Deck 12: CRM Program Measurement and Tools

Question 1

An acquisition/defection matrix indicates

A) Which type of customer is entering and leaving
B) Which VAN members are short vs. long term
C) Who a company is losing their customers to and gaining them from
D) The relationship between satisfaction scores and retention
E) None of the above

Answer 1

Who a company is losing their customers to and gaining them from

Question 2

When computing the benefits of CRM or "what did we get in return?", experience indicates

A) Given today's scientific measures, it is quite easy
B) This is the one area of CRM that all companies consistently dp
C) There are 5 key effectives measure everyone agrees on
D) It is much easier for small companies than for large companies
E) All the above are false.

Answer 2

All the above are false.

Question 3

Useful measures of the effectiveness of customer retention efforts do not include which of the following?

A) Average defection rate
B) Average lifetime value
C) Survival rate
D) Yield rate
E) All are useful measures of retention efforts

Answer 3

Yield rate

Question 4

When companies want to determine how effective their CRM methods have been in developing closer bonds with their customers, they often do it by

A) Using behavioral proxies for psychological variables
B) Measuring retention
C) Monitoring the number of customer complaints
D) All of the above
E) All of the above except C and D

Question 5

Useful measures of how successful a company has been in developing closer bonds include

A) Measures of overall loyalty
B) Measures of yield rate
C) Capture rate ratios
D) All of the above
E) Only A and B

Question 6

Of 100,000 customers who were active in 2005, 60,000 are still active in 2006. The maverage retention rate is

A) It can't be determined since the initial 100,000 have not been segmented into cohorts.
B) 40%
C) 1 × .9 × .6 = 54%
D) 60%
E) None of the above

Question 7

List some useful measures of customer acquisition effectiveness.

Question 8

List some useful measures of cross-selling and up-selling effectiveness.

Question 9

List some useful measures of customer retention effectiveness.

Question 10

Frederick F. Reichheld holds a strong belief regarding the relationship between customer satisfaction and customer retention. What is his belief?

Question 11

Customers assess service quality on 5 dimensions. Briefly describe each dimension.

Question 12

How can the SERVQUAL instrument be used by an organization?

Question 13

Define "size of wallet" and "share of wallet" and give an industry example.

Question 14

What is the importance of SCLV?

Question 15

What is CLV, and what are its components?

Question 16

Why should firms calculate CLV and customer equity?

Question 17

Very often customers change their buying behavior before defecting. Consequently, many companies have developed leading indicators of customer defection. What are these leading indicators that are often forerunners of defection?

Question 18

Construct an acquisition/defection matrix and explain it.