Question Pack 1 - Medium - CR Products sold under a brand na

[richachampion]

Products sold under a brand name used to command premium prices because, in general, they were superior to non brand rival products. Technical expertise in product development has become so widespread, however, that special quality advantages are very hard to obtain these days and even harder to maintain. As a consequence, brand-name products generally neither offer higher quality nor sell at higher prices. Paradoxically, brand names are a bigger marketing advantage than ever.

Which of the following, if true, most helps to resolve the paradox outlined above?

(A) Brand names are taken by consumers as a guarantee of getting a product as good as the best rival products.

(B) Consumers recognize that the quality of products sold under invariant brand names can drift over time.

(C) In many acquisitions of one corporation by another, the acquiring corporation is interested more in acquiring the right to use certain brand names than in acquiring existing production facilities.

(D) In the days when special quality advantages were easier to obtain than they are now, it was also easier to get new brand names established.

(E) The advertising of a company's brand-name products is at times transferred to a new advertising agency, especially when sales are declining.

[richachampion]

OA: A

[richachampion]

Is my understanding correct for Option C:

Option C doesn't state that the acquisitions are done for marketing advantage. we can't assume this to be true.
Acquisition can be because of various reasons such as perception management, recognition management etc. All these may spice up to the marketing advantage, but they do not give a reason "WHY" they may add up in the marketing advantage. we need the answer to "WHY" not "because of". It could have been the correct answer choice if the answer choice A was not available.

[DavidG@VeritasPrep]

Is my understanding correct for Option C:

Option C doesn't state that the acquisitions are done for marketing advantage. we can't assume this to be true.
Acquisition can be because of various reasons such as perception management, recognition management etc. All these may spice up to the marketing advantage, but they do not give a reason "WHY" they may add up in the marketing advantage. we need the answer to "WHY" not "because of". It could have been the correct answer choice if the answer choice A was not available.

We're looking for an explanation of why a brand name confers a competitive advantage when it's no longer true that brand name products are of higher quality than their non-brand name alternatives. In essence, we're trying to get inside the mind of a discerning consumer. Let's call this consumer "Dave." Why would Dave buy a brand name product when that product isn't necessarily any better than competing products? Well, Dave must think that the brand name product is some kind of quality guarantee - he's more worried about getting a dud from an known company than he is about purchasing something that's better than everything else on the market.

In other words, the key to understanding the logic here is to be privy to consumer perceptions. C is giving us information about the mindset of acquiring corporations. That doesn't help explain why the brand name is an actual advantage. It merely suggests that acquiring corporations may believe that there's an advantage.

[richachampion]

In other words, the key to understanding the logic here is to be privy to consumer perceptions. C is giving us information about the mindset of acquiring corporations.

Fantastic!

[DavidG@VeritasPrep]

In other words, the key to understanding the logic here is to be privy to consumer perceptions. C is giving us information about the mindset of acquiring corporations.

Fantastic!

Love the CR enthusiasm