Question 1

The primary benefit of database marketing is:
A)the enhancement of customer loyalty.
B)higher sales.
C)greater profits.
D)greater brand parity.

Accepted Answer

The primary benefit of database marketing is the enhancement of customer loyalty. By leveraging customer data, businesses can personalize their marketing efforts, leading to increased customer satisfaction and loyalty.

Question 2

Successful database marketing emphasizes two things:
A)sales and contribution margin.
B)identifying customers and building relationships.
C)lifetime value of customers and data mining.
D)data mining and data coding.

Accepted Answer

Successful database marketing focuses on identifying customers and building relationships with them. This involves collecting and analyzing data to better understand customer behavior and preferences, and using that information to develop targeted marketing campaigns and personalized communication strategies. While sales and contribution margin are important considerations in any marketing strategy, they are not the primary focus of database marketing. Similarly, while data mining and coding are important tools for collecting and analyzing customer data, they are not the ultimate goal of database marketing. Instead, database marketing is about using customer data to create personalized experiences and build lasting relationships with customers. Lifetime value of customers is also an important consideration in database marketing, as it helps to prioritize marketing efforts and allocate resources more effectively.

Question 3

Common forms of database coding are:
A)data mining and cluster customer analysis.
B)lifetime value analysis,customer cluster analysis,and location-data tracking.
C)lifetime value analysis and data mining.
D)geocoding,data mining and location-data tracking.

Accepted Answer

B

Question 4

The easiest part of building a data warehouse is:
A)data coding through customer cluster analysis and lifetime value calculations.
B)the appended demographic and psychographic information.
C)obtaining the history of customer interactions and contact with a firm.
D)collecting customer names and addresses.

Accepted Answer

Collecting customer names and addresses is the easiest part of building a data warehouse as it only involves basic information gathering. The other options require more complex analysis and data manipulation.

Question 5

A marketing database contains:
A)transactions and interactions individuals have with a firm.
B)information about current customers and customers of the competition.
C)customer transactions and follows accounting principles.
D)information about current customers,former customers,and prospects.

Accepted Answer

A marketing database typically includes information about current customers, former customers, and prospects. This data is used to understand customer behaviors, preferences, and interactions with the company, as well as to develop targeted marketing strategies for different customer segments. The other options may be components of a marketing database, but they do not encompass the full scope of information typically included.

Question 6

The newest form of data analytics is location-data tracking,which is the process of:
A)making the data anonymous so that specific individuals cannot be identified.
B)analyzing data provided by mobile phone GPS technology and combining it with consumer profile information.
C)purging names from a list of individuals who live within a specified area that do not meet a target profile.
D)identifying individuals within a specified location that meet a firm's target audience for a mobile campaign.

Accepted Answer

Location-data tracking involves analyzing data provided by mobile phone GPS technology and combining it with consumer profile information. This allows firms to gain insights on consumer behavior and preferences based on their location, which can be used for targeted advertising and marketing campaigns. Options A, C, and D are not accurate descriptions of location-data tracking.

Question 7

Adding geographic codes to customer records to plot them on a map is called:
A)geoidentification.
B)geocoding.
C)finding neighborhood lifestyle clusters.
D)commercial database service analysis.

Accepted Answer

Geocoding is the process of adding geographic codes to customer records to plot them on a map. Geoidentification, finding neighborhood lifestyle clusters, and commercial database service analysis are not specific processes for adding geographic codes to customer records.

Question 8

The most cost-effective means of communicating with customers is:
A)the telephone.
B)through computer cookies.
C)the mail.
D)the internet and email.

Accepted Answer

The internet and email are the most cost-effective means of communicating with customers due to their wide reach and low cost of delivery. Using email marketing allows businesses to easily track and analyze their customer interactions with the brand, create personalized content, and automate specific actions.

Question 9

Using geocoding,a company's marketing department can add which of the following to each customer's record?
A)Demographic information and lifestyle data as well as the geographical codes
B)Total purchases made at each retail outlet in the area
C)Demographic and political information
D)A composite analysis of his or her neighbors

Accepted Answer

Geocoding can provide the geographical codes (such as latitude and longitude) of each customer's location, which can then be used to add demographic information and lifestyle data to their record. This can help the marketing department understand the customer's preferences, behaviors and interests so they can create more targeted and effective marketing campaigns.

Question 10

Data mining is:
A)collecting addresses and zip codes of customers.
B)reviewing past purchases of a product by customers.
C)building profiles of customer segments and preparing models that predict their future purchase behavior.
D)selecting cities for data analysis.

Accepted Answer

Data mining involves analyzing large datasets to discover patterns and build predictive models, which is described in option C. It's more than just collecting or reviewing data; it's about extracting valuable insights and making predictions.

Question 11

With location-data tracking,the term "hashed" refers to the process of:
A)making the data anonymous so that specific individuals cannot be identified.
B)locating individuals within a specific distance of a specified location.
C)purging names from a list of individuals who live within a specified area that do not meet a target profile.
D)identifying individuals within a specified location that meet a firm's target audience for a mobile campaign.

Accepted Answer

Hashing is the process of converting data into a code that cannot be easily reversed, while still allowing for analysis and comparison. In location-data tracking, this is done to protect the privacy of individuals by making the data anonymous and preventing specific individuals from being identified.

Question 12

An effective database contains:
A)every transaction a customer has with a firm and interactions that resulted in purchases.
B)all transactions and all interactions a customer has with a firm.
C)transactions and interactions of customers that have a high lifetime value.
D)only the transactions of customers.

Accepted Answer

An effective database should contain all transactions and all interactions a customer has with a firm in order to provide a comprehensive view of each customer's behavior and preferences. This information can then be used to personalize marketing efforts and improve customer retention. Option A is too limiting in scope, option C focuses only on high-value customers, and option D does not capture the full picture of a customer's interactions with a firm.

Question 13

A lifetime value analysis creates a figure that represents the:
A)sales revenue generated by a customer throughout his or her lifetime with a brand or company.
B)present value of the profit revenue generated by a customer in a particular product category.
C)present value of the profit revenue of a customer throughout the lifetime of a relationship with a brand or company.
D)profit revenue of a customer throughout his or her lifetime.

Accepted Answer

A lifetime value analysis calculates the present value of the profit revenue generated by a customer throughout the lifetime of a relationship with a brand or company. It takes into account the customer's purchasing behavior, repeat purchases, and potential future purchases. It is a useful tool for companies to determine the value of acquiring and retaining customers. Option A represents sales revenue, which does not take into account the costs incurred to acquire and retain the customer. Option B represents the present value of profit revenue in a specific product category, which does not consider the potential future purchases of the customer. Option D only represents the profit revenue and does not account for the relationship with the brand or company.

Question 14

Many marketing experts believe calculating the lifetime value of a market segment is superior to calculating the value for a single individual because it:
A)is a larger number.
B)is more stable than an individual.
C)adds costs that cannot be allocated per individual.
D)sums costs across a market segment.

Accepted Answer

The answer of Many marketing experts believe calculating the lifetime...

Question 15

The process of building profiles of customers from a firm's database is:
A)data warehousing.
B)direct marketing.
C)location data tracking.
D)data mining.

Accepted Answer

Building profiles of customers from a firm's database is commonly done through data mining techniques, which involves analyzing and extracting valuable information from large sets of data. Data warehousing is the process of collecting and storing data in a centralized location for future use, while direct marketing typically refers to targeted advertising campaigns. Location data tracking involves collecting information about a customer's physical location and movements, which may help with profiling but is not necessarily a core part of the process.

Question 16

Many times demographic and psychographic information about customers is not available through internal company records.In these situations:
A)the information can be purchased from external marketing research firms.
B)a company can offer customers an incentive to provide the necessary information.
C)the database can be appended with interaction and history information.
D)geocoding can be appended to each customer's record.

Accepted Answer

When demographic and psychographic information is not available through internal company records, the best option is to purchase the information from external marketing research firms. These firms specialize in gathering and analyzing data about consumer behavior, attitudes and preferences, and can provide valuable insights to help businesses improve their marketing strategies. Offering incentives to customers to provide information can also be effective, but may not be as reliable or comprehensive as data obtained from research firms. Appending the database with interaction and history information or geocoding can also be helpful, but may not provide the same level of insight into customers' motivations and preferences as demographic and psychographic data.

Question 17

A digital marketing firm tracked the movement of individuals in downtown Chicago just prior and just after a Chicago Cub's baseball game to determine movement,restaurants visited,and stores visited.This illustrates the data analytics of:
A)data mining.
B)customer clustering.
C)location data tracking.
D)geocoding.

Accepted Answer

The scenario described involves tracking the location data of individuals in downtown Chicago before and after a baseball game. This falls under the category of location data tracking, where data analytics is conducted on the movement patterns of people in a specific location over a certain period of time. Data mining and customer clustering involve analyzing data related to customer behavior and preferences, but in this case, the focus is on their physical movements. Geocoding is the process of assigning geographic coordinates to a specific location, which is not explicitly mentioned in the scenario. Therefore, the correct answer is C) location data tracking.

Question 18

In calculating the lifetime value of a market segment,the figures that are the most difficult to obtain are:
A)retention rates.
B)fixed and variable costs.
C)database costs and acquisition costs.
D)marketing and advertising costs.

Accepted Answer

The answer of In calculating the lifetime value of a...

Question 19

In determining lifetime value for individual customers,customer acquisition costs are determined by dividing:
A)advertising costs by the number of customer transactions.
B)total marketing and advertising costs by the number of new customers.
C)total marketing and advertising costs by the number of total customers.
D)advertising costs associated with acquiring new customers by the number of new customers.

Accepted Answer

Customer acquisition costs are calculated by dividing the total marketing and advertising costs specifically aimed at acquiring new customers by the number of new customers acquired. This provides the cost of acquiring each new customer.

Question 20

An operational database contains:
A)transactions and interactions individuals have with a firm.
B)information about current customers and customers of the competition.
C)customer transactions and follows accounting principles.
D)information about current customers,former customers,and prospects.

Accepted Answer

The answer of An operational database contains:
A)transactions and interactions individuals...

Quiz 11: Database and Direct Response Marketing and Personal Selling

The primary benefit of database marketing is:

Successful database marketing emphasizes two things:

Common forms of database coding are:

The easiest part of building a data warehouse is:

A marketing database contains:

The newest form of data analytics is location-data tracking,which is the process of:

Adding geographic codes to customer records to plot them on a map is called:

The most cost-effective means of communicating with customers is:

Using geocoding,a company's marketing department can add which of the following to each customer's record?

Data mining is:

With location-data tracking,the term "hashed" refers to the process of:

An effective database contains:

A lifetime value analysis creates a figure that represents the:

Many marketing experts believe calculating the lifetime value of a market segment is superior to calculating the value for a single individual because it:

The process of building profiles of customers from a firm's database is:

Many times demographic and psychographic information about customers is not available through internal company records.In these situations:

A digital marketing firm tracked the movement of individuals in downtown Chicago just prior and just after a Chicago Cub's baseball game to determine movement,restaurants visited,and stores visited.This illustrates the data analytics of:

In calculating the lifetime value of a market segment,the figures that are the most difficult to obtain are:

In determining lifetime value for individual customers,customer acquisition costs are determined by dividing:

An operational database contains: