Final answer:
The benefits of strong brands do not typically include a more elastic consumer response to price decreases, as loyal consumers are less price-sensitive. Strong brands enjoy loyal customer bases, less vulnerability to competition, and can command larger margins.
Step-by-step explanation:
The benefits of strong brands include greater loyalty, less vulnerability to competitive marketing actions, and the ability to charge larger margins. These advantages lead to a less elastic consumer response to price increases because consumers are willing to pay more for brands they trust and are loyal to.
However, a strong brand does not typically lead to more elastic consumer response to price decreases; this is because consumers loyal to a brand are less price-sensitive to begin with, so while they may enjoy a price decrease, it doesn't significantly change their purchasing behavior as much as it might with a weaker brand.
Strong brands can afford significant advertising budgets that discourage competition and help to build a well-respected brand name over time. An established brand can leverage economies of scale, command higher prices, and create a defensive barrier against new entrants looking to compete on price.
Overall, while strong brands enjoy many competitive advantages, the one area where they do not necessarily benefit is in elasticity of consumer response to price decreases. Consumers with strong brand loyalty tend to have made their purchasing decisions based on factors beyond just price.
Therefore, the correct answer is D) more elastic consumer response to price decreases.