Deck 21: Customer Relationship Management (CRM)

Question 1

Empowerment in a CRM environment is normally a process of collecting customer information through customers' feedback on products.

Answer 1

False
This is learning.Empowerment is the delegation of authority to solve customers' problems quickly.

Question 2

The interaction between a customer and the organization is the foundation on which a CRM system is built.

Answer 2

True

Question 3

Privacy issues are the primary reason for centralizing data in a CRM.

Answer 3

False
Customer data is centralized in a CRM system not for privacy reasons,but to actually to make it available throughout the organization.

Question 4

RFM analysis is used to delete unnecessary or duplicated data.

Question 5

Customer relationship management (CRM)requires that organizations be organized around customer segments.

Question 6

Data consolidation is an analytical process that compiles actionable data about the purchase habits of a firm's current and potential customers.

Question 7

For a CRM system to be effective,customer information must be stored in a data matrix.

Question 8

Volvo has a Web site that caters to car enthusiasts who might want to see concept cars evolve into real-life products.Volvo would likely have used data mining to locate people who were car enthusiasts and innovators.

Question 9

Channel interactions are the relationships a manufacturer has with its distributors.

Question 10

Customer-centric is an internal management philosophy similar to the marketing concept.

Question 11

Multinational companies often face difficult problems when pulling together internal data about their customers.

Question 12

Janie contacts calls Lands' End to ask if the company sells pajamas for teenage girls.The customer service representative who speaks with Janie advises her of the various options.This is an example of knowledge management.

Question 13

When Amazon.com asks visitors to its Internet site to create wish lists and then invites them to send the lists to people who may be planning on buying them a present soon,it is relying on Web-based interactions to help it learn about its customers.

Question 14

Web-based interactions are an increasingly popular touch point for customers to communicate with companies on their own terms.

Question 15

Consumers are reluctant to enter information through point-of-sale interactions because of privacy violation fears.

Question 16

Database elaboration is the addition of information to customer or prospect records for the purpose of better describing or better determining the responsiveness of those customers or prospects.

Question 17

To initiate the CRM cycle,a company must first identify customer relationships within the organization.

Question 18

Response lists are especially important in database creation because past behavior is a strong predictor of future behavior.

Question 19

The process of centralizing data in a CRM system is sometimes referred to as the interpolation of external and internal touch points.

Question 20

Data mining is used to find hidden patterns and relationships in the customer data stored in the data warehouse.

Question 21

The My Coke Rewards program allows consumers to earn reward products and services by registering points they receive by consuming Coca Cola products.The My Coke Rewards program allows Coca Cola to collect information about consumers that they can use to optimize profitability,revenue,and customer satisfaction.The My Coke Rewards program is an example of a(n)_____ program.

A) organizational optimization
B) consumer relationship marketing (CRM
C) total quality management (TQM)
D) customer relationship management (CRM
E) market aggregation

Question 22

While many catalog retailers send out a standard catalog to all potential customers,Land's End uses information it has gathered about customers in its CRM system to target the catalog to the individual.This approach used by Land's End is an example of the _____ approach.

A) shotgun
B) rifle
C) Square peg,square
D) Fishing pole
E) All of these statements can be used to describe the approach used by Land's End.

Question 23

Which of the following statements about the CRM cycle is true?

A) The letters CRM are an acronym for consumer relationship marketing.
B) The CRM cycle does not affect employees outside the marketing and management functional areas.
C) The CRM cycle is continuous and circular with no predefined start or end point.
D) The CRM cycle takes a simplistic perspective on customers.
E) All of these statements about the CRM cycle are true.

Question 24

A common CRM application is cross-selling other products or services to customers.

Question 25

Best Buy instituted a system in all of its stores that customizes their product offerings for the five key customer segments it has identified: affluent professional males,young entertainment enthusiasts,upscale suburban moms,families who are practical technology adopters,and small businesses with less than 20 employees.This focus implies that Best Buy is:

A) ethnocentric
B) demand-based
C) sales-centric
D) supply-based
E) customer-centric

Question 26

Through customer segmentation,marketers use some past set of occurrences in order to determine what the odds are that certain other occurrences-such as a response or purchase-will take place in the future.

Question 27

_____ is a company-wide business strategy designed to optimize profitability,revenue,and customer satisfaction by focusing on highly defined and precise customer segments.

A) Organizational optimization
B) Consumer relationship marketing (CRM)
C) Total quality management (TQM)
D) Customer relationship management (CRM)
E) Market aggregation

Question 28

Customer relationship management is accomplished by all of the following EXCEPT:

A) offering the lowest prices of all major competitors
B) organizing the company around customer segments
C) establishing and tracking customer interactions with the company
D) fostering customer-satisfying behaviors
E) linking all processes of the company from its customers through its suppliers

Question 29

A company that has a(n)_____ customizes its product offerings based on data generated through interaction between the customer and the company.

A) ethnocentric perspective
B) supply-based focus
C) sales orientation
D) supply-based focus
E) customer-centric focus

Question 30

Updating customers periodically about the status of their orders reinforces purchase decisions.

Question 31

Once customer data are analyzed and transformed into usable information,the information must be:

A) implemented
B) evaluated
C) leveraged
D) stored
E) mined

Question 32

Through campaign management,all areas of the company participate in the development of programs targeted to customers.

Question 33

As the second step in the CRM cycle a company must:

A) establish marketing objectives
B) captures relevant customer data on interactions
C) identify customer relationships with the organization
D) understand the interactions the company has with current customers
E) decide on a segmentation strategy

Question 34

To initiate the CRM cycle,a company must first:

A) establish marketing objectives
B) capture relevant customer data on interactions
C) identify customer relationships with the organization
D) understand the interactions the company has with current customers
E) decide on a segmentation strategy

Question 35

Customer lifetime value analysis shows marketers how much they can spend to acquire new customers.

Question 36

The United States has the most restrictive privacy laws in the world.

Question 37

Which of the following statements about a CRM system is true?

A) A critical component of a CRM system is the use of the appropriate technology to store and integrate customer data.
B) A CRM system operates on the theory that all customers are equally important.
C) Due to privacy laws,a CRM system only disseminates customer information to those who are actually in day-to-day contact with customers.
D) A company using a CRM system must view its customers as bits of data.
E) All of these statements about a CRM system are true.

Question 38

Using technology provided by Smart Button software,the WNBA's Los Angeles Sparks have implemented a new system that gathers information about its best customers,season ticket holders,and rewards those customers in many ways including free tickets to Sparks home games and cash prizes.This is an example of a(n)_____ system.

A) organizational optimization
B) corporate relationship marketing (CRM)
C) total quality management (TQM)
D) customer relationship management (CRM)
E) call response marketing (CRM)

Question 39

When Burpee Gardening company collects relevant information from customers,such as date of last communication with the customer,and how often the customer contacts the company,this is an example of:

A) establishing marketing objectives
B) capturing relevant customer data on interactions
C) identifying customer relationships with the organization
D) understanding the interactions the company has with current customers
E) deciding on a segmentation strategy

Question 40

At its most fundamental level,a CRM approach is no more than:

A) the relationship cultivated by a salesperson with a customer
B) a mass marketing approach
C) a transactional selling approach
D) a customer satisfaction program
E) a differentiation strategy

Question 41

Customer-centric is an internal management philosophy similar to:

A) utilitarianism
B) Herzberg's theory of motivation
C) the equity theory
D) the marketing concept
E) consumerism

Question 42

The Detroit Tigers,a Major League Baseball team,used customer satisfaction surveys of season ticket holders to determine why the number of season ticket holders was declining.This survey was an example of a(n):

A) touch point
B) focus area
C) data search
D) information recognizance
E) observational point

Question 43

Best Buy's Performance Service Plan (PSP)guarantees products against damage and malfunctioning.All initial purchase contact information is kept in the customer database,along with copies of the PSP.If a customer calls Best Buy with a problem,the representative will have access to all this information and can either help the customer or refer him or her to another representative.The availability of this customer information tends to:

A) reduce customer calls
B) empower employees
C) encourage referrals to other employees
D) hurt employee morale
E) increase the need for management supervision

Question 44

The traditional approach for acquiring data from customers is through:

A) encoding devices
B) media
C) feedback mechanisms
D) channel interactions
E) public relations

Question 45

_____ interactions occur when customers buy products in a store.

A) Point-of-sale
B) Relationship-based
C) Cost-based
D) Retail-centric
E) Distribution-focused

Question 46

_____ refers to the latitude organizations bestow on their representatives to negotiate mutually satisfying commitments with customers.

A) Consumer learning
B) Customerization
C) Empowerment
D) Autonomy
E) Interaction

Question 47

Sony wants to build long-lasting relationships by focusingon what satisfies and retains their customers.For example,Sony's Playstation Web site is designed to create a community of users who can join PlayStation Underground where they will "feel like they belong to a subculture of intense gamers." Sony evidently:

A) is sales oriented
B) has a standardization focus
C) is ethnocentric
D) has a customer-centric focus
E) is product oriented

Question 48

Which of the following would be an example of "social" CRM?

A) Placing a phone call to a local department store
B) Leaving a comment on a company's blog
C) Mailing a survey card back to an organization
D) Telling a friend about your experience with an online retailer
E) All of the above are examples of "social" CRM

Question 49

Apple,Inc.has stores,a Web site,and a toll-free phone number where consumers can provide valuable information to the company in developing a CRM system.All these possible areas of the company where consumers can communicate with the business are called:

A) touch points
B) focus areas
C) data mining
D) information search periods
E) experimental points

Question 50

_____ is the process by which learned information from customers is centralized and shared in order to enhance the relationship between customers and the organization.

A) Knowledge management
B) Learning
C) Database marketing
D) Interactive marketing
E) Information marketing

Question 51

Les Ailes de la Mode,a Quebec retail store that promotes the highest quality customer service,has not only established itself as a top retailer in the province,but also as a credit card and point program company,a cataloger and Internet seller,and even a publisher.Through gathering customer information for its credit cards and point program,through catalog and Internet orders,and through subscriptions to its publications,Les Ailes de la Mode has created several different:

A) focus areas
B) touch points
C) interrelationship promotions
D) distribution channels
E) sources of distribution information

Question 52

Zappos is an online shoe and apparel retailer that promotes the highest quality customer service by maintaining the importance of each _____,the point at which customer and store personnel exchange information and develop learning relationships.

A) moment of truth
B) intervention
C) data capture
D) response situation
E) interaction

Question 53

In a CRM system,_____ are all areas of the business where customers have contact with the company and data may be gathered and used to guide and direct the decision making within that business unit.

A) touch points
B) focus areas
C) data mining
D) information search periods
E) observational points

Question 54

Following the customer-centric approach,an interaction can occur through:

A) a salesperson
B) a tweet or Facebook posting
C) a phone call
D) a survey response
E) all of the above

Question 55

Hudson's Bay Company in Canada operates The Bay,Zellers,Home Outfitters,and hbc.com.At each of its stores and its Web site,it gives HBC Rewards that enable members to earn points,which can be redeemed in the HBC Rewards catalog for various items,including travel,leisure and entertainment items,Air Miles reward miles,or Bay and Zellers gift certificates.To use the system,customers have to provide their HBC card number.This reward program enables Hudson's Bay to engage in _____ interactions with its customers.

A) point-of sale and Web-based
B) customer-centric and technology-centric
C) retail-centric and Web-based
D) transaction-based and retail-centric
E) point-of-sale and retail-centric

Question 56

Communications between customers and organizations that occur in stores or at information kiosks are called:

A) live interactions
B) point-of-sale interactions
C) empowerment points
D) survey interactions
E) product interactions

Question 57

Which of the following is an example of a channel through which customer data are traditionally gathered?

A) Store visits
B) Conversations with salespeople
C) Interactions via the Web
D) Phone conversations
E) All of these

Question 58

In a CRM environment,_____ is defined as the informal process of collecting customer information through customer contacts and feedback on product and service performance.

A) leveraging
B) knowledge management
C) interaction
D) data mining
E) learning

Question 59

When Sony Playstation users want to access amenities on the Sony web site,they are required to log in and supply information such as their name,e-mail address,and birth date.They are also given the opportunity to complete a survey that captures much more information about the person and their gaming habits.Sony gathers this information and makes it available internally to better serve the customer.This is an example of a company using:

A) learned research
B) stimulus/response marketing
C) knowledge management
D) sales-oriented marketing
E) motivational research

Question 60

A(n)_____ is the point at which a customer and a company representative exchange information and develop learning relationships.

A) social contact
B) interaction
C) empowering moment
D) equilibrium point
E) transactional dyad

Question 61

A(n)_____ is a collection of data,especially one that can be accessed and manipulated by computer software.

A) database
B) data profile
C) algorithm
D) byte
E) interaction profile

Question 62

Jan Riddle has limited money to invest in a mailing to people who might be interested in subscribing to a new magazine about raising children on the autism spectrum.She wants to mail to those prospects with the highest probability of becoming subscribers.Riddle should use a:

A) compiled list
B) data mine
C) response list
D) management database
E) data warehouse activation

Question 63

The core of the data warehouse is:

A) empowered employees
B) transaction channels of communication
C) point-of-sale interactions
D) the database
E) a compiled list

Question 64

_____ is the process of finding hidden patterns and relationships in the customer data stored in the data warehouse.

A) Data profiling
B) Cluster analysis
C) Regression analysis
D) Customer profiling
E) Data mining

Question 65

In a speech,David Poirier,chief information officer of Hudson's Bay Company,a Canadian retailer,said,"We [Hudson's Bay Company] had all kinds of data in different places.We didn't have a single view of the customer until we focused on finding one method to manage relationships with our customers." Hudson's Bay would use a _____ to profile customer segments for better CRM marketing efforts.

A) data mart
B) customer information system
C) data warehouse
D) decision support system
E) data cluster

Question 66

Outdoor gear retailer Recreational Equipment,Inc.(REI)in Washington collects a vast amount of data through its Web site,direct mailings,and retail stores.When REI considers new store locations,it examines order data to find places with high concentrations of customers buying online and through the company's catalogs.REI would be using _____ to identify potential store locations.

A) information formatting
B) database enhancement
C) data mining
D) data shading
E) customer prediction

Question 67

The Old Westbury College Foundation raised $80,000 at its "A Taste of Long Island," a gala dinner where all proceeds went to support scholarship funds and educational programs at SUNY College at Old Westbury.Attendees were people who had contributed to the scholarship program previously and were reached through a:

A) compiled list
B) data mine
C) response list
D) management database
E) data warehouse activation

Question 68

A _____ is a central repository for data from various functional areas of the organization that are stored and inventoried on a centralized computer system so that information can be shared across all functional departments of the business.

A) data mart
B) customer information system
C) data warehouse
D) decision support system
E) data cluster

Question 69

Which of the following would allow an online retailer like Frontgate to learn that customers who purchase electronic products also purchase home office furniture?

A) Knowledge interpretation
B) Systems management
C) Data mining
D) Information extraction
E) Information search

Question 70

Leah wants to develop a mailing list of people who have participated in bicycle rides for charities.She has offered to purchase a list of last year's Alabama-based Ride for Life,which was held to raise funds for cancer research.Leah is building a(n)_____ list.

A) actionable
B) e-mail
C) response
D) compiled
E) predictive

Question 71

"Lots of organizations have customer data,but not in a way that's useful," said a speaker at a recent retail marketing conference."Retailers have all kinds of data in different places--they don't have a single view of the customer." The speaker is saying that retailers do NOT use:

A) information distribution centers
B) data warehouses
C) information extraction mines
D) data intermediaries
E) marketing information systems

Question 72

Toys "R" Us collects a vast amount of data through its Web site,direct mailings,and retail stores.To be useful,all of these data would be centralized in a(n):

A) data mart
B) decision matrix
C) data warehouse
D) decision support system
E) data cluster

Question 73

All of the following are obstacles faced by multinational companies building worldwide databases EXCEPT:

A) differences in computer systems
B) language barriers
C) variations in data-collection methods
D) legal restrictions on U.S.firms engaged in international data mining
E) all of the above

Question 74

Dae-Ho recently purchased a Uniden cordless phone system using a $10 rebate offer.He filled out the rebate certificate and sent it to an address provided by Uniden.The rebate certificate contained Dae-Ho's full name,his phone number,his address,and some purchase information.Dae-Ho has most likely become part of Uniden's _____ list.

A) compiled
B) cookies
C) response
D) spam
E) Internet research

Question 75

_____ is the addition of information to customer or prospect records for the purpose of better describing or better determining the responsiveness of customers or prospects.

A) Information formatting
B) Database enhancement
C) Data mining
D) Data shading
E) Predictive modeling

Question 76

Continental Airlines has a system that captures information on everything from flight schedules,seat inventories,and customer profiles that is accessible by 35 departments and 1,300 employees.Continental's system is an example of a(n):

A) information mine
B) knowledge distribution center
C) information extraction unit
D) information storage unit
E) data warehouse

Question 77

Walmart captures point-of-sale transactions from thousands of stores in several countries and continuously transmits these data to its massive data warehouse.Wal-Mart allows more than 3,500 suppliers to access data on their products and perform data analyses.These suppliers use the data to identify customer buying patterns at the store level.They use this information to manage local store inventory and identify new merchandising opportunities.Both Wal-Mart and its suppliers are engaged in:

A) information formatting
B) database enhancement
C) data mining
D) data shading
E) descriptive modeling

Question 78

Ford Canada has turned to the Internet to help it stand apart from its competitors in the automotive industry.One Internet ad shows a Ford truck driving out of a forest with its engine roaring and mud splattering on the screen.The wipers come on to reveal the Ford "Built Tough" logo,which then recedes to the side of the screen.The ad directs people to a site where they can sign up to receive direct mail from Ford.Ford Canada will combine this database with a database of new F-series truck owners to look for significant patterns and trends.Ford Canada will use:

A) an information search system
B) knowledge trending
C) data interpolation
D) data graphing
E) data mining

Question 79

Which type of list includes names and addresses of individuals who have responded to an offer of some kind?

A) Interactive list
B) Compiled list
C) Recent list
D) Response list
E) A-list

Question 80

A(n)_____ list generally includes names and addresses gleaned from directories or membership rosters.

A) predictive
B) compiled
C) response
D) actionable
E) disintegrated