RAM is higher.

The compensatory decision-making rule is a more complex approach than the multi-attribute decision making rule, but it allows consumers to make more informed decisions.

Additional Information Here are some other examples of compensatory decision making:

• A student may choose to attend a less prestigious university if it offers a better financial aid package.
• A job seeker may choose to accept a lower-paying job if it offers better benefits.
• A shopper may choose to buy a less expensive product if it has better reviews.

The compensatory decision-making rule is a common approach that consumers use when making purchase decisions. It is a more realistic approach than the multi-attribute decision making rule, because it allows consumers to consider the relative importance of different attributes.

Key Points

Consumer Buying Process and Steps involved:

• The consumer buying process is the steps a consumer takes in making a purchasing decision.
• The consumer decision-making process involves five basic steps.
• This is the process by which consumers evaluate making a purchasing decision.

Important Points

5 steps of the consumer decision making process

1. Problem recognition:

• Recognizes the need for a service or product
• The first step of the consumer decision-making process is recognizing the need for a service or product. Need recognition, whether prompted internally or externally, results in the same response: a want. Once consumers recognize a want, they need to gather information to understand how they can fulfill that want, which leads to step two.

2. Information search:

• Gathers information
• When researching their options, consumers again rely on internal and external factors, as well as past interactions with a product or brand, both positive and negative. In the information stage, they may browse through options at a physical location or consult online resources, such as Google or customer reviews.

3. Alternatives evaluation:

• Weighs choices against comparable alternatives
• At this point in the consumer decision-making process, prospective buyers have developed criteria for what they want in a product. Now they weigh their prospective choices against comparable alternatives. Alternatives may present themselves in the form of lower prices, additional product benefits, product availability, or something as personal as colour or style options.

4. Purchase decision:

• Makes actual purchase
• This is the moment the consumer has been waiting for: the purchase. Once they have gathered all the facts, including feedback from previous customers, consumers should arrive at a logical conclusion on the product or service to purchase.

5. Post-purchase evaluation:

• Reflects on the purchase they made
• This part of the consumer decision-making process involves reflection from both the consumer and the seller.

​Therefore, the correct sequence is D, A, B, E, C.

Sales management is the art of meeting and exceeding the sales goals of an organisation through effective planning, controlling, budgeting, and leadership. Sales management helps the organisation achieve its sales targets efficiently.

Key Points

Tasks involved in sales management:

The tasks under sales management are classified under three broad categories:

Sales operations

• Set sales targets. 
• Assign sales territories for them to manage.
• Establish goals and quotas.
• Setting sales goals and quotas
• Motivating and mentoring the team
• Creating sales plans and workflows
• Hiring and onboarding 
• Organizing sales training programs
• CRM and pipeline management
• Ensuring coordination with the sales enablement and marketing teams
• Overall team management

Sales strategy

• Lead generation, scoring and qualification
• The number of sales calls, follow-up emails, social media messages and other outreach activities they undertake
• Market research on new products, new segments and other relevant information
• Product knowledge
• Formulating sales policies

Sales analysis:

• It involves reporting.
• Reporting helps you understand how your current strategy affects your company’s success and gives your insight into what you can do to increase your efforts, whether it’s hiring more salespeople or redistributing tasks.
• Successful reporting involves using sales metrics, or quantifiable indicators, that tell you how each aspect of your sales operations is performing and whether you are achieving your targets.

Therefore, determining the selling price of the firm's products is not a task that is expected to be performed under sales management.

A brand using its assets, its abilities, or its unique features can gain a competitive advantage over its competitors. It’s when a company consistently outperforms its competition due to a specific attribute. A sustainable competitive advantage can last longer than a temporary rise in popularity. It means building products, services, a brand, and a reputation that attracts consumers continually over time.

Key Points

To gain a sustainable competitive advantage in low-cost manufacturing, Indian businesses are expected to

• Support raw material sourcing or extraction to manufacturing, transportation, use, and end of life of the product, understanding the product life cycle of a company to identify the boundaries of influence and responsibilities for the business and its clients.
• Set up a baseline assessment of current activities' boundaries and identify key social, economic, and environmental impacts. Set up a monitoring and reporting system that can enable this in an effective manner.
• Leverage product life cycle analysis to identify the main environmental impacts of a company’s products and packaging and focus on the real issues. define the boundaries of a company’s supply chain and increase traceability to help identify possible alternatives, via green procurement and sustainable sourcing practises.
• Communicate constantly with the clients to better anticipate the direction taken and alignment with the client’s mandate and/or expectations.
• Support MSMEs to strengthen the supply chain.
• Adopt product differentiation and focus more on innovation.
• Bridge the trust deficit and gain support from the public, workers, and policymakers.

​Hence, the correct answers are B, C and D only.

The correct answer is brand salience. 

Key PointsBrand Salience:

• Brand Salience is the degree to which your brand is thought of or noticed.
• Strong brands have high Brand Salience and weak brands have little or none.
• Without brand salience, people would not choose your brand at the moment of truth.
• At the moment of choice, brands are retrieved based on both memory & attention salience. 
• Memory salience: the mental network a brand has in a person’s mind as well as the mental availability of the brand (will people even have your brand in mind at the moment of choice?).
• Attention salience: the ability of the brand to capture people’s attention at the moment of choice.

Brand salience refers to how often and easily customers think of a brand in different purchase or consumption situations. It represents the level of awareness and prominence a brand has in the minds of consumers.

Additional InformationBrand resonance:

• Brand resonance refers to the nature of the relationship that customers have with the brand and the extent to which they feel that they are “in sync” with the brand.
• Brand resonance can be defined as how well you connect with your customer both formally and casually.

Brand feelings:

• What customers feel for the product or how they're emotionally attached to the product.
• Consumers can develop feelings towards brands regarding fun, safety, self-esteem, social acceptance, etc.

Brand Imagery: 

• Brand imagery refers to every type of visual that represents your brand.
• It includes the aesthetic appearance of all the marketing materials that communicate a message about your brand.

Hence, How often and how easily customers think of the brand under various purchase or consumption situations is known as brand salience. 

The correct answer is Statement I is incorrect but Statement II is correct 

Key Points The correct answer is Statement I is incorrect but Statement II is correct 

• Statement I is incorrect: If there are differences in consumer responses, it implies that the brand-name product is not simply a commodity. Consumers perceive a difference based on factors beyond just price, which is the essence of brand equity. Therefore, competition might not solely focus on price.
• Statement II is correct: This statement accurately defines brand equity by encompassing the various perceptions, performance aspects, and behavioral responses related to all marketing elements of the brand.

Hence, "Statement I is incorrect but Statement II is correct" is the most appropriate answer in this context.