Deck 9: Customer Relationship Management CRM

Question 1

Which of the following statements best describes CRM?

A)The letters CRM stand for consumer relationship marketing.
B)CRM collects too little data on customers.
C)CRM provides a process to interact with a customer over the long term.
D)CRM takes a simplistic perspective on customers.

Answer 1

C

Question 2

What is the focus of Stage 2 in the CRM cycle?

A)technology to identify customers
B)marketing research tools that are used
C)tools and concepts offering types of solutions
D)data mining

Answer 2

C

Question 3

Which of the following statements best describes a CRM system?

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 disseminates customer information only 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.

Answer 3

A

Question 4

Bridgestone Canada Inc., a tire service company uses a CRM system called ONDemand5. What kind of information is Bridgestone trying to collect?

A)demographic information
B)information on where customers live
C)information on why they shop there
D)information on why they are loyal customers

Question 5

To develop a successful CRM system, which of the following must companies use?

A)technology
B)technology and strategy
C)technology, strategy, and marketing
D)technology and the 4Ps.

Question 6

What is the term for 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
C)total quality management
D)customer relationship management

Question 7

What is the one focused objective of CRM?

A)building customer loyalty and retaining customers
B)understanding customer buying behaviours
C)delivering promises
D)creating lots of data on customers

Question 8

As a strategy to optimize profitability, revenue, and customer satisfaction, what would the Toronto Blue Jays implement to focus on its fan base and provide them with additional benefits?

A)organizational optimization
B)consumer relationship marketing
C)total quality management
D)customer relationship management

Question 9

What is the value of CRM?

A)a focus on customer's needs
B)a focus on sales
C)a supply-based focus
D)developing a customer who will invest in maintaining a mutually beneficial interaction

Question 10

During the first stage of building a CRM system, what must companies create?

A)an offering
B)an objective
C)a strategy
D)a service

Question 11

What is the objective in Stage 1?

A)to satisfy needs of the customer
B)to create an opportunity for marketing research to occur
C)to better understand the external marketplace
D)to sell the CRM process

Question 12

There is an emphasis in customer relationship management on the hardware and software needed to gather customer information. What is the focus of database creation?

A)management
B)marketing
C)selling
D)retention

Question 13

How much information should the companies collect during Stage 1?

A)20%
B)as much information as possible
C)too much data confuses the issue
D)70%

Question 14

What is customer relationship management based on?

A)the customer's needs
B)an overall company strategy
C)technology to track customers on an individual level
D)strategic management

Question 15

What is the purpose of customer relationship management?

A)to help improve relationships, and build loyalty
B)to predict customer purchases
C)to organize a firms marketing department
D)to assist marketers to sell their products

Question 16

To initiate Stage 2 of the CRM cycle, what must a company do first?

A)identify customer relationships with organizations
B)choose the technology needed for the project
C)build the strategies
D)set the goals of the project

Question 17

To meet the needs of a customer, what must a company first do?

A)create marketing objectives
B)learn more about the customer by doing research
C)determine the level of interaction customers have with the organization
D)acquire and capture customer data for product categories

Question 18

Convergys Corporation is a provider of customer care, human resources, and billing services. Its new software allows anyone talking to a customer to view the customer's order and billing information. This new software would be classified as part of which of the following?

A)organizational optimization
B)call response marketing
C)total quality management
D)customer relationship management

Question 19

What is the focus of Stage One in the CRM cycle?

A)technology to identify customers
B)marketing research tools that are used
C)concepts and types of solutions
D)data mining

Question 20

What industry uses CRM the most?

A)retail
B)wholesaling
C)manufacturing
D)supply chain

Question 21

What do we call 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

Question 22

Synavant is a pharmaceutical company in Toronto. Its director of business development told a group of investors, "There is a single database repository in this company from which everybody can access data about a customer or potential customers." What is Synavant most likely using?

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

Question 23

Sally is a guest at a Marriott hotel.She stepped in a puddle on her way into the hotel. Her shoes were wet, and she planned to wear them to an important sales presentation that day. The hotel concierge saw the guest's unhappy face and asked if he could help. After learning of the problem, the concierge called a nearby shoe store and had a new pair sent over. Why was the concierge able to handle the situation in a manner that created customer satisfaction?

A)Marriott has a sales orientation.
B)Marriott uses knowledge management.
C)Marriott limits customer interactions.
D)Marriott empowers its employees.

Question 24

What does the value of customer data depend on?

A)the system that stores the data
B)the high quality of the system
C)the consistency and accuracy of the data captured
D)the information retrieval

Question 25

What is the purpose of data mining?

A)to sell them products and services
B)to make managerial decisions
C)to understand their consumers
D)to build consumer relationships

Question 26

Les Ailes de la Mode is a Quebec retail store that promotes the highest-quality customer service. It does this by maintaining the importance of the point at which customer and store personnel exchange information and develop learning relationships. What is this point called?

A)knowledge analysis
B)equilibrium point
C)empowerment moment
D)interaction

Question 27

According to your textbook, Bridgestone Canada Inc. uses OnDemand5 to analyze their data for what purpose?

A)to sell products and services
B)to determine which customers qualify for the MasterCare Select program
C)to understand their consumers
D)to provide a loyalty card for their best customers

Question 28

What do we call the process of finding hidden patterns and relationships in the customer data stored in the data warehouse?

A)customer information management
B)data feedback
C)information retrieval
D)data mining

Question 29

The way to people's hearts may be through their stomachs, but Kraft Foods has decided not to rely exclusively on that maxim to secure the long-term loyalty of its customers. It is also making new product developments through data generated from interaction between Kraft and its customers. Which of the following best describes Kraft Foods?

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

Question 30

Which of the following 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 mining
D)information marketing

Question 31

What could a catalogue retailer use to determine consumers' buying habits?

A)data mining
B)information search
C)evoked sets
D)an information environment

Question 32

During 2005-2006, Best Buy introduced a new focus in all of its stores, which will now customize their product offerings for the five key customer segments it has identified. Which type of focus is Best Buy using?

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

Question 33

What would an online retailer use to discover that customers who purchase flannel sheets also have a high probability of purchasing all-natural Christmas wreaths, if the opportunity is made available?

A)knowledge interpretation
B)systems management
C)data mining
D)information extraction

Question 34

What does Bridgestone Canada Inc. use the information in its database for?

A)to sell products and services
B)to develop targeted marketing campaigns
C)to understand their consumers
D)to build consumer relationships

Question 35

What is learning in CRM?

A)the informal process of collecting customer information
B)the formal process of collecting customer information
C)the feedback on the process
D)the feedback on the service performance

Question 36

Foremost Manufacturing makes lighting reflectors and other fabricated metal products. Foremost Manufacturing recognizes that being "good enough" just isn't good enough. With this in mind, Foremost has embarked on a program to transform itself into a manufacturing enterprise with an unwavering focus on customer service. What has Foremost adopted?

A)a demand-based focus
B)a sales focus
C)a supply-based focus
D)a customer-centric focus

Question 37

Which of the following refers to the latitude organizations give their representatives to negotiate mutually satisfying commitments with customers?

A)consumer learning
B)customerization
C)empowerment
D)interaction

Question 38

What does a company have if it customizes its product offerings based on data generated through interaction between the customer and the company?

A)a supply-based focus
B)a sales orientation
C)a marketing orientation
D)a customer-centric focus

Question 39

In a CRM environment, which of the following is defined as the informal process of collecting customer information through customer contacts and feedback on product performance?

A)attitude adjustment
B)organizational perception
C)stimulus/response research
D)learning

Question 40

What internal management philosophy is a customer-centric focus similar to?

A)utilitarianism
B)the equity theory
C)the marketing concept
D)consumerism

Question 41

In a restaurant, when a consumer is greeted, shown to their table and served, in CRM terms, which term describes all of these interactions?

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

Question 42

Which type of interactions occur when customers buy products in a store?

A)point of sale
B)relationship based
C)cost based
D)retail-centric

Question 43

How should an organization view every transaction?

A)as simply a financial exchange
B)as harmful to customer relationship management
C)as the opportunity to collect vast amounts of data about the customer
D)as the creation of customer-organization multiplicity

Question 44

Hong Kong's TravelSky Technology Limited, a provider of information technology solutions for China's air travel and tourism industries, wants to capture the huge amounts of new information required to provide the information needed by its users. What can it create to do this?

A)an information mine
B)a knowledge distribution centre
C)an information storage unit
D)a data warehouse

Question 45

"Lots of organizations have customer data, but not in a way that's useful," said a speaker at the Canadian Marketing Association's national convention. "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 which of the following?

A)information distribution centres
B)data warehouses
C)information extraction mines
D)data intermediaries

Question 46

How does the traditional approach for acquiring data from customers occur?

A)through encoding devices
B)through media
C)through feedback mechanisms
D)through channel interactions

Question 47

Scenario 9-2
Recreational Equipment, Inc. (REI) is a large retailer that specializes in outdoor gear like tents, mountain climbing equipment, mountain bikes and outdoor clothing. They have stores all across North America and are always looking for new locations to open more stores. Recreational Equipment, Inc. (REI) collects a vast amount of data through its website, direct mailings, and retail stores.
Refer to the scenario. 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 catalogues. What is REI using to identify potential store locations?

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

Question 48

David Poirier, CIO of Hudson's Bay Company 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." What would Hudson's Bay use to profile customer segments for better CRM marketing efforts?

A)a data mart
B)a customer information system
C)a data warehouse
D)a data mining system

Question 49

Lesley Owens has limited money to invest in a mailing to people who might be interested in subscribing to a new magazine about making scrapbooks. She wants to send the mailing to those prospects with the highest probability of becoming subscribers. What should she use?

A)a compiled list
B)a data mine
C)a response list
D)a data cluster

Question 50

In Nokia stores, "Experience Areas" feature phones connected to photo printers, speakers, notebook computers, and Bluetooth headsets to demonstrate the interactivity and full range of features available on the cell phones. These "Experience Areas" allow customers to interact with the technology and provide information to Nokia. What are the "Experience Areas" examples of?

A)touch points
B)focus areas
C)information search areas
D)experimental points

Question 51

A large volume of data resulting from a CRM initiative can be managed effectively only through which of the following?

A)technology
B)past purchase history
C)information about the customer's relationship with the organization
D)average amount spent on purchases

Question 52

Scenario 9-1
Hudson's Bay Company in Canada operates The Bay, Home Outfitters, and hbc.com. At each of its stores and its website, it gives HBC Rewards that enable members to earn points, which can be redeemed in the HBC Rewards catalogue for various items, including travel, leisure and entertainment items, Air Miles reward miles, or Bay gift certificates. To use the system, customers have to provide their HBC card number.
Refer to the scenario. Which of the following provides the most likely reason that Hudson's Bay Company implemented this reward program?

A)to acquire more information about its customers
B)to make sure the 80/20 principle is not influencing its activities
C)to retain loyal customers
D)to increase the importance of customer service

Question 53

What is essentially a very large, corporate-wide database, culled from a number of separate systems, such as billing, accounting, order fulfillment, distribution, customer service, and marketing and sales, already in place within an organization?

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

Question 54

The Toronto Blue Jays, a Major League Baseball team, used customer satisfaction surveys of season ticket holders to determine why the number of season ticket holders was declining. What was this survey an example of?

A)a touch point
B)a focus area
C)a data search
D)an interaction

Question 55

The executive vice president of Hudson's Bay Company in Canada (a major retail chain) said in an interview, "We have to be able to offer customers what they want when they want it. We need better insight into their spending-we have gaps in knowledge of how customers spend." Which type of interactions would provide the retail chain the best opportunity for learning about its customers?

A)point of sale
B)relationship based
C)retail-centric
D)sales oriented

Question 56

What is the core of the data warehouse?

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

Question 57

What is the term for a central repository for data from various functional areas of the organization that can be shared by all of the organization's departments?

A)an information mine
B)a knowledge distribution centre
C)an information intermediary
D)a data warehouse

Question 58

Scenario 9-1
Hudson's Bay Company in Canada operates The Bay, Home Outfitters, and hbc.com. At each of its stores and its website, it gives HBC Rewards that enable members to earn points, which can be redeemed in the HBC Rewards catalogue for various items, including travel, leisure and entertainment items, Air Miles reward miles, or Bay gift certificates. To use the system, customers have to provide their HBC card number.
Refer to the scenario. This reward program enables Hudson's Bay to engage in which type of interactions with its customers?

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

Question 59

In Canada what legislation protects customers' privacy?

A)PIPEDA
B)Green Peace
C)CRM
D)OCP

Question 60

Scenario 9-2
Recreational Equipment, Inc. (REI) is a large retailer that specializes in outdoor gear like tents, mountain climbing equipment, mountain bikes and outdoor clothing. They have stores all across North America and are always looking for new locations to open more stores. Recreational Equipment, Inc. (REI) collects a vast amount of data through its website, direct mailings, and retail stores.
Refer to the scenario. To be useful, where could all of these data be centralized?

A)in a data mart
B)in a decision matrix
C)in a data warehouse
D)in a data cluster

Question 61

Which of the following uses a past set of occurrences to forecast the likelihood that some other occurrence, such as a response or purchase, will take place in the future?

A)customer manipulation
B)predictive modelling
C)data mining
D)lifetime value analysis

Question 62

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 Ride for Life, which was held to raise funds for cancer research. Which type of list is Leah building?

A)actionable list
B)response list
C)compiled list
D)predictive list

Question 63

Scenario 9-3
To target outdoor enthusiasts, Subaru added an outdoor life section to its website that is organized by area of interest. The site will serve as a platform for co-marketing and promotional programs.
Refer to the scenario. Which of the following provides the most likely reason that Subaru has added this section to its site?

A)to design a more effective customer outreach program
B)to increase the effectiveness of its channels of distribution
C)to increase the importance of customer service
D)to design more targeted marketing communications

Question 64

L.L. Bean Inc. has been reducing the number of catalogues it sends out while increasing its sales and profits. L.L. Bean now identifies customers who have purchased recently and often and have spent considerable money. Such customers are most likely to purchase again. What is L.L. Bean using to identify these customers?

A)predictive data
B)trend data
C)correlation analysis
D)recency-frequency-monetary analysis

Question 65

BMW automobiles has launched an online effort to market its new styles. It hopes to use its database capabilities to capture valuable data on car buyers.BMW plans on cross-referencing new owners with the database generated from this online campaign to see how many names are duplicated. BMW will use these data to forecast which campaigns have the greatest probability of success. Which of the following methods will BMW most likely use to analyze these data?

A)lifetime value analysis
B)future value assessment modelling
C)recency-frequency-monetary analysis
D)predictive modelling

Question 66

Which of the following involves developing product offerings customized for the appropriate customer segment and then pricing and communicating these offerings for the purpose of enhancing customer relationships?

A)predictive modelling
B)campaign management
C)data mining
D)consumerism

Question 67

What is the technique used to suggest that a customer who wanted to buy a $28 shirt would also be a likely prospect for a cigar humidor?

A)predictive modelling
B)customer segmentation
C)market aggregation
D)data interpolation

Question 68

The Marriot-Hilton hotel chains award points for every dollar spent in one of their hotels. Customers who earn a high number of points are given special privileges that may include upgraded hotel rooms or several free nights. What is the purpose of leveraging this customer information?

A)to retain loyal customers
B)to reinforce competitive promotional decisions
C)to cross-sell other products and services
D)to induce product trial by new customers

Question 69

Which of the following techniques used to analyze marketing databases considers whether a customer has made a purchase recently as well as how often that customer makes a purchase?

A)recency-frequency-monetary analysis
B)predictive modelling
C)data mining
D)lifetime value analysis

Question 70

The cable industry needs to identify current and future traffic patterns so it can manage the growth of cable systems. Because of high costs, it is undesirable to buy bandwidth before it is needed. It is also time consuming to upgrade a cable system. Furthermore, consumers hate to wait for capacity increases. Therefore, what does the industry use to determine when and where new systems should be implemented?

A)lifetime analysis
B)cross-selling
C)speed of data communications
D)predictive modelling

Question 71

The Old Ridley College Foundation raised $80,000 at its "A Taste of Pelee Island," a gala dinner where all proceeds went to support scholarship funds and educational programs at SUNY College at Old Ridley. Attendees were people who had contributed to the scholarship program previously. How would they have been reached?

A)through a compiled list
B)through a response list
C)through a management database
D)through a data warehouse database

Question 72

The Blue Jays gave 5,000 Blue Jay season ticket holders a customized digital gift card. Fans will access the card's offerings by using a provided password that takes them to the Jays' website where they can apply for a 10 percent discount for purchases made on the site. The card also features a brief collection of video highlights as well as links to different areas of the Jay' website. What is the team's goal?

A)to cross-sell
B)to reinforce purchase decisions
C)to retain loyal customers
D)to create team awareness

Question 73

Marketing to repeat customers is more profitable than marketing to first-time buyers is a basic assumption of which of the following?

A)customer segmentation
B)predictive modelling
C)data manipulation
D)lifetime value analysis

Question 74

Which type of list generally includes names and addresses gleaned from directories or membership rosters?

A)predictive list
B)compiled list
C)response list
D)actionable list

Question 75

Best Buy uses CRM to track visitors to its website. This tracking allows the retailer to confidently project the value of its repeat customers through its application of which of the following?

A)customer segmentation
B)customer valuation
C)data manipulation
D)lifetime value analysis

Question 76

Tom recently purchased a GE microwave oven using a $50 rebate offer. He filled out the rebate certificate and sent it to an address provided by GE. The rebate certificate contained Tom's full name, his phone number, his address, and some purchase information. Tom has most likely become part of which of GE's lists?

A)compiled lists
B)response lists
C)electronic cash lists
D)Internet research lists

Question 77

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 website 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. Which of the following best describes what Ford Canada will be using?

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

Question 78

Looking to build up its postpurchase relationships, General Motors recently launched a service whereby GM vehicle owners can sign up to get email service reminders, access information about GM vehicles, and receive special promotions. What is General Motors using to enhance its customer relationships?

A)modelling
B)scoring
C)campaign management
D)data mining

Question 79

Scenario 9-3
To target outdoor enthusiasts, Subaru added an outdoor life section to its website that is organized by area of interest. The site will serve as a platform for co-marketing and promotional programs.
Refer to the scenario. This offering of customized products to a customer segment for the purpose of enhancing the auto manufacturer's customer relationships is an example of which of the following?

A)campaign management
B)customer aggregation
C)transaction segmentation
D)data mining

Question 80

To be successful, what must companies do?

A)information formatting
B)identify their best customers
C)data mining
D)predictive modelling