Many banks and phone companies now charge fees for once-free services to ensure minimum customer revenue levels.This is an example of ________.
A) reducing the rate of customer defection
B) making low-profit customers more profitable
C) enhancing the growth potential for each customer through cross-selling
D) increasing the longevity of the customer relationship
E) focusing disproportionate effort on high-value customers

Question

Quizplus · Accepted Answer

Charging fees for once-free services is a way to make low-profit customers more profitable. By implementing these fees, the company is ensuring that even customers who were previously not generating revenue still contribute to the company's revenue stream. This strategy is aimed at improving profitability by focusing on existing customers rather than acquiring new ones.

Many Banks and Phone Companies Now Charge Fees for Once-Free