Evaluate the statements according to Brand Asset Valuator Model of Brand Equity : Statement (I) : Knowledge measures the degree to which a brand is seen as different from others as well as its pricing power. Statement (II) : Esteem measures perceptions of quality and loyalty or how well the brand is regarded and respected. Code :
Statement (I) is incorrect while Statement (II) is correct.
Statement (I) is incorrect while Statement (II) is correct — option 4.
The model. The Brand Asset Valuator was developed by the advertising agency Young & Rubicam, which surveys hundreds of thousands of consumers across thousands of brands. It measures brand equity on four pillars :
| Pillar | What it measures |
|---|---|
| Differentiation | The degree to which the brand is seen as different from others, and the source of its pricing power |
| Relevance | The breadth of the brand’s appeal — whether it is personally appropriate to the consumer |
| Esteem | Perceptions of quality and loyalty — how well the brand is regarded and respected |
| Knowledge | Awareness and understanding — how familiar and intimate consumers are with the brand |
Statement (I) is wrong because it attributes to Knowledge what belongs to Differentiation. Difference and pricing power are the definition of the Differentiation pillar; Knowledge is a matter of familiarity, and a brand can be very widely known and yet wholly undifferentiated.
Statement (II) is exactly right — quality, loyalty, regard and respect are the Esteem pillar, word for word.
The two composites, which are what make the model useful :
| Composite | Pillars | Meaning |
|---|---|---|
| Brand strength | Differentiation × Relevance | A leading indicator — it predicts future growth and value |
| Brand stature | Esteem × Knowledge | A lagging indicator — it records past performance and current standing |
Plotted against each other on the power grid, the two composites trace a brand’s life cycle: new brands show high differentiation but little of the rest; leadership brands score high on all four; an eroding brand keeps its knowledge and esteem while its differentiation decays — which is the standard warning sign, because differentiation is always the first pillar to fall.
Do not confuse this with Keller’s Customer-Based Brand Equity pyramid (salience, performance and imagery, judgements and feelings, resonance) or with Aaker’s five-asset model. All three are separate frameworks and papers regularly test whether the candidate can tell them apart.
Hence, the answer is option 4.
Similar Questions
The step after 'concept testing' in the new product development process is:
From the given columns which of the combinations best describe the concepts of product hierarchy?
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A. Adjustability
B. Awareness
C. Accessibility
D. Affordability
E. Acceptability
Choose the correct answer from the options given below :
Under which of the following conditions, a brand is said to have a negative brand equity ?
Under Brand Sponsorship, store brands are also known as which other names from the following?
A. National Brands
B. Generic Brands
C. Private Brands
D. Distributor Brands
E. Manufacturers Brands
Choose the correct answer from the options given below:
Important Questions from Marketing mix
Which of the following statements represents marketing ?
- Which one is not a part of Marketing Mix ?
- Give the correct sequence for Marketing strategy.
(i) Promotion
(ii) Packing
(iii) Analysing
(iv) Developing
(v) Distribution
(vi) Pricing
Code : - Match the pricing strategies in List - I with their appropriate explanation in List - II :
List - I List - II (a) Bundle pricing (i) Price for any product is deliberately fixed lower than the prices of competitors (b) Parity pricing (ii) Prices fixed for similar products and services are the same as competitor’s prices (c) Penetration pricing (iii) Price fixation is allowed at levels higher than competitors (d) Premium pricing (iv) Involves being the leader in fixing prices by benchmarking them (v) Set of products and services are clubbed together and charged at lower than the sum of individual elements in the mix The step after 'concept testing' in the new product development process is:
