Deck 5: Customer Analysis

Question 1

The term "customer" refers only to those individuals currently interacting with the firm and providing revenue to it through their purchases.

Answer 1

False

Question 2

While no method of describing customers is perfect, AIO variables have proved valuable tools for segmentation and the creation of strategy.

Answer 2

True

Question 3

The firm produces features, but the customer buys benefits.

Answer 3

True

Question 4

The multi attribute model of decision making has proved useful in the final consumer market, but is not practical for the industrial market.

Question 5

A customer defines brand equity as the value of a product beyond that explainable by economic and functional attributes.

Question 6

Conjoint analysis typically employs regression analysis to determine the relative importance of the attributes of a product and the values of different levels of these attributes.

Question 7

Mass customization is an attempt to market products created from mass produced components that have been combined / assembled to meet the unique needs of their buyer / user.

Question 8

Cluster analysis seeks to identify and group individual consumers on the basis of shared behavior variables.

Question 9

Chi-square is a non-parametric statistical technique that has little value in creating / analyzing market segments.

Question 10

Latent class analysis begins with individual customers and then aggregate them.

Question 11

The term "customer" does NOT include

A) Current customers
B) Customers of competitors
C) Customer service
D) Intermediate customers
E) Current noncustomers

Question 12

For consumer products, the person who makes the final decision through budget authorization in the household is known as the

A) Initiator
B) Influencer
C) Decider
D) Purchaser
E) User

Question 13

Also known as lifestyle variable, this descriptive variable represents an evolution from general personality variables to attitudes and behaviors more closely related to consumption of goods and services.

A) Psychographic
B) Personality
C) Demographic
D) Socioeconomic
E) Geo-demographic

Question 14

Organizations that face general needs before the bulk of the industry does and that benefit significantly by obtaining an early solution to those needs are BEST known as

A) Team leaders
B) Lead users
C) Early adopters
D) Entrepreneurs
E) Visionaries

Question 15

The ultimate consumer profile is based on the consumer's

A) Demographics
B) Lifetime value
C) Personality
D) Income
E) Occupation

Question 16

Identify the INCORRECT statement about unprofitable customers.

A) Credit card holders who pay off their balances on time are not unprofitable
B) Unprofitable customers could be cable subscribers in remote areas
C) "High maintenance" customers who heavily use free services may be unprofitable
D) Customers unprofitable in the short run may be very profitable in the long run
E) Firms with high percentages of unprofitable customers are often involved in "slamming."

Question 17

This category of potential customers, based on where they are in terms of relating to the product, involves those who not only buy the product but actively encourage others to do so too.

A) Aware
B) Advocates
C) Attracted
D) Active
E) Accepting

Question 18

The multiattribute model does NOT assume that

A) The customer decision making is occurring in the consumer and not industrial context
B) Customers have a perception about how much of each attribute is contained in a product category
C) Consumers place a weight / importance on each attribute
D) Consumers use some "rule" to combine attributes and weights
E) Products in a product category are a collection of attributes

Question 19

This method, of determining perceptions, provides a spatial representation of the brands in a product category based on customers' perceptions of similarity among products.

A) Chi square test
B) Graded paired comparison
C) Multidimensional scaling
D) Regression analysis
E) Constant sum rating

Question 20

The _____ method to determine customers' perceptions allows the product manager to infer the importance of different product attributes from customer rank orderings of alternative product bundles of attributes.

A) Perceptual mapping
B) Conjoint analysis
C) Multidimensional scaling
D) Feature mapping
E) Balance scorecard

Question 21

The _____ rule of combining attribute information simply multiplies each attribute importance weight by the attribute value and sums these terms for the relevant products.

A) Lexicographic
B) Conjunctive
C) Compensatory
D) Zero-sum
E) Problem solving

Question 22

Identify the rule of combining attribute information that first compares all products on the most important characteristic alone and eliminates those not at the top.

A) Lexicographic
B) Conjunctive
C) Zero-sum
D) Consumptive
E) Consensus

Question 23

This rule, of combining attribute information, assumes the consumer sets minimum cutoffs on each dimension and rejects a product if it has any characteristics below the cutoff.

A) Compensatory
B) Conjunctive
C) Progressive
D) Lexicographic
E) Zero-sum

Question 24

Consumers considering the purchase of a radically new technological product are MOST likely to use

A) Routinized response behaviors
B) Limited problem-solving
C) Technological-aversive behaviors
D) Extensive problem-solving
E) Habitual problem-solving

Question 25

A consumer considering replacing his old Kenmore dishwasher after looking at a couple of other brands and choosing between them is MOST likely to use

A) Routinized response behavior
B) Limited problem-solving
C) Technology-aversive behavior
D) Extensive problem-solving
E) Habitual problem-solving

Question 26

Value of a product to the customer

A) Is always high for costly products
B) Is judged only on the basis of the costs involved
C) Is what the product is worth to the customer
D) Depends only on the benefits offered
E) Is always low for inexpensive products

Question 27

This judgment bias, relevant to marketing, suggests that when individuals do not have strong preferences, they will tend toward a middle choice, i. e., a middle-price, middle-quality product.

A) Losses loom larger than gains
B) Compromise effect / extremism aversion
C) Attraction effect
D) Transaction utility
E) Status quo bias

Question 28

Richard bought a new 4 GB USB flash drive, costing $100, for $85 in a sale. He was extremely happy with his buy and the fact that he had saved $15, even though he did not really require a flash drive. Richard's behavior relates BEST to which of the following biases relevant to marketing?

A) Losses loom larger than gains
B) Compromise effect / extremism aversion
C) Attraction effect
D) Transaction utility
E) Status quo bias

Question 29

_____ can be represented by the premium a customer would pay for one product over another when the economic and functional attributes are identical.

A) Value added tax
B) Market dominance
C) Brand equity
D) Brand attribution
E) Segmentation efficiency

Question 30

Loyalty to a brand is the strongest type of equity and the most beneficial for sellers. It BEST relates to which of the following broad categories of customers thinking and behavior toward a brand.

A) Awareness
B) Association
C) Attitude
D) Attachment
E) Alertness

Question 31

This broad category of customer thinking and behavior toward a brand has the strongest fans of a brand who become advocates, spreading positive word of mouth and encouraging channels to stock the brand as well as participating in brand communities.

A) Awareness
B) Association
C) Attitude
D) Attachment
E) Activity

Question 32

A really new product is LESS likely to succeed if

A) It is adopted by a variety of parties
B) It is not complex
C) Its usage is consistent with the consumers' past behavior
D) It has a relative advantage
E) Its sampling requires major commitment.

Question 33

Using customer responses to estimate the value of a product typically involves direct ratings by customers and may include all of the following approaches, EXECPT

A) Ratings.
B) Balance scorecards
C) Constant sum ratings across brands
D) Graded paired comparisons
E) Conjoint analysis

Question 34

This method for assessing sensitivity to elements of the marketing mix uses the knowledge of managers, the sales force, etc.

A) Expert judgment
B) Customer survey-based methods
C) Experiments
D) Analyses of past data
E) Scanner data

Question 35

The net margin of customer transactions, less any cost attributable to maintaining a particular customer and discounted appropriately over time to current value is the

A) Operational profit of a firm
B) Monetary value of a customer
C) Opportunity cost of a firm
D) Transaction cost of a customer
E) Net worth of the firm

Question 36

Under _____, products and services are marketed to individuals rather than to segments.

A) Mass customization
B) Customized segmentation
C) Segmented marketing
D) Mass production
E) Individual segmentation

Question 37

A good market segment should be all of the following, EXCEPT

A) Sizable
B) Identifiable
C) Reachable
D) Heterogeneous within
E) Coherent

Question 38

_____ analysis examines the values of the variables for each respondent-from a sample of customers-and then groups respondents with similar values.

A) Cluster
B) Tabular
C) Chi-square
D) Cross-tabular
E) Regression

Question 39

This geodemographic system uses census data to examine the means of a set of demographic variables for all U.S. ZIP codes and defines every household in terms of 66 demographically and behaviorally distinct segments.

A) Cluster analysis
B) PRIZM-NE
C) Demographic segmentation
D) ClusterPLUS
E) Hierarchal matrix

Question 40

_____ analysis is used when a marketing manager can specify an explicit relationship between a dependent variable and one or more descriptor variables.

A) Risk
B) ClusterPLUS
C) Regression
D) Ratio
E) Cluster

Question 41

Identify the statistic produced with regression analysis, which measures the degree to which the equation "fits" the data on a 0 to 1 scale, with 1 being a perfect fit.

A) R²
B) Chi-square
C) Zeta
D) Beta
E) T test

Question 42

_____ analysis begins with the whole market--then determines what segmentation pattern best trades off parsimony and the ability to explain behavior.

A) Tabular
B) Regression
C) Cluster
D) Latent class
E) Column

Question 43

Identify the INCORRECT statement pertaining to latent class analysis.

A) It begins with individual customers and then aggregates them
B) It is a relatively recent approach
C) It requires considerable sophistication
D) It is not yet widely employed
E) It may focus on brand switching data

Question 44

Which of the following statement about Judgment-Based Segmentation is NOT true?

A) It is derived by examining statistical data
B) It is often more useful than so-called natural clusters
C) It is a lot like an art
D) It is advisable to use as a basis for comparison with the results of more "data mining" oriented approaches
E) It may produce segments for a market that exists only in the mind of a manager

Question 45

In spite of its lack of statistical sophistication, _____ segmentation is often the most useful approach.

A) Tabular analysis
B) Regression analysis
C) Judgment-based analysis
D) Cluster
E) Latent class

Question 46

Identify the multiple roles, concerning who buys and uses the products, for industrial goods and consumer products. Which of the five possible purchase roles played by the consumer is MOST important to the marketer? Defend your choice.

Question 47

Briefly describe the four bases used in segmenting markets. Which is currently most popular? Why?

Question 48

What is the consumer REALLY buying? How are purchase patterns and product assortment related to the question of what consumers buy?

Question 49

BRIEFLY describe the three sources of consumer value.

Question 50

What role should judgment-based segmentation play in this age of computerized, statistically-driven market analysis?