Deck 14: Building Customer Loyalty: Customer Relationship Management and Service Strategies

Question 1

The advertisement announced the video store would be open until 10:00 pm. on Friday evenings. When Ned drove to the store to get a copy of the latest Disney video for his daughter's birthday party the next morning, it was only 9:45 pm., but the store was locked up and a sign on the door said the store closes at 9:00 pm. This is an example of a
________ gap.

A) knowledge
B) research
C) performance
D) standards
E) communication

Answer 1

E

Question 2

What happens when the men's department of a store advertises it has someone on staff to do alterations and that person is never available when customers request the service?

A) Reduced customer satisfaction
B) Increased sales
C) Average inventory turnover increases
D) Increased profits
E) Sales promotion becomes more important

Answer 2

A

Question 3

Glamour Shots uses makeup and clothes to try to make each of its customers look attractive. Then it takes photos of these individuals. It makes money by selling these photos. Since each individual is different, each makeover is different as is each camera shoot. Glamour Shots uses a(n) approach to customer service.

A) standardized
B) micro market
C) personalized
D) individualized
E) customized

Answer 3

E

Question 4

Which of the following is an example of a customer service that customers can expect to find in department stores, specialty stores, AND discount stores?

A) Open 24 hours
B) Alterations of merchandise
C) Bridal registry
D) Acceptance of credit cards
E) Personal assistance

Question 5

The most critical step in providing good service is to make sure there is no ________ gap.

A) knowledge
B) research
C) performance
D) standards
E) communication

Question 6

Ivana's service expectations about a gift store she had never been in before would be based predominately on:

A) her most recent retail experience
B) her price/quality perception
C) her word-of-mouth with her friends
D) her experience at other similar gift stores
E) all of her previous shopping experiences

Question 7

"shop" a store to assess the service provided by store employees and the presentation of merchandise in the store.

A) Decile Shoppers
B) Frequent Shoppers
C) Human Resources
D) Mystery Shoppers
E) None of these

Question 8

When Pedro bought his tuxedo, he asked to have the trousers hemmed. When he picked up his pants after they were altered, he noticed the seamstress just folded the pants under and hemmed them rather than cutting the extra material off as they had done in the past. Even though the service had been performed, he believed that it was performed in an unacceptable manner. This is an example of a(n) gap.

A) performance
B) delivery
C) action
D) knowledge
E) education

Question 9

With five children and several nieces and nephews, Bronson has shopped at a lot of toy stores. He really likes The Toy Corner because he can ask for an age specific toy and if they do not have it, they order it and have it delivered at a price he is willing to pay. Bronson feels that The Toy Corner exceeds his:

A) customer expectations
B) perceived service
C) service gap
D) learned response
E) tangible cue

Question 10

From the retailer's perspective, frequent shopper programs offer the following benefits:

A) customers are motivated to increase the amount purchased on each visit
B) customers are motivated to identify themselves at each transaction
C) customers are motivated by the rewards offered to increase the number of visits to the retailer
D) customers provide demographic information when they sign up for the program
E) All of these

Question 11

The two important differences between the service aspect and the merchandise aspect of the retail offering are:

A) flexibility and quality variability
B) planning and control
C) perishability and flexibility
D) intangibility and inconsistency
E) inconsistency and affordability

Question 12

When department stores centralize all buying activities, department managers spend more time working with departmental associates and talking with customers. The result of this is that the company is better able to understand the expectations of the customers. Which of the following service gaps is reduced as a by-product of the centralization?

A) performance
B) research
C) communication
D) standards
E) knowledge

Question 13

Target decides to advertise disposable diapers and display the diapers in store next to "baby food" and "baby wipes". The decision to merchandise these products together may have been the outcome of a:

A) Market basket analysis
B) RFM analysis
C) Segmentation analysis
D) All of these
E) None of these

Question 14

is the set of activities and programs undertaken by retailers to make the shopping experience more special for their customers.

A) Retailing concept
B) Retailing strategy
C) Retailing mission
D) Customer satisfaction
E) Customer service

Question 15

When Tina went to Amazon.ca, based on her past purchases, the site asked her if she was interested in a new book by Deepak Chopra. It also asked her if she wanted to be reminded when new books by Chopra or authors of similar books became available. Tina was even able to review her past purchases. All of these unique customer services enable Amazon.ca to:

A) prevent price comparisons with other electronic retailers of books
B) combat the problems associated with service intangibility
C) differentiate itself from other electronic retailers of books
D) standardize its service offering
E) do all of these

Question 16

A retailer would be reducing the _ _ gap if it reduced the difference between customer expectations and its perception of customer expectations.

A) research
B) knowledge
C) performance
D) standards
E) communication

Question 17

The _ is the difference between customers' expectations and their perceptions of customer service.

A) attitudinal bias
B) service gap
C) learned response
D) motivational guide
E) retail influencer

Question 18

Which of the following is not one of the gaps that are a component of the service gap?

A) delivery gap
B) communication gap
C) performance gap
D) standards gap
E) knowledge gap

Question 19

Providing customer service is an expense to a retailer. What benefit does the retailer receive from incurring the expenses involved in providing good customer service?

A) Generates positive word-of-mouth communication
B) Attracts new customers
C) Current customers return to the store
D) Reduces costs
E) Does all of these

Question 20

When Reba ordered her new side-by-side refrigerator, she expected the people who delivered it to carry it into her kitchen and to connect her ice maker. A ________ occurred when the delivery truck driver left the refrigerator in her front yard.

A) communication gap
B) knowledge gap
C) delivery gap
D) retail gap
E) standards gap

Question 21

Which of the following is the best example of a service goal for a retailer that is sincere about reducing the service gap?

A) "Periodically straighten all merchandise."
B) "Respond to e-mails as soon as possible."
C) "All new inventories should be displayed on racks within 24 hours of its arrival in the shipping area."
D) "Respond positively to all customer complaints."
E) "Approach all customers when they enter the selling area."

Question 22

Drive-through employees at Doug's Tasty Burger are timed to measure how quickly a customer can place an order and receive his or her food. When drive-through employees consistently equal or better the norm, the restaurant manager gives them a $10.00 bonus cheque. The purpose of this type of incentive is to reduce the gap.

A) delivery
B) standards
C) knowledge
D) communication
E) performance

Question 23

The training of employees in how to deal with people, provide better assistance to customers, and explain the use of complex products to potential customers reduces the
________ gap.

A) delivery
B) communication
C) performance
D) standards
E) knowledge

Question 24

An electronic retailer surveys past customers and asks them what kind of information
they needed before making a purchase. It is trying to bridge the
customer research.

A) research
B) knowledge
C) performance
D) communication
E) standards

Question 25

How can retailers reduce the delivery gap?

A) Provide incentives
B) Empower employees to act in the customers' and firm's best interest
C) Reduce conflicts
D) Train employees in the necessary skills and knowledge
E) Do all of these

Question 26

When Hans ordered the model plane for $22 from a hobby catalogue, he was horrified to find that he was charged almost $19 for shipping charges. He swore never to buy anything from that catalogue again. Due to a gap, the catalogue lost a
Customer.

A) research
B) performance
C) knowledge
D) communication
E) management

Question 27

Retailers can reduce the knowledge gap by:

A) listening to customer complaints
B) improving the communication between managers and service employees
C) increasing interactions between retail managers and customers
D) undertaking customer research
E) doing all of these

Question 28

Customers at Harriet's Bookstore complained about how long they had to wait while the sales clerk manually looked up mystery books to see which were available in the store's inventory. Its manager decided to buy a computer and database management program to better manage its inventory. Technology was used to reduce the store's gap.

A) knowledge
B) delivery
C) performance
D) standards
E) communication

Question 29

Service excellence will occur only when:

A) top management is committed to that objective
B) service standards are phrased in generalities
C) employees have been trained on the job
D) management resolves every individual complaint
E) top management has centralized all decision making

Question 30

Which of the following would be the best use of a kiosk?

A) paying new part-time employees until their direct deposit is established
B) informing customers about specific products and their availability in the store
C) comparison shopping with competitors
D) coordinating deliveries with vendors
E) none of these

Question 31

Who is the best person to make sure that high-quality customer service standards are achieved?

A) The marketing manager
B) The advertising manager
C) Individual store managers
D) Salespeople
E) The CEO

Question 32

Six weeks after Simpson purchased six portable computers for his realty business, he was called by the retailer who sold him the computer and asked if he was happy with the purchase, and if there was anything that he would change about the way the store does
Business. The computer retailer was trying to reduce its gap.

A) standards
B) research
C) communication
D) knowledge
E) performance

Question 33

The manager of a university bookstore believes in the importance of having well-stocked shelves. During the first weeks of each semester, the manager hires additional employees, but because she believes that students prefer to wait in line rather than not have the merchandise they need on the shelf, she has the additional employees spend
Their workdays stocking shelves. At busy times during the first week of class, students may wait ten or more minutes to check out because there are not enough clerks ringing up sales. Some students get frustrated and leave without buying. This situation indicates a gap.

A) research
B) performance
C) knowledge
D) standards
E) communication

Question 34

Which of the following can increase a retailer's actual service performance rather than customer's perspective of service?

A) Delivery
B) Knowledge
C) Communication
D) Performance
E) Standards

Question 35

What does a retailer need to do to close the standards gap?

A) A retailer needs to be willing to use technology to standardize certain aspects of their customer service.
B) A retailer needs to be willing to try innovative approaches to service problems.
C) A retailer needs to set service goals.
D) A retailer needs to commit to high-quality service.
E) A retailer needs to do all of these.

Question 36

Mystery shoppers can gather information about:

A) the presentation of merchandise in the store
B) how long it took the salesperson to greet the incoming shopper
C) the attitude the sales clerk used with the shopper
D) how knowledgeable the sales clerk was about merchandise he or she was selling
E) all of these

Question 37

To reduce the delivery gap, retailers need to:

A) increase conflicts
B) avoid empowering its employees
C) train employees in the necessary skills and knowledge
D) provide service that meet minimal standards
E) do all of these

Question 38

Kiosks can be used to:

A) provide routine customer service
B) provide customized solutions for customers
C) help customers to locate merchandise
D) assist customers in learning more information about products
E) do all of these

Question 39

Nina works for a regional department store. At least once a week, she visits a store in the chain and pretends to be a customer. Once she leaves the store, she records her impressions of the store's sales associates and how she was treated. Sales associates who did an above average job handling Nina's sometimes difficult requests receive a small bonus. Nina is a(n):

A) mystery shopper
B) incognito customer
C) retail inspector
D) store employee scanner
E) store observer

Question 40

To reduce its _ gap, the Big Top Sandwich Shop keeps a record of all customer complaints. Each month the employees meet with the manager to discuss techniques to prevent similar complaints from occurring again.

A) performance
B) research
C) knowledge
D) standards
E) communication

Question 41

Lindsay went to the department store to buy thermal underwear for her son stationed in Croatia. The underwear had been featured in an ad for $28.95 a pair. When she arrived at the store to learn it had sold out of the underwear, she was disappointed because the underwear had to be wrapped and mailed that day to reach her son for Christmas. A rain check did not satisfy her. In trying to resolve the problem and make Lindsay happy, the sales clerk was dealing with:

A) evaluative fairness
B) distributive fairness
C) service equity
D) procedural fairness
E) perceptual equity

Question 42

Lu works in the linen department a large department store. When a customer arrived on a Friday morning to pick up a Thanksgiving tablecloth she had special ordered, she was disappointed to find deliveries were late, and the cloth had not yet arrived. She was
Planning to use it at a Thanksgiving gathering at her home this weekend. Lu was able to use empowerment to bridge the gap by offering to bring the tablecloth to her
Home herself as soon as it arrived at the store.

A) performance
B) research
C) delivery
D) communication
E) knowledge

Question 43

An electronic retailer promised a customer that if he or she is dissatisfied with a purchase, returns are quick and easy, but when the purchase is received, there is no
Information on the retailer's return policies or any return instructions. This is an example of a gap.

A) knowledge
B) research
C) communication
D) performance
E) delivery

Question 44

When Zeke purchased his new computer through an Internet retailer, he was promised 24 hours, 7 days a week access to a toll-free number where he could talk to a real-life computer technician. When he had trouble with his computer and needed help, he called the number provided and was put on hold for 45 minutes. When the technician got on the phone, Zeke was told that there were only two technicians on staff who were dealing
With about 150 calls daily. The electronic retailer did not provide for its
Employees.

A) employee empowerment
B) employee incentives
C) internal communications
D) instrumental support
E) information and training

Question 45

What is distributive fairness?

A) The customer's perception of the inequity of the resolution
B) The perceived fairness of the process used to resolve complaints
C) The balanced way of dealing with all customer complaints according to a prescribed format
D) The customer's perception of the benefits received compared to their costs
E) The way store employees can focus on getting the customer back into the store

Question 46

On Tuesday, Jed went to the bakery and ordered a dozen bagels for work. When he got to work, he discovered the bagels were stale and almost inedible. The next morning he stopped by the bakery to complain. Which is the least effective way to deal with Jed's complaint?

A) provide him with a coupon for a free Continental breakfast on his next visit
B) give him a coupon for free coffee now
C) offer him a free replacement dozen bagels
D) give him a $2.00 discount on his next purchase
E) offer him a heartfelt and sincere verbal apology

Question 47

Customer satisfaction is affected by the amount of time it takes to get a question answered or a problem resolved. Retailers can minimize this time by:

A) delegating all handling of complaints to store managers only
B) increasing the number of people the customer deals with so the customer can see how the retailer really cares about revolving his or her complaints
C) using company jargon when dealing with customers so customers can learn about the products that are offered
D) providing customers with clear and precise instructions
E) doing all of these

Question 48

Jared needed to return a textbook because it had missing pages. The sales clerk refunded Jared's money immediately because the refund policies had been carefully explained to her when she started the job. What gap was reduced because of the employee empowerment?

A) Communication
B) Standards
C) Performance
D) Delivery
E) Knowledge

Question 49

The man was obviously unhappy when he came into the store dragging a partially constructed bicycle behind him. He had used the wrong screw to attach a wheel to the bike frame, and when removing the screw, he had broken it off. After satisfactorily
Dealing with the irate customer, the customer service rep's supervisor patted her on the arm and told her what a great job she had done handling a difficult situation. What did the supervisor do to help the customer service representative?

A) Extended internal communications
B) Offered functional support
C) Provided training support
D) Provided emotional support
E) Offered empowerment

Question 50

is the perceived fairness of the process used to resolve complaints.

A) Distributive fairness
B) Perceptual equity
C) Service equity
D) Procedural fairness
E) Evaluative fairness

Question 51

Procedural fairness:

A) only occurs if the company has developed specific guidelines to deal with customers' complaints
B) refers to a balanced way of dealing with all customer complaints according to a prescribed format
C) only occurs when tangible responses are given to customers' complaints and the customer is unhappy with the results
D) refers to the perceived fairness of the procedure used to resolve customers' complaints
E) refers to customers' perceptions of the gains received compared to their inconvenience or loss

Question 52

Customer satisfaction is affected by the amount of time it takes to get a question answered or a problem resolved. Retailers can minimize this time by:

A) listening to the customer
B) providing the customer with clear and precise instructions
C) reducing the number of people the customer must contact
D) doing all of these
E) doing none of these

Question 53

The difference between the service promised and the service actually delivered is the ________ gap.

A) research
B) knowledge
C) performance
D) communication
E) delivery

Question 54

The Lakeside Dog Grooming offered a free flea dip to all of its regular customers. The owner had extra employees to deal with a crowd, but provided only one dip tank, which really slowed down the process. What could the owner do to better deliver the desired service?

A) Empower employees
B) Provide instrumental support
C) Plan information and training
D) Improve internal communications
E) Provide incentives

Question 55

A sales associate who is confronted by a customer whose newly purchased DVD player would not play his DVDs should:

A) take action only after the customer has requested her system be replaced for the second time
B) avoid placing any blame on the store or its employees for the customer's inconvenience
C) tell the customer to relate her complaint to a manager
D) not interrupt the customer's complaint
E) do all of these

Question 56

The night before Willis was checking out of his hotel room, he turned on the television in his room and followed the directions for an automated checkout. Early the next morning, he went to turn in his keys and learned that the front desk was not connected with the televised service, and he had to lose valuable time providing the same
Information again. In this instance, a lack of reduced Willis' satisfaction with
The service received.

A) knowledge
B) instrumental support
C) communication
D) emotional support
E) information

Question 57

Which of the following is an excellent source of information to help a retailer improve its customer service?

A) Competitors' sales
B) Employee handbook
C) External environmental assessments
D) Customer complaints
E) All of these are excellent sources

Question 58

A business philosophy and set of strategies, programs, and systems that focus on identifying and building loyalty with a retailer's most valued customers is called:

A) customer relationship management
B) most valued customer management
C) strategic relationship management
D) customer loyalty management
E) strategic consumer management

Question 59

What are the factors customers consider when they evaluate the resolution of a complaint?

A) The cost and the result desired
B) How it is dealt with and when it is dealt with
C) The price/quality trade-off and degree of fairness
D) Distributive fairness and procedural fairness
E) The severity of the complaint and the importance of the store to the customer

Question 60

Which of the following is a good rule for listening to complaints?

A) Always offer a refund
B) Offer store credit to increase recovery satisfaction
C) Interrupt complaints when you think the customer is repeating herself
D) An apology from the retailer is all that is necessary
E) Allow the customer to complain if she feels she has not been treated properly

Question 61

When Loretta went to Amazon.ca to see if they had any new books about Australian wine, the first thing she saw was a personalized greeting. Which of the following best describes how Amazon.ca knew it was Loretta?

A) She used a password
B) Another retailer sold her private information to Amazon
C) Amazon.ca placed cookies on her hard drive to identify her when she visits the website
D) She ordered before and told them her name
E) Her name is on all of her shipments as well as her address

Question 62

When Marcie purchased some paint for her window frames at The Home Depot, the cashier asked for her telephone number at the point-of-sale. Why did the retailer ask this question?

A) The retailer was identifying her preference
B) The retailer was curious as to how many people from that area code shopped the store
C) The retailer was collecting data for its database
D) The retailer was determining her level of trust in the store
E) The retailer was confirming forecasts for buyers

Question 63

Electronic retailers can collect transaction data for their data warehouse, but they can also collect information by placing cookies on a visitor's hard drive. What is a cookie?

A) Text files that identify visitors when they return to a website
B) A frequent shopper reward
C) Text files that identify pirated software
D) A virus
E) Text files used to determine demographic information

Question 64

In the past, retailers used mass media advertising and price promotions to all customers. Now, they are beginning to provide more value to their best customers using targeted promotions and services to increase their:

A) share of wallet
B) share of mind
C) customer share
D) customer base
E) community share

Question 65

What is the easiest way, of the following, for a retailer that has a CRM program to determine the potential location of new stores?

A) Ask customers where they shop
B) Track sales in stores
C) Distribute customer surveys asking customer store preferences
D) Review the customer database to see where customers live
E) Track Internet sales

Question 66

Tabi has information about a customer that includes what she has purchased, the colours, sizes and styles, and how she has responded to recent promotions. This information is collectively called:

A) a responsive information
B) a customer information
C) demographics
D) a customer database
E) a preferential database

Question 67

Warren uses a Chapters Rewards card, a Blockbuster card, and a HBC Rewards card when he shops at these retailers. Each time he uses them, he is rewarded with reduced cost, free merchandise, or a credit. These cards are examples of:

A) third-party credit cards
B) frequent shopper cards
C) retailer cards
D) identification cards
E) store credit cards

Question 68

After Penny used to analyze patterns in her store's CD sales, she realized that older buyers shopped during the earlier part of the day and younger shoppers visited her shop during the evening.

A) data mining
B) data cloning
C) information drafting
D) redress analysis
E) strategic analysis

Question 69

Which of the following would be considered part of the customer database?

A) A customer's income
B) Whether the customer shopped on the retailer's website
C) A customer's size
D) Whether the customer responded to a recent promotion
E) All of these

Question 70

CRM is based on the philosophy that retailers can increase their profitability by:

A) building better relationships with vendors
B) expanding their services
C) building relationships with their better customers
D) providing better assortments
E) extending hours of operation

Question 71

Why is constructing a customer database potentially more difficult for customers making transactions in the stores?

A) Store purchases with cash can be anonymous
B) Customer returns to the store confound the data
C) Availability of store assortments is not always similar to website assortments
D) Store customers are not interested in sharing personal information
E) None of these

Question 72

Why are concerns about privacy acute for customers who use the electronic channel while they shop?

A) Consumers are concerned about their credit card security
B) Consumers are concerned as to how the information is shared
C) A large amount of information can be collected without the consumer's knowledge
D) Electronic retailers ask for more information than necessary for a simple transaction
E) All of these

Question 73

A retailer wants to collect information about its customer purchases so that it can suggest appropriate products to its customers, but the retailer does not want to raise privacy concerns among its customers. Which of the following should it do?

A) Allow consumers to view and correct any personal information held by an online retailer
B) Tell consumers what information they are collecting
C) Ensure that the information is held securely and is not passed on to other companies
D) Give customers a choice as to whether they give information
E) All of these

Question 74

Canada's new Privacy Act changes the way companies collect, use, or disclose customer information. Which of the following is NOT one of the principles upon which the act is based?

A) Retailers must obtain consent from consumers prior to passing on their personal information to third parties
B) A retailer does not need consent for the collection, use, or disclosure of personal data
C) Retailers must keep personal information on consumers as accurate and up-to-date as possible
D) How a retailer plans to use customer data must be identified at the time of collection of the customer's information
E) Retailers must make customers' personal information available upon their request

Question 75

Although most retailers use their customer data analysis to identify target markets, less than half use it to:

A) identify their best customers
B) identify the assortments most commonly purchased
C) identify the managers who have the least turnover
D) predict their share of wallet
E) identify customer demographics

Question 76

During exam week, Herbert changed the menu in his restaurant to include more comfort food, after he used and learned that although students are health conscious
Most of the year, they tend to desire "Mom's cooking" during times of stress.

A) strategic analysis
B) information cloning
C) benefit analysis
D) affinity analysis
E) data mining

Question 77

Since Jill had the opportunity to utilize , she now places pizza cutters by the pepperoni, refrigerated croissant dough by the butter, birthday candles by the cards and the cake mixes.

A) market basket analysis
B) grocery cart analysis
C) shopping basket analysis
D) merchandising analysis
E) shopping cart analysis

Question 78

The first step in the CRM process is:

A) developing CRM programs
B) identifying the target customers
C) implementing CRM programs
D) constructing a customer database
E) analyzing data

Question 79

Which of the following best describes the type of data analysis that focuses on the composition of the bundle of products purchased by a household during a single shopping occasion?

A) Merchandising analysis
B) Shopping cart analysis
C) Shopping basket analysis
D) Grocery cart analysis
E) Market basket analysis

Question 80

Which of the following best describes a lifetime customer value (LTV)?

A) LTV is an assessment of how many valued customers shop with a retailer
B) LTV is the value placed upon a retailer by a consumer
C) LTV is what retailers use to rate the value of guaranteed merchandise
D) LTV is a numerical value of how much a "best customer" shops
E) LTV is what a customer contributes to a retailer's profits over her lifetime