Ch 13 - 15

Many companies find themselves in the position of having to manage expectations downward

true

Convention hotels provide meeting rooms and banquet hotels to convention participants. Sometimes a specific convention may involve 2000 members or only 75 members. To take care of both sizes of groups, convention hotels have movable walls that allow them to extend or contract a facility as needed by the group. By modifying its facility, the convention hotels are able to:

Adjust capacity to match demand

Shelton Elementary School only needs its gymnasium from Monday through Friday. On the weekends it rents the facilities to an Upward Bound basketball program sponsored by a local church. By renting its facilities, the elementary school is:

Adjusting capacity to match demand

In talking to a travel agent, T.J. Matthews learned that he would have to pay the same amount of money for a three-day/two-night package right outside the gates of Walt Disney World for his family of four as he would for a five-day/four-night stay at a hotel that was about 50 miles away from Walt Disney World. Matthews decided the farther hotel was a much better value. Matthews define value as:

All that I get for all that I give

Waiting time feels longer when customers:

Are alone while waiting

When a service firm's resources are fully employed, but not overused; and customers are receiving quality service in a timely manner, the firm is operating _____ capacity.

At optimum

Internet service providers that offer subscribers their choice of hook-up speed and type spam blockers are:

Creating tiered-value service offerings

A service firm is underutilizing its labor, equipment and facilities when:

Demand is below optimum capacity

Which of the following approaches to pricing considers that customers may judge on the basis of price?

Demand-based pricing

Which of the following is NOT a strategy for adjusting capacity to match demand

Differentiating on price

A more complex type of integrated marketing communications is needed for goods than for services

False

If a company's goal is to manage customer expectations, it should avoid offering service guarantees

False

It is impossible to manage customer expectations in a business-to-business situation?

False

Research indicates that yield management approaches are most appropriate when a service is targeting one large market segment.

False

Accountants, architects, interior decorators, marriage counselors and lawyers typically use a _____ pricing strategy.

Fee for service

Mass transit train and bus service has peak periods of demand Monday through Friday during morning and evening rush hours. Demand for mass transit service:

Follows a predictable demand cycle

Service providers should never encourage word-of-mouth communication

false

The lack of inventory capability in services is due to which of the following characteristics of service?

Perishability and simultaneous production and consumption

Because most people like to get tattoos and body piercings on the weekends, a tattoo parlor in Portland, Maine, offers a reduced rate Monday to Thursday for all of its services. Prices on Friday and Saturday are 45 percent higher than they are during the rest of the week. The tattoo parlor is using a(n) _____ pricing strategy.

Synchro-

American Airlines BreakAway fares offer travelers substantial savings on nonstop flights from Newark, New Jersey to Los Angeles from mid-August to mid-October. The round-trip airfare is $299 for customers who depart on Friday and return the following Monday or Tuesday. American Airlines is using a(n) _______ differential.

Time

A concert production that charges less for matinee shows than for its evening performances is shifting its demand to match capacity by differentiating on price.

True

An insurance company that used advertising showing satisfied customers thanking the company for their prompt payment after a flood would be addressing service intangibility

True

Any company that disseminates information through different communications channels needs to be concerned with integrating this information so that customers receive unified messages and promises about its offering.

True

Once the sale is made, service provider can manage customer education by clarifying expectations after the sale.

True

Overuse or under use of service can directly contribute to provider gap 3 - failure to deliver what was designed and specified.

True

Search cost are the cost invested to identify and choose from services you desire

True

Since customers naturally look for price anchors, as well as familiar services, against which to judge focal services, price framing is an appropriate strategy to us for pricing many types of service

True

The three types of complementary pricing are:

Two-part pricing, captive pricing and loss leadership pricing

Which of the following is NOT a type of differential used by service providers to synchronize demand and supply

Utility

Which of the following is NOT an effective pricing strategy to use when customers define value as "low price"

Value pricing

Which of the following is NOT a company controlled factor that influences customer expectations?

Word-of-mouth communication