Deck 14: Customer Satisfaction and Customer Relationships

Question 1

A high-involvement purchase requires a lot of thought and planning.

Answer 1

True

Question 2

There are three possible outcomes of customer evaluations: (1) a customer's expectations may be confirmed, leading to judgments of satisfaction; (2) the expectations may be disconfirmed in a positive manner, that is, the purchase experience surpassed the expectations, leading to feelings of delight; or (3) the expectations may be disconfirmed in a negative manner, that is, the purchase fell short of expectations, leading to feelings of dissatisfaction.

Answer 2

True

Question 3

Both core components and the peripheral, value-added supplemental components contribute to customer satisfaction and dissatisfaction.

Answer 3

True

Question 4

Sara wants to buy a new bike. She evaluates the bike on color, size, price, number of gears, and other features. The bike is an example of a credence good.

Question 5

Maria is going on vacation, and she used a travel agent to purchase her tickets and hotel room. This is an example of an experiential purchase.

Question 6

Expectations generated from the marketing mix are usually trusted the most since the information comes from an unbiased source.

Question 7

Marketers are interested in customer satisfaction, perceptions of quality, customers' intentions to repurchase the same brand or purchase something else from the same provider, and the likelihood that a customer will generate positive word-of-mouth.

Question 8

Chewing Gum Co. is curious about whether or not the comparative evaluation process occurs despite the fact that purchases of its chewing gum products are typically a routine, low involvement, repurchase. In this scenario, the comparative evaluation process is deliberative and conscious.

Question 9

Edgar tells the product design team that it is important to design a reliable product to increase the likelihood of Consumer Reports giving it a positive evaluation. In turn, this would be important because third-party communications help consumers form expectations based on objective ratings on issues such as quality and value.

Question 10

Movie Palace is a local cinema and its management team is debating whether or not it should begin tracking customer loyalty. Deborah is a manager who supports tracking loyalty. She should argue that they should track loyalty because truly loyal customers love the brand, are zealous in telling others about the brand, and are even willing to pay more for the brand and all it means to them.

Question 11

If purchase experiences are judged relative to expectations, it is important to understand the mechanism of expectations.

Question 12

Marketers only track customer evaluations because they're interesting.

Question 13

The comparison of a purchase to expectations is thought to occur whether the item purchased is comprised primarily of search, experience, or credence characteristics.

Question 14

Experiences are always direct; they cannot be indirect.

Question 15

Jonathan just bought his usual brand of chips from the grocery store without thinking much about it. The fact that
he normally doesn't evaluate his chips purchase means that it is a high­involvement purchase.

Question 16

The two components of quality and satisfaction are expectations and experiences.

Question 17

In marketing, the abbreviation CRM represents customer relationship modeling.

Question 18

During a credence purchase, the customer will evaluate the purchase based on what he can or understands, not necessarily what the product or service actually is.

Question 19

If a consumer has little personal expertise on which to make a brand choice, a logical and trusted source of information is friends.

Question 20

Company ABC is trying to reach more consumers, and in doing so decides to ignore social media and instead focuses on other marketing efforts. Company ABC's decision is logical because social media is slowing and is likely to exert less influence on customer behavior in the future.

Question 21

If marketers want to be listened to by the top executives, they need to translate marketing metrics into finance metrics.

Question 22

The wiggle room between the low, adequate level of expectations and somewhere slightly above the middle, predicted level of expectations is referred to as a "zone of tolerance," which is a range of performance that the customer would be deem acceptable.

Question 23

CRM databases contain the following information: customer contact information, demographics, lifestyle data, and Internet info.

Question 24

Verizon is running two TV ads to attract new customers. Ad A is run once a week and it costs $20 per showing. Ad B is run once a month and costs $100 per showing. The total annual acquisition cost is $2,240.

Question 25

If a current customer becomes dissatisfied, a company should remedy the situation by sending him a free sample, as this is the best way to regain a lost customer.

Question 26

Computing customer lifetime value (CLV) involves three kinds of components: (1) numbers about money, (2) numbers about time, and (3) financing finesse.

Question 27

Gary's Nursery is using a CRM system. Marketer's for Gary's Nursery put significant resources into the CRM,
because the CRM is a core business and the company is customer-centric.

Question 28

Taco Bell uses the RFM matrix to determine its most valuable customers. Recency is weighted at a 5, frequency is weighted at a 4, and monetary is valued at a 3. Customer A has a score of R=2, F=9, M=1. Customer A's RFM score is 49.

Question 29

Tom is a marketer for Ibanez Guitar Inc. He has introduced a new customer loyalty program. The program is resulting in a higher level of customer satisfaction. Tom cannot safely assume that more customer satisfaction will result in a better bottom line.

Question 30

A new technology related to CLV is the use of smartphones for customer loyalty cards, instead of a physical card.

Question 31

The lifespan for "lifetime customer value" is about 80 years.

Question 32

Most customer segments' expectations of quality are not unrealistic.

Question 33

The most desirable customers have low recency, high frequency, and high monetary values.

Question 34

Jody wants to launch a CRM program as a tool her company can use to track spending, and she tells her boss that a CRM program does not need to segment customers into different levels of loyalty, nor does it need to reward certain customers. Jody is correct.

Question 35

When calculating the acquisition cost for a new customer, a company can use the amount redeemed on coupons from past customers.

Question 36

Discount Clothing Store is concerned that it is not satisfying its customers. The firm should consider mapping the
shopping experience in order to fully understand its employees' perspective of how to best serve customers.

Question 37

Hygiene and motivating factors are analogous to core and value-added.

Question 38

When calculating CLV, it is important to get the assumptions correct.

Question 39

Supplemental services typically do not affect satisfaction or dissatisfaction.

Question 40

In calculating customer lifetime value (CLV), time inputs include: (1) a decent guesstimate at the likely retention rate from year-to-year, and (2) a sense of the average lifespan duration for the particular product or brand.

Question 41

For purchases, the comparative evaluation process may be nearly instantaneous, and quickly forgotten.

A) high-involvement
B) quick
C) low-involvement
D) B2B

Question 42

factors are actions that go above and beyond customer expectations.

A) Motivating
B) Hygiene
C) Extra
D) Bonus

Question 43

As Quentin checks out of a hotel, he recalls the expectations of quality and service he had upon arriving at the hotel, and realizes that based on those expectations he is not thrilled with his experience. The type of purchase by Quentin is best described as:

A) quality
B) credence
C) search
D) experiential

Question 44

Susan visits the office of a local attorney to have a will drawn up. She has never hired an attorney before, but thinks that this particular attorney is doing a good job based on his professional demeanor and fancy office. Susan's hiring of the attorney is best described as a purchase.

A) qualitative
B) search
C) experience
D) credence

Question 45

The VP of Customer Experience at an international hotel chain is constantly looking for ways to improve customer service, whether it be at check-in, room service, concierge services, check-out, etc. This is important because customers generally evaluate companies and brands based on .

A) time components
B) search effort
C) points of interaction
D) value-added supplemental components

Question 46

When a consumer does not have much personal experience with a realtor (for example, a first-time home buyer), he will form expectations from .

A) an extrapolation of past experiences with professional service providers
B) newspaper articles
C) his last visit with his doctor
D) an extrapolation of past experiences with service industry staff

Question 47

Marketers hope to convert new customers into each of the following, EXCEPT:

A) satisfied customers
B) frequent purchasers
C) loyal customers
D) full-price customers

Question 48

Mary visits her local shopping mall to purchase some much needed additions to her wardrobe. In selecting the items she wants to purchase, Mary is concerned primarily with factors such as color, size, style, and price. Clothing items can best be described as goods.

A) qualitative
B) search
C) experience
D) credence

Question 49

When we have a situation where we do not have much experience with a brand, we seek people .

A) who are brand ambassadors
B) who are smart
C) who we are related to
D) who we trust

Question 50

Information originating from the marketing mix of a company that contributes to a consumer's expectations may include .

A) positioning claims made in advertising
B) suggestions of quality based on the price of a product
C) trust-worthy data on product quality
D) positioning claims made in advertising and suggestions of quality based on the price of a product

Question 51

Which of the following is a high-involvement purchase?

A) athletic shoes
B) toothpaste
C) oatmeal
D) comb

Question 52

Comparing a purchase to expectations occurs when the item purchased is comprised primarily of characteristics.

A) customer lifetime value
B) search, experience, or credence
C) quality
D) value, price, or quality

Question 53

If the core part of the purchase is .

A) good it decreases satisfaction
B) good it increases satisfaction
C) bad it does not affect satisfaction
D) bad it increases dissatisfaction

Question 54

For purchases, the comparative evaluation process is typically quite deliberative and conscious.

A) high-involvement
B) quick
C) low-involvement
D) B2B

Question 55

Jim and Denise are executives at Jetsetters, Inc., a plane-sharing business. As they review the results of their recent customer satisfaction survey, Jim generally notices that responses fall into three outcomes. Which of the following outcomes is most likely one of the three on Jim's mind?

A) Customer expectations may be confirmed, leading to judgments of satisfaction.
B) Expectations may be disconfirmed in a negative manner if the purchase fell short of expectations, leading to feelings of dissatisfaction.
C) Expectations may be disconfirmed in a positive manner, if the purchase experience surpassed the expectations, leading to feelings of delight.
D) Expectations are not in line with the company's goals

Question 56

What do customers evaluate when making a purchase?

A) core
B) service
C) core and service
D) core, service, and supplemental

Question 57

Marketers don't track customer evaluations because .

A) they know that satisfied customers contribute to the bottom line
B) just because they're interesting
C) new customers become loyal
D) truly loyal customers purchase frequently

Question 58

The comparative evaluation process is thought to operate in which of the following types of purchases?

A) low involvement
B) high involvement
C) both low and high involvement
D) neither low nor high involvement

Question 59

Evan visits a travel website to book a trip to Europe. While he is fairly certain he has selected good flights and exciting destinations, he cannot fully evaluate her trip until he actually arrives. The components of Evan's trip can best be described as goods.

A) qualitative
B) search
C) experience
D) credence

Question 60

The most trusted source of expectations is:

A) word-of-mouth.
B) a consumer's own experience.
C) friends.
D) family.

Question 61

Which of the following is NOT typically in a CRM database?

A) complaints
B) market share data
C) rate of response to marketing offers
D) contact information

Question 62

Scoring models are traditionally comprised of three factors. Which of the following is NOT one of them?

A) high frequency
B) high recency
C) high monetary value
D) high purchase intention

Question 63

When customers become dissatisfied, what is the primary means of regaining the customer?

A) through an empowered frontline employee
B) a free sample
C) a discount
D) through interviews

Question 64

CRM programs are tools used by companies to track spending by collecting information, such as customer identification and contact information, and some form of information on the RFM of the customers' purchase history. What does RFM represent?

A) Recency Frequency Monetary
B) Recency Financial Monetary
C) Retention Frequency Memory
D) Retention Financial Memory

Question 65

The money inputs we need included for CLV include all of the following EXCEPT:

A) estimates of retention costs
B) estimates of acquisition costs
C) estimates of company
D) average contributions for the segment(s) under consideration

Question 66

The time inputs we need included for CLV include .

A) estimates of retention rate and average lifespan of particular product
B) estimates of retention rate
C) average lifespan of particular product
D) average age for the segment under consideration.

Question 67

Chase and Nathan are in charge of tracking customer evaluations for their employer. They are considering which measure to employ to track customer evaluation data. There are many measures that capture customer evaluations to choose from. Which of the following is NOT one of the measures?

A) satisfaction
B) purchase intentions
C) metrics
D) word-of-mouth

Question 68

cultures appreciate the relational aspects of front-line employees more.

A) Collectivistic
B) Pessimistic
C) Individualistic
D) Optimistic

Question 69

Honda offers a line of cars from less expensive to more expensive. What is Honda's goal with regard to this line?

A) the line will extend the customer's lifetime with Honda
B) sales will increase
C) the line will get Honda into new markets
D) the line will create market buzz

Question 70

Bic Inc. has a new ad to attract new customers. This ad is categorized as a(n) .

A) retention cost
B) discount rate
C) average contribution
D) acquisition cost

Question 71

Verizon uses the RFM matrix to determine its most valuable customers. Recency is weighted at a 3, freqency is weighted at a 9, and monetary is valued at a 7. Customer A has a score of R=1, F=5, M=6. What is Customer A's RFM score?

A) 15
B) 31
C) 90
D) 100

Question 72

Lifetime Customer Value assessments involve which three types of components?

A) segmentation, targeting, and positioning
B) numbers about money, time, and financing finesse
C) targeting, retention, and money
D) acquisition, retention, and add-on selling

Question 73

When can marketing become operational?

A) when production is tied to marketing
B) when sales people go on call
C) when implementing plans to create CRM databases
D) when computing CLV

Question 74

Marketers talk of three kinds of expectations. Which of the following is NOT one of them?

A) predicted
B) adequate
C) real
D) ideal

Question 75

is defined as the trade-off of the quality of the purchase received compared with the price paid and other costs incurred.

A) Recovery
B) Marketing
C) Value
D) Expectations

Question 76

Research shows that satisfied customers results in .

A) a better bottom line
B) a more diverse company
C) happier employees
D) word-of-mouth sales

Question 77

Marketers are interested in customers' perceptions, and conduct surveys in order to understand those perceptions. Although these surveys may result in imperfect measures, the numbers do allow marketers to gauge their performance relative to certain , such as past or competitive performance.

A) ideals
B) credence
C) statistics
D) benchmarks

Question 78

Retention rates over time.

A) increase
B) drop
C) remain the same
D) change

Question 79

cultures are more likely to be satisfied when the quality of reliability and service provider responsiveness are strong.

A) Collectivistic
B) Individualistic
C) Optimistic
D) Pessimistic

Question 80

Quality and satisfaction are .

A) not important for a company to be successful
B) interchangeable
C) not the same thing
D) the same