Investment Management Certificate (IMC) Practice Exam

The concept of effective reach indicates that fewer exposures to advertisements are adequate for what type of brands?

1. For necessities

2. For high-priced products

3. For brands with higher market shares and greater customer loyalty

4. When humor is used

The correct answer is: For brands with higher market shares and greater customer loyalty

Effective reach refers to the number of times a target audience must be exposed to an advertisement for it to have the desired impact on their purchasing behavior. The concept suggests that brands with higher market shares and greater customer loyalty can achieve marketing effectiveness with fewer advertising exposures. This is because consumers who are already familiar and satisfied with these brands are likely to have a positive predisposition toward them, resulting in a higher response rate after fewer encounters with the advertisements. For brands that hold significant market shares, customers often already have established relationships and trust, which means they do not require as many reminders or exposures to advertisements before deciding to purchase. The recognition and loyalty towards these brands reduce the need for excessive advertising efforts to convey the message effectively. Thus, fewer but more targeted exposures can be sufficient to maintain their market position and encourage purchase behavior. In contrast, necessities might require continuous reminders due to their nature of repetitive consumption, high-priced products often require more justification and consideration before a purchase decision, and humor may not necessarily correlate directly with effective reach, as responses can vary widely among different audience segments. These factors explain why effective reach is particularly relevant and effective for brands that already enjoy high market share and strong customer loyalty.