Which of these is a true statement about the customer acquisition funnel?
A) People can't reach the advocate stage without become buyers.
B) Customers do not necessarily go through all five stages.
C) The steps only occur in a linear fashion.
D) The appeal stage is the first stage of the funnel.
E) The act stages is the last stage of the funnel.

B

What are "spinners" in the context of customer acquisition and retention?
A) Buyers who change their mind multiple times
B) Buyers who argue with salespeople
C) Consumers who switch suppliers frequently looking for the best deal
D) Consumers who "spin" marketing messages to their own taste
E) Opinion leaders in social media

C

In the customer acquisition funnel model, buyers who recommend a product to others have reached the ________ stage.
A) awareness
B) appeal
C) ask
D) act
E) advocate

E

If you text a friend for advice on choosing from three restaurants you have in mind for dinner tonight, have reached the ________ stage of the customer acquisition funnel.
A) awareness
B) appeal
C) ask
D) act
E) advocate

C

Consumers who have "shortlisted" the most favorable-looking offerings currently under consideration have reached the ________ stage of the customer acquisition funnel.
A) awareness
B) appeal
C) ask
D) act
E) advocate

B

If you dump your mobile service provider after three billing errors in a row, you ended your loyalty because of a ________.
A) core service failure
B) pricing issue
C) competition
D) convenience
E) service encounter failure

A

What does research suggest about the relative cost of retaining current customers versus acquiring new customers?
A) Retaining current customers can cost several times as much as acquiring new ones.
B) Acquiring new customers can cost several times as much as retaining current ones.
C) Acquiring new customers costs slightly more than retaining current ones.
D) Acquiring new customers costs slightly less than retaining current ones.
E) Acquiring new customers costs roughly the same as retaining current ones.

B

Which of these could explain a situation where the percentage of recent users of a particular product is significantly lower than the percentage of shoppers who have tried the product?
A) Delivery delays prevent recent buyers from actually using the product.
B) Something might be wrong with the product that discourages repeat buying.
C) Advertising has failed to remind people of the wisdom of buying the product.
D) There isn't enough social media buzz about the product.
E) Social media buzz is hyping the product heavily.

B

Satisfied customers constitute the company's ________.
A) customer relationship capital
B) customer churn
C) target audience
D) high-value customers
E) customer touch points

A

Some customers inevitably become inactive or drop out. The challenge for marketers is to 1 them through ________ strategies.
A) win-back
B) retention
C) defection
D) sell-out
E) recuperation

A

Which of these is NOT one of the major sources that customers use to form expectations of the level of satisfaction they will receive by doing business with a company?
A) Past buying experience
B) Advice of friends and associates
C) Government guidelines
D) Public information and discourse
E) Information and promises from marketers and competitors

C

________ programs are a type of promotional incentive designed by companies to encourage customers to continue to patronize their business and, in some case, to increase the frequency and quantity of the products and services they purchase from a company.
A) Coupon
B) Loyalty
C) Communication
D) Discount
E) Advertising

B

A(n) ________ is specialized group of consumers and employees whose identification and activities center revolve around the brand.
A) brand community
B) customer club
C) insiders' club
D) frequency flyer club
E) company alumni

A

Which of these would NOT be considered a brand community?
A) SAP Community Network
B) My Starbucks Idea
C) CVS customers in the northeast
D) Sephora Beauty Talk
E) Microsoft Xbox Ambassadors

C

Which of these is NOT a recommendation for making online brand communities more effective?
A) Enhance the timeliness of information exchanged.
B) Have a company insider moderate all comments before they are posted to ensure civil discourse.
C) Enhance the relevance of information posted.
D) Extend the conversation, including making it easier for users to express themselves.
E) Increase the frequency of information exchanged.

B

According to the chapter, which of these techniques does Deere & Company use to maintain its superb record of customer loyalty?
A) Using a PR agency to boost its image among homeowners and commercial users
B) Using database marketing to personalize offers
C) Using retired employees to interview defectors and customers
D) Monitoring social media to see who might complaining about its products
E) Inviting customers to join John's Club to get special insider information

C

Which of these is NOT noted in the chapter as a benefit of high customer satisfaction?
A) Lower advertising costs
B) Stronger ROI
C) Increased sales
D) Long-term firm value
E) Other financial metrics

A

What does the University of Michigan's ACSI survey measure?
A) Corporate profitability
B) Customer satisfaction
C) Customer churn rate
D) Distributor satisfaction
E) Supplier satisfaction

B

The percentage of a customer's spending that a company's brand enjoys is known as its ________.
A) unit market share
B) share of voice
C) share of wallet
D) revenue market share
E) market position

C

Which of these is NOT one of the typical behaviors of a highly satisfied customer?
A) Staying with a company longer
B) Buying new and upgraded products from the company
C) Being less sensitive to price
D) Offering product and service ideas to the company
E) Requiring more in terms of discounts or special sales attention

E

Which of these was NOT a step Home Depot took to turn around its slumping customer satisfaction?
A) Requiring all employees to do nothing but serve customers during peak hours
B) Changing performance reviews to emphasize customer service
C) Emphasized cleaner retail spaces
D) Emphasized fully stocked store shelves
E) Replacing thousands of full-time workers with part-time employees

E

Which of these is a true statement about customer satisfaction for customer-centric companies?
A) Customer satisfaction is both a goal and a marketing tool.
B) Customer satisfaction happens naturally, with little management oversight.
C) Customer satisfaction has only a minor impact on long-term customer loyalty.
D) Marketing employees don't have much of a role in customer satisfaction.
E) Companies can safely ease off customer satisfaction efforts once they have achieved long-term customer loyalty.

A

How was Kia able to successfully enter the highly competitive U.S. automobile market?
A) With an advertising blitz touting the unusual style of the cars
B) With low-cost, high-quality cars reliable enough to carry 10-year, 100,000-mile warranties
C) With high-quality cars brimming with luxury features
D) By emphasizing its national heritage
E) By launching the Kia Owners Club to recruit new drivers

B

________ has been defined as "a deeply held commitment to rebuy or repatronize a preferred product or service in the future despite situational influences and marketing efforts having the potential to cause switching behavior."
A) Customer commitment
B) Fanaticism
C) Loyalty
D) Brand community
E) Brand trust

C

Which of these is NOT one of the identified ways that marketing employees contribute to product and service quality?
A) They correctly identify customer needs and requirements.
B) They design products that fill clearly researched customer needs.
C) They make sure customer orders are filled correctly and on time
D) They check that customers have received proper instructions, training, and technical assistance in the use of the product.
E) They stay in touch with customers after the sale to ensure that they are, and remain, satisfied.

B

________ can be defined as a deeply held commitment to rebuy or repatronize a preferred product or service in the future despite situational influences and marketing efforts having the
potential to cause switching behavior.
A) Value proposition
B) Loyalty
C) Satisfaction
D) Respect
E) Customer value

B

Total customer satisfaction is measured based on the relationship of ________.
A) expected value and total customer benefit
B) perceived performance and expectation
C) advertised outcomes and real outcomes
D) past experience and present experience
E) customer attitude and salesperson's attitude

B

________ can track customer satisfaction directly, measure repurchase intention and also gauge a consumer's willingness to recommend the company and brand to others.
A) Periodic surveys
B) Mystery shoppers
C) Customer loss rates
D) Customer focus statements
E) Sales summary reports

A

Field Grocery wants to learn the strengths and weaknesses in customer service at all the Field Grocery stores. Which of the following methods can it use for this?
A) Group buyers
B) Buyer brokers
C) Mystery shoppers
D) Personal shoppers
E) Buying agents

C

________ is the totality of features and characteristics of a product or service that bear on its ability to satisfy stated or implied needs.
A) Performance
B) Value
C) Quality
D) Customer retention
E) Customer loyalty

C

Cable TV operators and cellular carriers are among the companies that suffer from high levels of ________.
A) customer retention
B) customer defections
C) detraction
D) share-of-wallet
E) customer reevaluation

B

Which of the following is NOT a way to make online brand communities more effective?
A) Set appointed times for topic discussion
B) Keep the focus on the topic
C) Make it easy for users to express themselves
D) Launch contests
E) Set limits on length of responses

E

Which of the following can a company do to reduce defection?
A) Attract new customers to try out the company's products.
B) Increase customer lifetime value by increasing the non-monetary costs of products.
C) Enhance the growth potential of existing customers through cross-selling and up-selling.
D) Distinguish the causes of customer attrition and identify those that can be managed better.
E) Make low-profit customers more profitable or terminate the relationship.

D

Companies provide rewards to customers who buy often and in substantial amounts. These reward schemes are referred to as ________ programs.
A) benefit
B) loyalty
C) satisfaction
D) profitability
E) quality

B

Which of the following gains the most benefit from introducing a frequency program?
A) The first company to introduce a frequency program in an industry
B) The fast follower, the second to introduce a program in an industry
C) The industry sales leader
D) The niche player in the industry
E) The low-cost leader in the industry

A

Club membership programs that are open to everyone who purchases a product or service ________.
A) are more powerful long-term loyalty builders than limited-membership clubs
B) will not help a company attract customers from competitors
C) prevent those with only a fleeting interest in a company's products from joining
D) are useful for building a database of customers but are not very good as long-term loyalty builders
E) are useless unless there are fees and membership conditions

D

Southwest Airlines offers a Rapid Rewards program that allows customers to count flights they have taken toward free future flights. This is an example of a(n) ________.
A) cross-selling program
B) value delivery system
C) loyalty program
D) activity-based costing program
E) up-selling program

C

Which of these was NOT identified in the chapter as a popular strategy for enhancing customer relationship management?
A) Customization
B) Customer empowerment
C) Shunting troublesome customers to competitors
D) Managing customer word of mouth
E) Dealing with customer complaints

C

________ is the practice of marketing to consumers only after they have indicated their willingness to receive communications from a company.
A) Permission marketing
B) Social marketing
C) Social commerce
D) Interactive marketing
E) Acceptance marketing

A

Today's consumers can choose whether and how they want to engage with company marketing, a phenomenon known as ________.
A) permission marketing
B) social marketing
C) customer empowerment
D) social commerce
E) two-way marketing

C

Which of these is a way that negative reviews of their products can help a company?
A) Consumers may learn a product is not right for them before ordering it, which lowers the cost of returns.
B) Negative reviews show that the product is real.
C) Negative reviews help "humanize" a company; after all, everybody makes mistakes from time to time.
D) Negative reviews give product evangelists the opportunity to challenge naysayers.
E) Consumers know to ignore complainers, so negative reviews actually make them feel more positive toward a company.

A

Why is it a good idea for companies to use social media and other platforms during quiet times to actively shape their public images?
A) Paid media are cheaper during these quiet times.
B) Doing so builds goodwill that can help firms in the event of a public relations crisis.
C) Social media users pay more attention to brands during quiet times.
D) These quiet times give social media teams the chance to practice their skills.
E) With few companies communicating during quiet times, it's easy to increase a firm's share of voice.

B

Which of these is NOT one of the recommended ways to recover customer goodwill?
A) Make it easy for customers to reach the company at any time.
B) Contact the complaining customer as quickly as possible.
C) Be sure to resolve every situation to the customer's satisfaction, regardless of the cost.
D) Identify the true source of customer dissatisfaction before seeking a solution.
E) Accept responsibility for the customer's disappointment.

C

Which of these is a safe assumption to make about dissatisfied customers?
A) Few will have legitimate reasons for complaining.
B) Many will have been "put up to it" by competitors.
C) The vast majority will take the time to complain.
D) Many won't complain and will simply take their business elsewhere.
E) Once they complain, the firm has lost the opportunity to keep them as customers.

D

If a customer has a complaint but the company solves it quickly, what are the odds that the customer might do business with the firm again?
A) Less than 10 percent
B) 10 to 20 percent
C) 25 percent
D) 50 percent
E) 95 percent

E

How did Angie's List avoid attracting anonymous or biased reviews?
A) By requiring all reviews to be notarized.
B) By allowing only paid and registered subscribers to access the website.
C) By requiring reviews to disclose their full purchase histories.
D) By rewarding top reviewers with cash prizes.
E) By requiring members to write five reviews before they were allowed to post.

B

Of customers who register a complaint, ________.
A) all will do business with the company again because they are unwilling to dedicate the effort required to find another vendor
B) none will do business with the company again
C) customers whose complaints are satisfactorily resolved are more likely to provide publicity than those who are dissatisfied
D) the speed of resolution has no impact on the likelihood of repeat business
E) 50 to 70 percent might do business with the company again if their complaint is resolved

E

Which of the following is one of the best methods of recovering customer goodwill?
A) Sending service people to conduct door-to-door surveys
B) Contacting the complaining customer as quickly as possible
C) Identifying prospective customers from the customer database
D) Customizing products according to individual customer need
E) Defining and measuring the customer retention rate

B

The aim of customer relationship management is to maximize customer ________.
A) integrity
B) loyalty
C) innovation
D) liability
E) equity

B

________ is the process of carefully managing detailed information about individual customers and all customer touch points to maximize loyalty.
A) Customer relationship management
B) Customer lifetime value
C) Customer profitability analysis
D) Customer satisfaction analysis
E) Customer-value delivery

A

Customer relationship management enables companies to provide excellent real-time customer service through the effective use of ________.
A) reports from mystery shoppers
B) survey data from customers who have defected
C) market research
D) individual account information
E) demographic trend data

D

________ marketing is based on the premise that marketers can no longer use "interruption marketing" via mass media campaigns.
A) Relationship
B) Permission
C) Database
D) Internet
E) Horizontal

B

________ marketing is the practice of sending messages only when consumers express a willingness to become more involved with the brand.
A) Relationship
B) Permission
C) Cause
D) Defensive
E) Horizontal

B

A ________ is an organized collection of comprehensive information about individual customers or prospects that is current, accessible, and actionable for lead generation, lead qualification, sale of a product or service, or maintenance of customer relationships.
A) customer database
B) customer mailing list
C) customer-performance scorecard
D) customer profitability analysis
E) customer-value hierarchy

A

________ describes the company's optimization of the value of its customer base.
A) Customer relationship management
B) Behavioral targeting
C) Customer value management
D) Terminal marketing
E) Personalized mark

C

________ focuses on the analysis of individual data on prospects and customers to develop marketing strategies to acquire and retain customers and drive customer behavior.
A) Permission marketing
B) Customer value management
C) Behavioral targeting
D) Customer relationship management
E) Terminal marketing

B

BMW is ________ the customer experience when it offers 500 side-mirror combinations, 1,300 front bumper combinations, and 9,000 center-console combinations and provides new
buyers a video link to watch their car being "born" while waiting for delivery.
A) identifying
B) synthesizing
C) integrating
D) acknowledging
E) personalizing

E

To exploit the power of social media, marketers need to create tangible value for consumers, which can come from all of the following EXCEPT ________.
A) discounts
B) coupons
C) information
D) solicitations
E) special offers

D

________ helps companies manage and monitor online reviews using a process called device fingerprinting.
A) Gawker
B) Bazaarvoice
C) Metacritic
D) Angie's List
E) Technorati

B

A Forrester study of 10,000 consumers of Amazon's electronics and home and garden products discovered that ________ found negative reviews helpful.
A) few
B) less than 10 percent
C) around 25 percent
D) 50 percent
E) 90 percent

D

________ involves making the company's offering as personally relevant as possible to as many customers as possible—a challenge, given that no two customers are identical.
A) Customization
B) Permission
C) Identification
D) Database
E) Integrated

A

Another term for customer lifetime value is ________.
A) brand equity
B) customer value
C) customer equity
D) unit market share
E) revenue market share

C

Which of these is NOT a component of customer lifetime value?
A) Revenue
B) Customer acquisition costs
C) Customer retention costs
D) Research and development costs
E) Customer support costs

D

Which of these firms would most likely take a customer equity perspective over a brand equity perspective?
A) A fashion designer
B) A health and fitness club
C) An automobile manufacturer
D) A cereal manufacturer
E) A soft drinks manufacturer

B

Which of these is a key to effectively employing activity-based costing?
A) Defining and judging "activities" properly
B) Knowing each customer's brand preferences
C) Having a detailed breakdown of advertising media costs
D) Not putting a price on customer satisfaction
E) Merging sales and support activities, since they both contribute to satisfaction

A

Which of these firms would most likely take a brand equity perspective over a customer equity perspective?
A) A health club
B) A management consulting firm
C) An advertising agency
D) A fast food chain
E) A home builder

D

A profitable customer yields a ________.
A) cost stream that exceeds by an acceptable amount his revenue stream
B) revenue stream that exceeds the company's cost stream
C) cost stream that exceeds the company's revenue stream
D) revenue stream that exceeds by an acceptable amount his cost stream
E) revenue stream that equals the company's cost stream

B

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.
A) prospector
B) profitable customer
C) market challenger
D) niche marketer
E) pioneer customer

B

Customer profitability analysis is best conducted with the tools of an accounting technique called ________.
A) input-output analysis
B) factor analysis
C) revenue-based costing
D) activity-based costing
E) future date costing

D

Which of the following is true for activity-based costing?
A) It considers the real costs associated with each product.
B) With activity-based costing, the company can estimate all costs coming from the customer, less revenue.
C) The tools of activity-based costing 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.

C

________ describes the net present value of the stream of future profits expected over the customer's lifetime purchases.
A) Activity-based costing
B) Customer lifetime value
C) Customer value analysis
D) Customer-perceived value
E) Customer profitability analysis

B

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

B

Many banks and phone companies now charge fees for once-free services to ensure minimum customer revenue levels. This helps banks to ________.
A) reduce the rate of customer defection
B) make low-profit customers more profitable
C) enhance the growth potential for each customer through cross-selling
D) increase the longevity of the customer relationship
E) focus disproportionate effort on high-value customers

B

Sapphire Toys actually sells more than toys. It also sells branded clothing, music CDs, and books for children. This expansion of dealership sales offerings is an attempt to increase the value of the customer base by ________.
A) reducing the rate of customer defection
B) increasing the longevity of the customer relationship
C) enhancing the growth potential of each customer through cross-selling
D) making low-profit customers more profitable
E) terminating low-profit customers

C

Which of the following is an example of enhancing the growth potential of each customer through cross-selling?
A) In addition to bicycles, 2Wheels stocks biking gear such as helmets, bottles, jackets, and other accessories.
B) 2Wheels has a club for its regular customers, organizing cycling events and parties for them.
C) Though 2Wheels previously offered free delivery, it now charges for deliveries made outside the city.
D) 2Wheels allows existing customers to upgrade to a newer model at less than the sticker price by trading in their older model.
E) 2Wheels encourages customers to send in their suggestions for product improvement.

A

Which of the following is a policy a store can adopt to make low-profit customers more profitable?
A) 2Wheels sends birthday greetings to its best customers and gives them discounts on merchandise.
B) 2Wheels has a club for its regular customers, organizing cycling events and parties for them.
C) Though 2Wheels previously offered free delivery, it now charges for deliveries made outside the city.
D) 2Wheels allows existing customers to upgrade to a newer model at less than the sticker price by trading in their older model.
E) 2Wheels encourages customers to send in their suggestions for product improvemenT

C

A customer ________ is any occasion on which a customer encounters the brand and product—from actual experience to personal or mass communications to casual observation.
A) touch point
B) point of order
C) point of difference
D) pivot point
E) point of parity

A

A customer touch point for Abacus Airlines would be an item such as ________.
A) ease of access to the airport
B) a mechanic's ability to service the airplanes
C) the reservations desk
D) the value of air travel versus surface transportation
E) competency of a travel agent

C

Rachel and Josh are on vacation in Hawaii. When they arrived at the hotel, they were offered chilled juice. Their check-in formalities were handled by the staff. When they entered their room, they saw that chocolates had been placed on the pillows and a flower arrangement on the table. These are examples of customer ________.
A) lifetime value
B) perceived value
C) value analysis
D) profitability analysis
E) touch points

E

In the context of customer lifetime value, the 80-20 rule reflects the idea that ________.
A) 20 percent of the company's profits are generated by the top 80 percent of customers
B) the top 20 percent of customers are highly satisfied and 80 percent of customers will recommend the company to a friend
C) 20 percent of customers are unprofitable, and 80 percent make up a company's profits
D) the top 20 percent of customers often generate 80 percent of the company's profits
E) any new product will be accepted by 20 percent of the customers immediately, but 80 percent of the customers will be up for grabs throughout the product's life cycle

D

The Net Promoter Score is calculated by subtracting ________ from ________.
A) promoters; detractors
B) detractors; promoters
C) detractors; passively satisfied customers
D) passively satisfied customers; detractors
E) passively satisfied customers; promoters

B