Chapter 12—Leveraging the Business
12.1
Four questions were suggested in the book as being a good source of growth options. One was asking
whether brand extensions are possible. Another was whether new distribution channels are available.
12.2
In leveraging an existing brand to move into a new market, the new brand may seek distance and
autonomy from the existing brand. However with that distance, the risk of the venture increases.
12.3
Three steps to determine which assets and competencies should be leveraged were suggested. The first
was to inventory assets and competencies, the second was to find an area where the assets and
competencies can be applied to generate advantage and the third was to analyze the potential synergy.
12.4
Brand extension evaluation asks three questions according to the book. Which of the following is not a
brand extension question among the three?
a. Will the brand extension be profitable?
b. Will the extension enhance the brand name and image?
c. Does the brand fit the new context?
d. Does the brand add value to the offering in the new product class?
12.5
Sub brands and endorsed brands are created when the parent company wants to prevent existing brands
from damage and when an entirely new brand is not feasible based on lack of resources.
12.6
Philip Morris was successful with 7-Up because of its distribution clout.
12.7
Entering into new markets or launching new products are met with the challenges of resistance to new
products, lack firm’s assets and competencies in the new product’s market and organizational access to
resources necessary for launches.
12.8
When there is a real potential synergy, it will happen—otherwise it will simply be a hope.
12.9
Budget Rent-A-Car experienced a surge of growth by entering the rental truck and travel arena.
12.10
According to Zook around one-third of successful sustainable growth companies had one or two repeatable
formulas.
12.11
According to the book, market development is based on the premise that the right people are available for
implementing the leveraged business.
12.12
One-stop financial services was a winning strategy in the 1980s.