Question 1

When two brands of the same basic product deliver their respective promised quality, they are delivering ________.

Accepted Answer

A)  performance quality 
B)  conformance quality 
C)  unique quality 
D)  accuracy quality 
E)  customer support 
A)  performance quality 
B)  conformance quality 
C)  unique quality 
D)  accuracy quality 
E)  customer support B

Question 2

The process of building, maintaining, and using customer databases and other databases for the purpose of contacting, transacting, and building customer relationships is called ________.

Accepted Answer

A)  data warehousing 
B)  data mining 
C)  database marketing 
D)  participatory marketing 
E)  permission marketing 
A)  data warehousing 
B)  data mining 
C)  database marketing 
D)  participatory marketing 
E)  permission marketing C

Question 3

Compare and contrast the typical traditional organization chart for an organization against the modern customer-oriented organization chart.

Accepted Answer

The traditional organization chart is a pyramid with the president at the top, management in the middle, and frontline people and customers at the bottom. In this case, the top management is the most important part of an organization. Managers who believe the customer is the company's only true "profit center" consider the traditional organization chart obsolete.
In the modern customer-oriented organization chart, customers are at the top, followed by frontline people, then middle management, and, lastly, top management.

Question 4

Loyalty is a person's feelings of pleasure or disappointment that result from comparing a product's perceived performance to expectations.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following is not conducive to database marketing?

Accepted Answer

A)  Rushbury Theater relies on the generosity of donors to keep functioning. 
B)  Kenilworthy retails luxury handbags and leather accessories to a select clientele. 
C)  2Wheels sells its most profitable products to repeat customers. 
D)  Uncle Jim's sells its range of snacks in stores throughout the country. 
E)  PetZone offers obedience classes, a doggie daycare and other services for pets in the Manhattan area. 
A)  Rushbury Theater relies on the generosity of donors to keep functioning. 
B)  Kenilworthy retails luxury handbags and leather accessories to a select clientele. 
C)  2Wheels sells its most profitable products to repeat customers. 
D)  Uncle Jim's sells its range of snacks in stores throughout the country. 
E)  PetZone offers obedience classes, a doggie daycare and other services for pets in the Manhattan area.

Question 6

Customer-perceived value is based on the difference between benefits the customer gets and
costs he or she assumes for different choices.

Accepted Answer

A) True 
 B)False

Question 7

________ describes the net present value of the stream of future profits expected over the customer's lifetime purchases.

Accepted Answer

A)  Activity-based costing 
B)  Customer lifetime value 
C)  Customer value analysis 
D)  Customer-perceived value 
E)  Customer profitability analysis 
A)  Activity-based costing 
B)  Customer lifetime value 
C)  Customer value analysis 
D)  Customer-perceived value 
E)  Customer profitability analysis

Question 8

________ is based on the premise that marketers can no longer use "interruption marketing" via mass media campaigns.

Accepted Answer

A)  Relationship marketing 
B)  Permission marketing 
C)  Database marketing 
D)  Internet marketing 
E)  Horizontal marketing 
A)  Relationship marketing 
B)  Permission marketing 
C)  Database marketing 
D)  Internet marketing 
E)  Horizontal marketing

Question 9

Cell phone manufacturer LZT has to choose between two options for sourcing parts: Japan-based Keiko Inc. and U.S.-based Global Tech. Though Keiko's products are priced lower than Global's, the non-monetary costs of doing business with Keiko may lead LZT to choose Global Tech. What can Keiko do to obtain LZT's order?

Accepted Answer

Student answers may vary. Keiko can incr

Question 10

LifeTime Insurance screens its customers and tries to get unprofitable customers to buy services from competitors. This is an example of ________.

Accepted Answer

A)  trying to increase the retention rate for low-profit customers 
B)  terminating the relationship with low-profit customers 
C)  enhancing the growth potential of each customer through up-selling 
D)  increasing the longevity of the customer relationship 
E)  reducing the rate of customer defection 
A)  trying to increase the retention rate for low-profit customers 
B)  terminating the relationship with low-profit customers 
C)  enhancing the growth potential of each customer through up-selling 
D)  increasing the longevity of the customer relationship 
E)  reducing the rate of customer defection

Question 11

What are the measurement techniques for monitoring satisfaction?

Accepted Answer

Many companies are systematically measur

Question 12

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

Accepted Answer

A) True 
 B)False

Question 13

Building a customer database is not recommended when the product is a once-in-a-lifetime purchase.

Accepted Answer

A) True 
 B)False

Question 14

A ________ is a person, household, or company that over time yields a revenue stream that exceeds by an acceptable amount the company's cost stream of attracting, selling, and servicing that customer.

Accepted Answer

A)  prospector 
B)  profitable customer 
C)  market challenger 
D)  market nicher 
E)  pioneer customer 
A)  prospector 
B)  profitable customer 
C)  market challenger 
D)  market nicher 
E)  pioneer customer

Question 15

Which of the following is true for activity-based costing (ABC)?

Accepted Answer

A)  ABC considers the real costs associated with each product. 
B)  With ABC, the company can estimate all costs coming from the customer, less revenue. 
C)  The tools of ABC can be used to conduct customer profitability analysis. 
D)  It identifies the costs of products and services based on the revenue they generate. 
E)  ABC allocates indirect costs in proportion to direct costs. 
A)  ABC considers the real costs associated with each product. 
B)  With ABC, the company can estimate all costs coming from the customer, less revenue. 
C)  The tools of ABC can be used to conduct customer profitability analysis. 
D)  It identifies the costs of products and services based on the revenue they generate. 
E)  ABC allocates indirect costs in proportion to direct costs.

Question 16

________ is the process of carefully managing detailed information about individual customers and all customer "touch points" to maximize loyalty.

Accepted Answer

A)  Customer relationship management 
B)  Customer lifetime value 
C)  Customer profitability analysis 
D)  Customer satisfaction analysis 
E)  Customer-value delivery 
A)  Customer relationship management 
B)  Customer lifetime value 
C)  Customer profitability analysis 
D)  Customer satisfaction analysis 
E)  Customer-value delivery

Question 17

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 18

Which of the following is a step in one-to-one marketing that can be adapted for CRM marketing?

Accepted Answer

A)  Identify the lifetime value of lost customers. 
B)  Define and measure the retention rate of customers. 
C)  Offer the lowest price for a particular product. 
D)  Distinguish the causes of customer attrition. 
E)  Customize products, services, and messages to each customer. 
A)  Identify the lifetime value of lost customers. 
B)  Define and measure the retention rate of customers. 
C)  Offer the lowest price for a particular product. 
D)  Distinguish the causes of customer attrition. 
E)  Customize products, services, and messages to each customer.

Question 19

________ is the difference between the prospective customer's evaluation of all the benefits and all the 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 20

All companies should practice one-to-one marketing.

Accepted Answer

A) True 
 B)False

Exam 5: Creating Long-Term Loyalty Relationships

When two brands of the same basic product deliver their respective promised quality, they are delivering ________.

The process of building, maintaining, and using customer databases and other databases for the purpose of contacting, transacting, and building customer relationships is called ________.

Compare and contrast the typical traditional organization chart for an organization against the modern customer-oriented organization chart.

Loyalty is a person's feelings of pleasure or disappointment that result from comparing a product's perceived performance to expectations.

Which of the following is not conducive to database marketing?

Customer-perceived value is based on the difference between benefits the customer gets and costs he or she assumes for different choices.

________ describes the net present value of the stream of future profits expected over the customer's lifetime purchases.

________ is based on the premise that marketers can no longer use "interruption marketing" via mass media campaigns.

LifeTime Insurance screens its customers and tries to get unprofitable customers to buy services from competitors. This is an example of ________.

What are the measurement techniques for monitoring satisfaction?

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

Building a customer database is not recommended when the product is a once-in-a-lifetime purchase.

A ________ is a person, household, or company that over time yields a revenue stream that exceeds by an acceptable amount the company's cost stream of attracting, selling, and servicing that customer.

Which of the following is true for activity-based costing (ABC)?

________ is the process of carefully managing detailed information about individual customers and all customer "touch points" to maximize loyalty.

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

Which of the following is a step in one-to-one marketing that can be adapted for CRM marketing?

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

All companies should practice one-to-one marketing.

Defining Marketing for the 21st Century

Developing Marketing Strategies and Plans

Collecting Information and Forecasting Demand

Conducting Marketing Research

Analyzing Consumer Markets

Analyzing Business Markets

Identifying Market Segments and Targets

Creating Brand Equity

Crafting the Brand Positioning

Competitive Dynamics

Setting Product Strategy

Designing and Managing Services

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 Personal Communications: Direct and Interactive Marketing, Word of Mouth, and Personal Selling

Introducing New Market Offerings

Tapping into Global Markets

Managing a Holistic Marketing Organization for the Long Run

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