CHAPTER 10

Which of the following allows users to log in to the CRM system, simultaneously, from any Internet-enabled computer or mobile device? a) Cloud CRM applications b) Interactive keiretsu system c) Centralized warehousing system d) Multiple-phase cueing system

a) Cloud CRM applications

CRM allows organizations to identify which customers have stopped purchasing products or services so that it can target those former customers for future promotions and/or perhaps investigate why they stopped purchasing in the first place. This CRM attribute is called: a) Customer defection analysis b) Customer-base retention initiative c) Customer profitability determination d) Customer clickstream analysis

a) Customer defection analysis

Which of the following is a CRM tool which can lead to better customer service by giving sales personnel better access to information on contracts, clients, competitors, regulatory issues and laws, sales promotions, and previous client correspondence? a) Knowledge management system b) Sales territory management system c) Warehouse management system d) Trade management system

a) Knowledge management system

Which of the following is NOT an emerging trend in CRM today? a) Personal value creation b) Adopting mobility c) Use of social media d) Use of artificial intelligence

a) Personal value creation

Which of the following is NOT one of the Seven R Rules for customer service? a) Right software b) Right condition c) Right price d) Right product

a) Right software

You work for a company that segments customers by demographic information and markets specifically to those customers who are college graduates. This is an example of: a) Target marketing b) Cross-selling c) Permission marketing d) Personalized customer communication

a) Target marketing

When designing and implementing a successful CRM program firms should do all of the following EXCEPT: a) Use multiple software systems to handle customer-oriented processes b) Provide adequate training for the application users c) Decide on specific performance outcomes d) Encourage employees to buy-in to the idea of using CRM tools

a) Use multiple software systems to handle customer-oriented processes

Data security issues most likely arise when a) Customer information is linked to one central database b) A firm implements various CRM applications without communicating with each department c) The silo mentality is followed d) Customers give false information

b) A firm implements various CRM applications without communicating

The element of a CRM program in which a customer's lifetime value is calculated is referred to as: a) Customer preference determination b) Customer value determination c) Predicting customer behaviors d) Segmenting customers

b) Customer value determination

According to recent research which of the following is NOT one of the top three reasons for customer defections? a) Changes in customer needs b) Customers like to touch and feel the merchandise c) Reduction in product quality/customer service d) The competition offers better prices

b) Customers like to touch and feel the merchandise

One reason CRM programs fail is because: a) Firms are creating strategic alliances b) Firms have diminished efforts to build customer relationships c) Firms have a customer-centric vision d) Company interactions are becoming more automated

b) Firms have diminished efforts to build customer relationships

What is the approximate customer lifetime value of a customer that that generates $1500 (on average) of annual sales? Assume a 7% discount rate, a 25% profit margin, and a customer expected lifetime of 10 years. a) $4741 b) $3556 c) $2634 d) $1863

c) $2634

A hardware store is evaluating several home builders based on their expected lifetime values. Sales to Builder A averages $150, 000 in annual sales, has a 10% profit margin and an expected lifetime of 6 years. Builder B averages $100, 000 in annual sales, has a 15% profit margin and an expected lifetime of 10 years. Which is the more important customer and what is their expected lifetime value? Assume a 9% discount rate. a) Builder A and $67,289 b) Builder A and $96,265 c) Builder B and $96,265 d) Builder B and $67,289

c) Builder B and $96,265

CRM implementation studies have found a direct relationship between program success and _____________. a) Inventory Turnover b) Second tier customers c) Employee involvement d) All of these

c) Employee involvement

Your company asks for customers' birthdates and offers a free meal to celebrate the occasion. This is referred to as: a) Customer preference marketing b) Customer churn c) Event-based marketing d) Permission marketing

c) Event-based marketing

Customer churn occurs when: a) A customer gets tired of waiting and leaves the queue b) A customer sees that the queue is too long, so they don't join the queue c) A customer is no longer profitable d) A customer quits purchasing from a business

d) A customer quits purchasing from a business

Organizations find they must continue to identify and develop innovative ways to _________ customer relationships to maintain a competitive advantage. a) Forecast errors in b) Reduce big data in c) Track signals in d) Add value to

d) Add value to

According to the textbook, CRM system training should be provided ________________ the implementation process. a) Before b) During c) After d) All these are correct

d) All these are correct

Customer lifetime value is used to segment customers based upon their: a) Current profitability only b) Future profitability only c) Neither current nor future profitability d) Both current and future profitability

d) Both current and future profitability

Multiple stand-alone CRM applications throughout the company can result in a) Coordinated efforts to reach active customers b) Increased customer satisfaction c) Better data analysis by managers d) Wasted money and disgruntled customers

d) Wasted money and disgruntled customers