Customer Relations in Business
Examples of customer-specific behaviors include all of the following EXCEPT:
A marketing copywriter develops a brochure aimed toward 30-something suburban mothers and mails it out to all who fit that specific profile
The following are best practices for loyalty programs EXCEPT:
Always err on the side of customer privacy over customer insight
Customer relationship management (CRM) is best characterized as:
An enterprise-wide strategy
Which of the following is true?
An interconnected world both requires and produces trust.
According to Stephen M.R. Covey, trust includes:
Character and competence
Competitive advantage in using customer information means outperforming rivals in each of the following steps except:
Collaborating
The two kinds of customization that provide the greatest competitive advantage are:
Collaborative and transparent
For "Interactive Age" companies, competitive advantage is primarily based on:
Customer information
Which of the following questions is NOT a Golden Question?
Do you eat out at restaurants more than once a week?
The document governing privacy protection in Europe is:
European Union Data Protection Directive
According to Philip Kotler, the following shifts have occurred as companies move from mass marketing to customer-focused marketing EXCEPT:
From direct contact with end users to reliance on efficient intermediaries
The four levels of business relationships are:
Intimate, face-to-face, distant, and no-contact
Which of the following statements is true about using satisfaction as a proxy for measuring loyalty?
Loyal customers are likely to be satisfied, but not all satisfied customers will be loyal.
The greatest competitive advantage in managing employees in a customer-strategy organization lies in:
Making the most talented employees more productive.
The natural buy-in phase for management seeking the best value is:
On Main Street
Using Legos as an example, which of the following would be a product benefit?
Recognizable make-believe situations
The second stage in the evolution of CRM software is:
SaaS CRM
In Charles Green's trust equation, the element that outweighs all the others is:
Self-Orientation
Which of the following describes a customer-share strategy?
Selling as many products as possible to one customer at a time
Analytical CRM includes the following:
Software installations
____________ allows companies to treat different customers differently.
The feedback loop
What should be the primary goal of frequency marketing programs?
To accumulate customer information by encouraging purchasers to identify themselves
A business relationship is mutual, interactive, iterative, and _________.
Unique
The 1-9-90 dynamic is most akin to:
a power law distribution
The goal of value differentiation is:
a predictive plan of action
Which is the most relevant customer strategy for research & development?
accessing real-time customer information
The authors predict the next stage of customer analytics will involve:
applying financial characteristics to data analysis
For the customer service department, when considering self-service options for customers, what is the best approach?
balancing CSR contact and self-service
Creating maximum customer value requires:
balancing short-term value with long-term value
"Benefits" differ from "needs" in that:
benefits are based on the product
Which of the following companies would benefit least from creating value streams?
bookseller
When listening to customer conversations online, the primary things to monitor are:
brand and customer
The picket fence strategy is best suited for:
businesses who already identify customers individually and differentiate them by value
Segment management is best suited for:
businesses who do not yet identify or differentiate their customers individually
Preparing customer data for analysis (the analysis process) includes which of the following steps?
classification, estimation, regression, prediction, and clustering
According to Paul Greenberg, which business model best takes into account the phenomenon of "social customers"?
collaboration
One tool that helps leverage community knowledge is:
collaborative filtering
In the interactive age, ___________ drives the central engine of competition.
customer information
RFM (recency, frequency, and monetary value) is a useful proxy for:
customer lifetime value
The difference between what customers want and what they're willing to settle for is:
customer sacrifice
Value harvesters are companies whose:
customer value rate is below their cost of capital
Which of the following characterizes mass customization (vs. mass production)?
demand chain management
The blogs that draw the most readers tend to have all of the following characteristics except:
employees that mostly post about products
According to Marijo Puleo, a customer-strategy organization's first investment should be in:
establishing a customer-centric vision
The primary goal of marketing in the context of interaction is:
generating feedback from the customer
A customer's value to the enterprise is a function of the profit the customer generates:
in the future
Social media has resulted in all of the following except:
increased capacity to deceive
Gupta and Lehmann's customer equity study showed that customer equity was measurably impacted most by:
increasing customer retention rates
All of the following are factors in defining customer equity except:
increasing service costs per customer
The two categories of business concerns about privacy are:
individual privacy and data security
What technique helps customization reduce a company's all-in costs?
modularization
Which of the following is NOT a likely financial benefit of using social media?
more influence in offline referrals, leading to more deal closings
According to Seth Godin, the most valuable commodity is:
permission marketing takes advantage of new technology better than interruption marketing
A customer-based enterprise must learn to balance both privacy and:
personalization
All of the following agreements would likely ease the sales department's transition except:
phasing out the use of sales force automation software
The three different dimensions of a customer's experience include:
physical, emotional, logical
The value a customer could create for the enterprise, if the enterprise made the right offerings at the right time, is:
potential value
Customer analytics provides what missing link for understanding customers?
prediction
Customer equity includes the LTV of:
present and future customers
According to the case study presented in Chapter 12, Verizon Wireless discovered which of the following benefits from customer analytics?
reduced marketing costs
Legacy metrics include all of the following EXCEPT:
return on customer
The metric that measures how well an enterprise is using customers to create short-term and long-term value is:
return on customer
One of the challenges in a sales department's transition to customer strategy is:
sales reps' work becomes more visible
The following are examples of addressable media EXCEPT:
television
A customer's contributions to an enterprise could include the following except:
using an online service rather than a call center
Which of the following actions are NOT likely to increase customer trust?
using an opt-out policy
The two fundamental differences between customers are:
value and needs
"Customer needs" are best defined as what the customer:
wants or prefers from the company
The average percentage of users who participate in an online community is:
10%
On average, an American shopper has to choose among _______ times as many products as he actually buys.
100
All of the following represent lifestyle changes relevant to predicting LTV change except:
A customer signs up for an e-mail newsletter.
Which of the following best expresses the role of emotion in business relationships, as described by the authors?
A relationship does not always have an emotional connection, and an emotional connection does not always indicate a relationship
Attitudinal data is:
Adaptive data
Keeping long-term customers is more beneficial than continually acquiring new customers because:
All that is listed
The core benefit of Learning Relationship for an enterprise is:
All that is listed
According to Jim Barnes, the following quality does NOT define a genuine business relationship:
Behavior
The primary objective of the IDIC process is:
Building a customer's trust
Which of the following are NOT identification tasks?
Collaborate
Creating a customized product for a customer through dialogue with that customer is known as:
Collaborative customization
Which stage in the relationship development process depends on the factors of inputs, consistency, and durability?
Commitment
Which of the following relationship building blocks are considered to be the two primary?
Commitment and trust
Which statement is true about opt-in and opt-out policies?
Consumer groups favor opt-in, while industry groups favor opt-out.
One way to summarize the seemingly contradictory data about consumer privacy attitudes is:
Consumers want both maximum convenience and maximum privacy.
For management seeking to fix a broken, mission-critical business process, the natural buy-in phase for new technologies is:
Crossing the Chasm
One primary economic asset of an enterprise is:
Customer information
Which of the following statements is not true about customer needs?
Customer portfolios are the best way to differentiate by needs.
According to the Pareto principle:
Customer value is best represented by a log-normal distribution curve.
The fourth implementation task in the IDIC implementation model is:
Customize
Establishing a trusting relationship in which a customer freely shares information with an enterprise will likely involve all of the following approaches EXCEPT:
Ensuring the customer database is updated at least weekly
The 5 Es of customer relationship are:
Environment, expectations, emotions, experience, engagement
Which customization activities would most likely increase a customer's long-term value?
Expanding the need set
Which stage in the relationship development process is the most fragile?
Expansion
The highest level of consciousness in the development of the organization is:
External cohesion
According to Rashi Glazer, smart markets are blurring boundaries between:
Firm and competitor
What are some reasons companies do become customer-centric?
Focusing on customers will ensure every transaction is profitable
The customer-centric company would gather customer information by:
Gathering customer-specific information AND aggregate information
Traditional marketing's "Four Ps" apply to which part of the "Get, Keep, and Grow" customer strategy?
Get
In the "relational" type of business relationship described by Julie Edell Britton, which best characterizes the interest of buyer and seller, respectively?
High and high
The core benefit of a Learning Relationship for a customer is:
Higher quality products
The "action" aspect of the IDIC model includes:
Interact and Customize
Barnes suggests a company evaluate a customer's experience on each of the following levels except:
Likelihood to refer to others
For a B2B company, what method would likely NOT help identify end users?
Linking all customer data across departments, particularly for front-line employees
The mass production of goods and services in lot sizes of one is known as:
Mass customization and Mass configuration
Which statement best characterizes the relationship between needs, behavior, and customer value?
Needs drive behavior, and behavior drives value.
Which of the following would be a reliability enhancer?
Never asking a customer to input an ID number if he will be asked for it again later in the call
Which of the following is not a "trust myth" described by Charles Green
People like to be listened to
Which of the following conditions have not contributed to more companies seeking to become trusted agents for their customers?
Personalization
For "Industrial Age" companies, competitive advantage is primarily based on:
Product innovation and brands
In customer-strategy companies, capabilities managers are most akin to:
Product managers
If an enterprise ranked low in tailoring for customers but high in customer interaction, it would find itself in which quadrant of Peppers and Rogers' Enterprise Strategy Map?
Quadrant III: Database Marketing
Which of the following aspects would be part of a customer's enhanced need set?
Related products or services
What is the biggest obstacle for most companies making the transition to becoming a customer-strategy enterprise?
Relationship governance
In the behavioral definition of customer loyalty, customer loyalty ________ brand preference.
Results from
Which of the following industries would have the most difficulty differentiating customers by needs?
Software designers
The following are reasons some companies have resisted becoming customer-centric except:
Some believe that customers are scarce
The organization that endorses each customer's control of his own information and identifies groups and companies that meet its privacy protection requirements is:
TRUSTe
An enterprise's best first step to identifying customers is:
Take an inventory of all customer data available in any electronic format
Which of the following companies would most likely have the easiest time recognizing customers at every interaction?
Telecommunications companies
Which of the following are NOT true of a company engaged in genuine dialogue with a customer?
The customer should control the dialogue.
Which of the following are one of the computer's "three awesome powers," as identified by Stan Rapp?
The power to compare
Internally generated data would include:
Transactional data
A trusted agent does all of the following except:
Understands that customer information is a primary economic asset and will use that information to ensure maximum profitability for the company
According to Dov Seidman, all of the following are true about rules except:
We feel strongly about rules.
All of the following are key questions for a company transitioning to a customer-strategy enterprise except:
What authority will the chief executive have to change how the enterprise treats customers individually?
The performance of the truly outstanding companies is characterized by:
a series of short-term competitive advantages
All of the following are ways a customer-strategy enterprise might meet the goal of maximizing the customer base except:
acquiring as many new customers as possible
Illustrating the importance of the customer as financial asset, Amazon's Jeff Bezos has said that he prioritizes spending on all of the following except:
advertising
In the transition to a customer-strategy enterprise, the human resources department plays all of the following roles except:
aligning technology implementation with business strategy
Complaining customers are valuable to a company because of their:
all that is included
Failing to align supply-chain management with demand-chain management results in:
all that is listed
Which of the following could be considered a company's customers?
all that is listed
According to Eric Beinhocker, the economy is best characterized as:
an evolutionary system
Requiring a customer to do something beneficial for the company, and then rewarding the customer for that action, is:
an implicit bargain
According to Seth Godin, the most valuable commodity is:
attention
For those building the value of the customer base in a company, privacy means all of the following EXCEPT:
avoiding litigation
An effective Future State Touchmap takes into account all of the "best practices" EXCEPT:
collecting as much customer information as possible
According to George Day, two approaches to gaining a relationship advantage include:
comprehensive solution management and customer relationship management
Another term for contributing to open source projects is:
crowd service
From the enterprise's perspective, unrealized potential value depends upon all of the following except:
current product or service usage
One new function of the transitioning customer-strategy marketing department is:
customer analytics
Losing a customer's business due to circumstances beyond a company's control is referred to as:
customer attrition
What primarily drives the success of mass customization?
customer collaboration
The net present value of the expected future stream of financial contributions for the customer is:
customer lifetime value
From the customer's perspective, potential value depends upon:
customer need
The core structure of the customer management organization is:
customer portfolio management
Customer relationship managers will be directly responsible for:
customer portfolios
The purpose of customer analytics is:
develop a deeper relationship with the customer
Creating a "front door" for a company's Web site is an example of:
differentiating customers by needs
According to the authors, the metaphor of "data mining" captures all of the following EXCEPT:
discovering real-time insights into the nature of individual customers
Companies that maintain their innovative edge find a balance between:
exploration and exploitation
Transitioning to a customer-strategy organization is best done:
gradually
An effective Current State Touchmap includes all of the following aspects EXCEPT:
graphical illustration of the enterprise's internal structure
Businesses that benefit most from community knowledge:
have routine interactive communications with customers
All of the following behaviors should characterize customer relationship managers except:
keeping departmental boundaries intact while generating enterprise-wide results
According to Pelin Turunc, the pharmaceutical industry discovered high referral value in:
key opinion leaders
Pilot projects are ideal for:
large businesses
The customer experience dimension addressed by a Touchmap is:
logical
A group of customers with similar attributes is a:
market segment
Customers create long-term value because they have __________ .
memories
Which of the following types of customer profiles would help a company define a customer's needs?
need-based
The dialogue information of most interest to a company pertains to a customer's:
needs and potential value
All of the following are points to consider in creating a privacy pledge EXCEPT:
none that is listed
To best leverage information about a customer's needs, the next step after accumulating information about the customer is:
organizing and analyzing the information
Extensive surveys indicate that people's single most trusted source is:
peers
Traditional measures of financial success emphasize:
prioritizing short-term value over long-term value
Which of the following have increased the importance of trust in today's marketplace?
privacy policies
"Dirty" data can mean all of the following except:
private
The demand chain includes all of the following except:
production
According to the authors, what common interest do enterprises and customers now share in the context of privacy?
protecting customer information
An enterprise seeking to create an online community to encourage crowd service would likely do all of the following EXCEPT:
provide economic rewards for participating
Customer interaction is the responsibility of:
sales, marketing, customer service, and upper management
When recruiting super-users, the most effective rewards will be:
social and free products
The customer-strategy enterprise will focus on growing the following customer value categories:
super-growth customers and MGC
The actual economic value of any business enterprise can measured in terms of:
the discounted net present value of the future stream of cash flow
Which of the following reasons help explain why companies tend to focus on short-term performance?
the investment community's obsession with short-term performance and companies feel powerless to change
What two events have most significantly shaped current Western attitudes toward privacy?
the rise of social media and the 9/11 terrorist attacks
In a customer-strategy enterprise, what is the primary reason to use social media?
to build customer relationships
Once we identify customers, a customer-strategy enterprise will differentiate them in order to:
treat different customers differently
Predictive modeling includes all of the following steps except:
using transactional data to calculate LTV retrospectively
What characteristic dictates most whether a company would benefit from customer analytics?
whether the company generates large amounts of customer-specific information
Needs represent the __________ behind a customer's actions.
why and how
