Question 1

Which of the following strategies would a company most likely use to increase customer satisfaction?

Accepted Answer

Lowering prices is a common strategy used by companies to increase customer satisfaction. Customers tend to value products and services more if they are priced lower than competitors or if the company offers discounts and promotions. Lower prices can also attract new customers who may have been hesitant to purchase from the company before. This can lead to increased sales and revenue for the company. However, it's important to note that lowering prices should not come at the expense of quality or profitability. Companies must carefully consider the impact of lowering prices on their bottom line and ensure that they can still maintain a high level of customer satisfaction while remaining financially sustainable.

Question 2

A room upgrade offered by a hotel to a guest who often stays in the hotel is an example of ________.

Accepted Answer

A frequency marketing program is designed to reward and retain customers who make repeated purchases or frequent visits to a business. Offering a room upgrade to a guest who often stays in the hotel is an example of a frequency marketing program. By providing a better experience to the guest, the hotel can increase the likelihood that the guest will continue to choose their hotel for future stays, leading to increased revenue and customer loyalty.

Question 3

The final step in the marketing process is ________.

Accepted Answer

The final step in the marketing process is capturing value from customers, which involves creating a profitable exchange relationship with customers by delivering superior customer value and satisfaction. This means that the company must create a customer-driven marketing strategy that meets the needs and wants of the target market, design a marketing mix (product, price, place, and promotion) that delivers superior value to customers, and then effectively communicate and deliver that value to customers.
Creating customer delight and customer lifetime value are important goals of the marketing process, but they are not the final step. Understanding the marketplace is an important first step in the marketing process, but it is not the final step. The final step is capturing value from customers by delivering superior customer value and satisfaction.

Question 4

The primary key to delivering customer satisfaction is to match product performance with ________.

Accepted Answer

The primary key to delivering customer satisfaction is to meet or exceed customer expectations. It is essential to understand what the customer wants, needs, and expects from a product or service. By aligning the product's performance with customer expectations, a company can create a positive customer experience and increase the likelihood of customer satisfaction. This can lead to repeat business and positive word-of-mouth recommendations. Competitive products, pricing, advertising, and customer services are all important factors, but meeting customer expectations is the most critical aspect of delivering customer satisfaction. The primary key to delivering customer satisfaction is to match product performance with customer expectations. Understanding and meeting the needs and wants of customers is essential to building a successful business. By aligning product performance with customer expectations, businesses can increase customer satisfaction, loyalty, and advocacy. This requires an ongoing effort to gather feedback, understand customer needs, and continually improve products and services to meet those needs. Focusing on customer expectations can help businesses differentiate themselves from competitors, build brand loyalty, and increase revenue through repeat business and positive word-of-mouth referrals. Customer satisfaction is achieved when the product or service meets or exceeds customer expectations. Thus, the primary key to delivering customer satisfaction is to match the product's performance with the customer's expectations. It is essential to understand what customers expect from the product or service and then deliver accordingly. This requires companies to conduct market research, gather feedback from customers, and continuously improve their products or services to meet changing customer needs and expectations. Focusing on competitive product performance, pricing, aggressive advertising, or limited customer services may be important factors for success, but they are not the primary key to delivering customer satisfaction. The primary key to delivering customer satisfaction is to match product performance with customer expectations. Customers have certain expectations when they purchase a product or service, and if the product or service meets or exceeds those expectations, then they are more likely to be satisfied with their purchase. Therefore, understanding and meeting customer expectations is crucial for delivering customer satisfaction. Competitive products, prices, and advertising can be important factors as well, but they are secondary to the customer's perception of the product's performance relative to their expectations. Additionally, limited customer services can lead to frustration and dissatisfaction, further emphasizing the importance of meeting customer expectations.

Question 5

Elisandra, a marketing manager at a regional chain restaurant, has decided to organize a contest calling for customers to create commercials for the restaurant. Winning entries will be posted on the organization's home page. Elisandra's plan is an example of ________.

Accepted Answer

Elisandra's plan to organize a contest calling for customers to create commercials for the restaurant is an example of consumer-generated marketing. This type of marketing involves encouraging customers to create content related to a brand or product and sharing it on social media or other channels. By organizing this contest, Elisandra is tapping into the creativity and enthusiasm of her customers to help promote the restaurant. This approach can be very effective as it generates authentic and relatable content, and it also fosters engagement and loyalty among customers.

Question 6

The marketing world is most likely embracing ________ because consumers wield greater power now with many platforms for airing and sharing their brand views with other consumers.

Accepted Answer

Customer-managed relationships refer to the shift from companies controlling the communication and interactions with customers to customers taking an active role in managing their relationships with companies. With the rise of social media and other platforms, consumers now have greater power to share their opinions about brands with other consumers, and this has led to a greater emphasis on customer-managed relationships in the marketing world. Companies are now focused on building relationships with customers based on trust, transparency, and responsiveness to customer feedback in order to meet their needs and exceed their expectations. This approach recognizes that customers are not passive recipients of marketing messages but are active participants in the marketing process, and it is essential for companies to engage with customers in a meaningful way to build loyalty and drive growth.

Question 7

Customer equity refers to ________.

Accepted Answer

Customer equity refers to the total combined customer lifetime value of all of the company's current and potential customers. It takes into account the value of current customers as well as the potential value of future customers. Customer equity is an important metric for measuring the long-term value of a company's customer base and for making strategic decisions about marketing, sales, and customer service. It is calculated by multiplying the average customer lifetime value by the number of current and potential customers.

Question 8

At Gina's retail stores, the posted policy reads, "Without our customers, we don't exist." Gina and her staff aim to delight each customer, and they are quick to offer discounts or extra services whenever a customer is anything less than satisfied. Gina and her staff strive to make every customer a repeat customer. It is most accurate to say that instead of focusing on each individual transaction, Gina and her staff put a priority on ________.

Accepted Answer

Gina and her staff's focus on delighting customers and making them repeat customers indicates that they prioritize capturing customer lifetime value over each individual transaction. By providing exceptional service and discounts, they aim to create loyal customers who will continue to patronize the store in the long term, rather than just making a one-time sale. This approach aligns with the idea of customer relationship management, which emphasizes building long-term relationships with customers to maximize their lifetime value to the business.

Question 9

A gym equipment manufacturer encourages customers to become members of the firm's Web site. Membership provides customers with exercise tips as well as discounts on gym equipment and workout apparel. This is an example of ________.

Accepted Answer

A club marketing program is designed to create and maintain long-term relationships with customers by offering them special benefits and rewards. In this case, the gym equipment manufacturer is encouraging customers to become members of its website, which provides them with exercise tips as well as discounts on gym equipment and workout apparel. By doing so, the manufacturer is creating a community of loyal customers who are likely to continue purchasing its products over time. This approach is characteristic of a club marketing program, which is focused on building customer loyalty and repeat business. A frequency marketing program, on the other hand, typically rewards customers for making frequent purchases, while consumer-generated marketing involves customers creating and sharing their own marketing content. The basic customer relationship approach is simply focused on building a basic level of trust and understanding with customers, while the selling concept is focused on aggressively promoting products regardless of customer needs or preferences.

Question 10

Which of the following marketing strategies should marketing managers focus on to manage detailed information about individual customers and carefully manage customer touchpoints to maximize customer loyalty?

Accepted Answer

Customer relationship management (CRM) involves managing detailed information about individual customers and managing customer touchpoints to maximize customer loyalty.

Question 11

"Losing a customer once means losing the entire stream of possible purchases that the customer would make over an extended period of patronage." This statement specifically indicates loss in terms of ________.

Accepted Answer

The statement "Losing a customer once means losing the entire stream of possible purchases that the customer would make over an extended period of patronage" highlights the concept of customer lifetime value (CLV). Customer lifetime value is the total amount of money a customer is expected to spend on a company's products or services during the entire duration of their relationship with the company.
When a customer is lost, the company not only loses the immediate revenue from that customer but also the potential revenue from all future purchases that the customer would have made had they remained loyal. This is why it's crucial for companies to prioritize customer retention and ensure that they're providing a positive customer experience to keep customers coming back.
Option A, customer-perceived value, refers to the perceived value that customers derive from a company's products or services. While customer-perceived value is important for attracting and retaining customers, it's not directly related to the concept of losing a customer and the subsequent loss of future revenue.
Option B, marketing offerings, refers to the various products, services, and promotions that a company offers to customers. While marketing offerings can certainly impact customer retention, they don't directly relate to the concept of losing a customer and the subsequent loss of future revenue.
Option C, partner relationship management, refers to the management of relationships with a company's partners, such as suppliers, distributors, and vendors. Partner relationship management is not directly related to the concept of losing a customer and the subsequent loss of future revenue.
Option E, value proposition, refers to the unique value that a company's products or services provide to customers. While a strong value proposition can certainly help attract and retain customers, it's not directly related to the concept of losing a customer and the subsequent loss of future revenue. Customer lifetime value (CLV) refers to the total value that a customer is expected to generate over their entire relationship with a company. This includes all the purchases that a customer is likely to make, as well as any additional revenue that may be generated through referrals or word-of-mouth advertising.
The statement suggests that losing a customer means losing out on all the potential revenue that they would generate over their lifetime. This highlights the importance of retaining customers and building long-term relationships with them. By focusing on CLV, companies can make better decisions about how to allocate their marketing and customer service resources, and how to prioritize customer retention efforts.

Question 12

Hank is an assistant marketing director for a firm in a market with many low-margin customers. What type of relationship with these customers would be the most profitable for him?

Accepted Answer

Basic relationships are most profitable in markets with many low-margin customers because they require less investment and resources compared to full partnerships, which are more suitable for high-margin customers.

Question 13

Greater consumer control means that companies can no longer rely on ________.

Accepted Answer

Greater consumer control refers to the increasing power of consumers to choose which products and services they want to buy, how they want to receive information about them, and how they want to interact with companies. This shift in power means that companies can no longer rely on marketing by intrusion, which involves pushing advertisements or messages to consumers without their consent or interest.
Instead, companies must focus on marketing by attraction, which involves creating market offerings and messages that involve and engage consumers, and promoting brand-consumer interaction. They must also develop marketing concepts with an outside-in perspective, which means they must understand and respond to consumer needs and desires rather than simply promoting their products or services.
In summary, the correct answer is B) marketing by intrusion, as it is no longer an effective or ethical approach in today's consumer-centric marketplace.

Question 14

Through ________, companies today are strengthening their connections with all partners, from providers of raw materials and components to those involved in the delivery of final goods and services.

Accepted Answer

Supply chain management involves the coordination and management of all activities involved in the creation and delivery of a product or service, from raw materials and components to final delivery to the end customer. As such, it encompasses all partners in the supply chain, including suppliers, manufacturers, distributors, and retailers. Through effective supply chain management, companies can strengthen their connections with all of these partners, ensuring that each partner is performing optimally and that the entire supply chain is functioning efficiently. This can lead to cost savings, increased customer satisfaction, and improved overall performance. Direct marketing, customer relationship marketing, and customized marketing are all focused on the customer, rather than on the broader supply chain. Inventory management is a component of supply chain management, but it does not encompass all partners in the supply chain.

Question 15

Building and maintaining profitable customer relationships by delivering superior customer value and satisfaction is called ________.

Accepted Answer

Customer relationship management (CRM) refers to the process of building and maintaining long-term profitable relationships with customers by delivering superior customer value and satisfaction. This involves understanding customer needs and preferences, and using that information to develop and implement strategies to meet those needs and exceed customer expectations. CRM helps businesses to acquire new customers, retain existing ones, and increase customer loyalty and advocacy, all of which contribute to improved customer lifetime value and customer equity. Customer-perceived value, customer lifetime value, and customer equity are all related concepts that are important in the context of CRM, but CRM is the overarching strategy that encompasses all of these concepts. Partner relationship management, on the other hand, refers to the process of building and maintaining relationships with business partners and suppliers, and is not directly related to CRM.

Question 16

________ is determined by a customer's evaluation of the benefits and costs of a market offering relative to those of competing offers.

Accepted Answer

Customer-perceived value is the value that customers perceive they receive from a product or service, based on their evaluation of the benefits and costs relative to competing offers. This value is subjective and varies from customer to customer, as different customers may place different weights on different benefits and costs. Therefore, companies must understand their customers' needs and preferences and design their offerings to meet or exceed these expectations. By delivering superior customer-perceived value, companies can build customer loyalty and gain a competitive advantage in the market.

Question 17

Sally recently purchased Brand X lotion. In comparing her perception of how the lotion made her skin feel and look to her expectations about Brand X lotion, Sally was measuring her level of ________.

Accepted Answer

Sally is assessing her level of customer satisfaction by comparing her actual experience with the lotion to her initial expectations of it.

Question 18

Kao Corp., a deodorant manufacturer, invited teenage girls to make an ad that would encourage other girls to buy the product. This program is an example of ________.

Accepted Answer

Consumer-generated marketing involves involving customers in the marketing process, such as inviting them to create ads or engage in social media campaigns. In this case, Kao Corp. is inviting teenage girls to create an ad that will encourage other girls to buy their deodorant product, which is an example of consumer-generated marketing. This approach can help companies build stronger relationships with their customers by giving them a voice and a role in the marketing process. It also allows companies to tap into the creativity and insights of their customers, which can lead to more effective and authentic marketing messages.

Question 19

It is most accurate to say that when customers purchase products they act on ________ as they judge values and costs.

Accepted Answer

When customers purchase products, they act on their perceived value of the product. Perceived value is the perceived benefit a customer receives from a product or service compared to its cost. This value is subjective and varies from customer to customer, based on individual needs, preferences, and expectations.
Customers consider a range of factors when assessing perceived value, including product features, quality, price, and convenience. They may also consider factors such as brand reputation, social status, and emotional connections.
While objective value, customer lifetime value, company image, and society's interests may influence customer behavior to some extent, perceived value is the most accurate determinant of customer behavior. Customers ultimately make purchasing decisions based on how they perceive the value of a product or service relative to its cost.

Question 20

Which of the following terms refers to customers who make repeat purchases and tell others about their positive experiences with a product or service?

Accepted Answer

Customer evangelists are customers who are extremely satisfied with a product or service and are enthusiastic about sharing their positive experiences with others. They are loyal customers who continue to make repeat purchases and also serve as advocates for the brand, promoting it to others. They are important for companies because they can help increase brand awareness and attract new customers through word-of-mouth marketing. The other options are not relevant to the definition of customer evangelists.

Quiz 1: Marketing: Creating Customer Value and Engagement