Question 1

Many banks and phone companies now charge fees for once-free services to ensure minimum customer revenue levels. This helps banks to ________.

Accepted Answer

A)  reduce the rate of customer defection 
B)  make low-profit customers more profitable 
C)  enhance the growth potential for each customer through cross-selling 
D)  increase the longevity of the customer relationship 
E)  focus disproportionate effort on high-value customers 
A)  reduce the rate of customer defection 
B)  make low-profit customers more profitable 
C)  enhance the growth potential for each customer through cross-selling 
D)  increase the longevity of the customer relationship 
E)  focus disproportionate effort on high-value customers

Question 2

Cell phone manufacturer LZT has to choose between two options for sourcing parts: Japan-based Keiko Inc. and US-based Global Tech. How can Keiko reduce the total customer cost for LZT?

Accepted Answer

A)  by absorbing some risk by offering a warranty 
B)  by improving the functional aspects of the products 
C)  by augmenting the psychological benefits of the products 
D)  by training service personnel to improve their skills 
E)  by investing in brand building for the products 
A)  by absorbing some risk by offering a warranty 
B)  by improving the functional aspects of the products 
C)  by augmenting the psychological benefits of the products 
D)  by training service personnel to improve their skills 
E)  by investing in brand building for the products

Question 3

________ is the difference between the prospective customer's evaluation of all benefits and all costs of an offering and the perceived alternatives.

Accepted Answer

A)  Perceived usefulness 
B)  Failure avoidance rate 
C)  Total customer benefit 
D)  Customer-perceived value 
E)  Competitors' market share rate 
A)  Perceived usefulness 
B)  Failure avoidance rate 
C)  Total customer benefit 
D)  Customer-perceived value 
E)  Competitors' market share rate

Question 4

All companies should practice one-to-one marketing.

Accepted Answer

A) True 
 B)False

Question 5

For a magazine, subscription renewal rate is a good measure of retention.

Accepted Answer

A) True 
 B)False

Question 6

In a modern customer-oriented organization chart, the ________ of an organization immediately follow the customer segment.

Accepted Answer

A)  top management 
B)  marketing department 
C)  middle management 
D)  frontline people 
E)  lower management 
A)  top management 
B)  marketing department 
C)  middle management 
D)  frontline people 
E)  lower management

Question 7

Customer profitability analysis is best conducted with the tools of an accounting technique called activity-based costing.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following can a company do to reduce defection?

Accepted Answer

A)  Attract new customers to try out the company's products. 
B)  Increase customer lifetime value by increasing the non-monetary costs of products. 
C)  Enhance the growth potential of existing customers through cross-selling and upselling. 
D)  Distinguish the causes of customer attrition and identify those that can be managed better. 
E)  Make low-profit customers more profitable or terminate the relationship. 
A)  Attract new customers to try out the company's products. 
B)  Increase customer lifetime value by increasing the non-monetary costs of products. 
C)  Enhance the growth potential of existing customers through cross-selling and upselling. 
D)  Distinguish the causes of customer attrition and identify those that can be managed better. 
E)  Make low-profit customers more profitable or terminate the relationship.

Question 9

Which of the following is true for customer-perceived value?

Accepted Answer

A)  It is the perceived monetary value of the bundle of economic, functional, and psychological benefits customers expect from a product. 
B)  It is the difference between the prospective customer's evaluation of all the benefits and all the costs of an offering and the perceived alternatives. 
C)  It is the perceived bundle of costs customers expect to incur in evaluating, obtaining, using, and disposing of the given market offering. 
D)  It is the net present value of the stream of future profits expected over the customer's lifetime purchases. 
E)  It is the process of investigating the hierarchy of attributes consumers examine in choosing a brand if they use phased decision strategies. 
A)  It is the perceived monetary value of the bundle of economic, functional, and psychological benefits customers expect from a product. 
B)  It is the difference between the prospective customer's evaluation of all the benefits and all the costs of an offering and the perceived alternatives. 
C)  It is the perceived bundle of costs customers expect to incur in evaluating, obtaining, using, and disposing of the given market offering. 
D)  It is the net present value of the stream of future profits expected over the customer's lifetime purchases. 
E)  It is the process of investigating the hierarchy of attributes consumers examine in choosing a brand if they use phased decision strategies.

Question 10

Explain total customer satisfaction.

Accepted Answer

In general, satisfaction is a person's f

Question 11

The aim of customer relationship management is to keep the costs of meeting and tracking consumers as low as possible.

Accepted Answer

A) True 
 B)False

Question 12

A company should try to retain a customer only as long as the cost to discourage defection is lower than the lost profit.

Accepted Answer

A) True 
 B)False

Question 13

Customer churn is how rapidly a store can move customers through its checkout facility or process.

Accepted Answer

A) True 
 B)False

Question 14

A customer ________ is any occasion on which a customer encounters the brand and product - from actual experience to personal or mass communications to casual observation.

Accepted Answer

A)  touch point 
B)  point of order 
C)  point of difference 
D)  pivot point 
E)  point of parity 
A)  touch point 
B)  point of order 
C)  point of difference 
D)  pivot point 
E)  point of parity

Question 15

________ helps companies manage and monitor online reviews using a process called device fingerprinting.

Accepted Answer

A)  Gawker 
B)  Bazaarvoice 
C)  Metacritic 
D)  Angie's List 
E)  Technorati 
A)  Gawker 
B)  Bazaarvoice 
C)  Metacritic 
D)  Angie's List 
E)  Technorati

Question 16

The 80-20 rule reflects the idea that ________.

Accepted Answer

A)  20 percent of the company's profits are generated by the top 80 percent of customers 
B)  the top 20 percent of customers are highly satisfied and 80 percent of customers will recommend the company to a friend 
C)  20 percent of customers are unprofitable, and 80 percent make up a company's profits 
D)  the top 20 percent of customers often generate 80 percent of the company's profits 
E)  any new product will be accepted by 20 percent of the customers immediately, but 80 percent of the customers will be up for grabs throughout the product's life cycle 
A)  20 percent of the company's profits are generated by the top 80 percent of customers 
B)  the top 20 percent of customers are highly satisfied and 80 percent of customers will recommend the company to a friend 
C)  20 percent of customers are unprofitable, and 80 percent make up a company's profits 
D)  the top 20 percent of customers often generate 80 percent of the company's profits 
E)  any new product will be accepted by 20 percent of the customers immediately, but 80 percent of the customers will be up for grabs throughout the product's life cycle

Question 17

Berry's is a chain of shoe stores. The marketing team suggested that the company use permission marketing instead of interruption marketing. How can this benefit the company?

Accepted Answer

Berry's, as a chain of shoe stores, can

Question 18

Give an example of how a hotel can generate customer loyalty at a "customer touch point."

Accepted Answer

A hotel can generate customer loyalty at

Question 19

Club membership programs that are open to everyone who purchases a product or service ________.

Accepted Answer

A)  are more powerful long-term loyalty builders than limited-membership clubs 
B)  will not help a company attract customers from competitors 
C)  prevent those with only a fleeting interest in a company's products from joining 
D)  are useful for building a database of customers but are not very good as long-term loyalty builders 
E)  are useless unless there are fees and membership conditions 
A)  are more powerful long-term loyalty builders than limited-membership clubs 
B)  will not help a company attract customers from competitors 
C)  prevent those with only a fleeting interest in a company's products from joining 
D)  are useful for building a database of customers but are not very good as long-term loyalty builders 
E)  are useless unless there are fees and membership conditions

Question 20

________ is the perceived monetary value of the bundle of economic, functional, and psychological benefits customers expect from a given market offering.

Accepted Answer

A)  Total customer cost 
B)  Total customer benefit 
C)  Total benefits of ownership 
D)  Value proposition 
E)  Value delivery system 
A)  Total customer cost 
B)  Total customer benefit 
C)  Total benefits of ownership 
D)  Value proposition 
E)  Value delivery system

Exam 5: Creating Long-Term Loyalty Relationships

Many banks and phone companies now charge fees for once-free services to ensure minimum customer revenue levels. This helps banks to ________.

Cell phone manufacturer LZT has to choose between two options for sourcing parts: Japan-based Keiko Inc. and US-based Global Tech. How can Keiko reduce the total customer cost for LZT?

________ is the difference between the prospective customer's evaluation of all benefits and all costs of an offering and the perceived alternatives.

All companies should practice one-to-one marketing.

For a magazine, subscription renewal rate is a good measure of retention.

In a modern customer-oriented organization chart, the ________ of an organization immediately follow the customer segment.

Customer profitability analysis is best conducted with the tools of an accounting technique called activity-based costing.

Which of the following can a company do to reduce defection?

Which of the following is true for customer-perceived value?

Explain total customer satisfaction.

The aim of customer relationship management is to keep the costs of meeting and tracking consumers as low as possible.

A company should try to retain a customer only as long as the cost to discourage defection is lower than the lost profit.

Customer churn is how rapidly a store can move customers through its checkout facility or process.

A customer ________ is any occasion on which a customer encounters the brand and product - from actual experience to personal or mass communications to casual observation.

________ helps companies manage and monitor online reviews using a process called device fingerprinting.

The 80-20 rule reflects the idea that ________.

Berry's is a chain of shoe stores. The marketing team suggested that the company use permission marketing instead of interruption marketing. How can this benefit the company?

Give an example of how a hotel can generate customer loyalty at a "customer touch point."

Club membership programs that are open to everyone who purchases a product or service ________.

________ is the perceived monetary value of the bundle of economic, functional, and psychological benefits customers expect from a given market offering.

Defining Marketing for the New Realities

Developing Marketing Strategies and Plans

Collecting Information and Forecasting Demand

Conducting Marketing Research

Analyzing Consumer Markets

Analyzing Business Markets

Tapping Into Global Markets

Identifying Market Segments and Targets

Crafting the Brand Positioning

Creating Brand Equity

Addressing Competition and Driving Growth

Setting Product Strategy

Designing and Managing Services

Introducing New Market Offerings

Developing Pricing Strategies and Programs

Designing and Managing Integrated Marketing Channels

Managing Retailing, Wholesaling, and Logistics

Designing and Managing Integrated Marketing Communications

Managing Mass Communications: Advertising, Sales Promotions, Events and Experiences, and Public Relations

Managing Digital Communications: Online, Social Media, and Mobile

Managing Personal Communications: Direct and Database Marketing and Personal Selling

Managing a Holistic Marketing Organization for the Long Run

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