Retailing Management: Customer Relationship Management
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Questions and Answers

What is one objective of analyzing a customer database?

  • To forecast sales and allocate merchandise (correct)
  • To monitor employee performance
  • To track customer satisfaction
  • To identify customer demographics

    • What is market basket analysis used for?

  • To forecast sales and allocate merchandise
  • To suggest where to place merchandise in a store (correct)
  • To analyze customer demographics
  • To identify customer purchase patterns

    • What is the main purpose of joint promotions?

  • To promote competitor products
  • To track customer behavior
  • To promote multiple products together (correct)
  • To increase sales of a single product

    • What does RFM analysis stand for?

    <p>Recency, Frequency, Monetary</p> Signup and view all the answers

    What is the objective of CRM programs for first-time customers?

    <p>To convert them into early repeat customers</p> Signup and view all the answers

    What type of retailers often use RFM analysis?

    <p>Catalog retailers and direct marketers</p> Signup and view all the answers

    What is the primary goal of Customer Relationship Management (CRM)?

    <p>To develop a base of loyal customers who patronize the retailer frequently</p> Signup and view all the answers

    What is the term used to describe the percentage of a customer's purchases made from a retailer?

    <p>Share of wallet</p> Signup and view all the answers

    What is the primary focus of CRM systems?

    <p>Identifying and building relationships with the most valued customers</p> Signup and view all the answers

    What is the main difference between CRM and traditional customer service approaches?

    <p>CRM focuses on loyal customers, while traditional approaches focus on all customers</p> Signup and view all the answers

    What is the philosophy behind CRM?

    <p>More profitable customers need to be treated differently</p> Signup and view all the answers

    What does customer loyalty entail?

    <p>More than making repeat visits to a retailer and being satisfied with their experiences</p> Signup and view all the answers

    What is one of the four approaches retailers use to retain their best customers?

    <p>Personalization</p> Signup and view all the answers

    What is the primary purpose of frequent shopper programs?

    <p>To build a customer database and encourage repeat purchase behavior</p> Signup and view all the answers

    What is a key consideration in developing effective frequent shopper programs?

    <p>Offering choices in selecting rewards</p> Signup and view all the answers

    What is one way retailers can build and maintain the loyalty of their best customers?

    <p>By providing unusually high quality customer service</p> Signup and view all the answers

    How can the Internet channel help retailers develop a sense of community among customers?

    <p>By allowing customers to exchange information using bulletin boards</p> Signup and view all the answers

    What is the outcome of customers participating in a community developed by retailers?

    <p>They are more reluctant to leave the 'family' of other people patronizing the retailer</p> Signup and view all the answers

    What is a common practice of small, local retailers that can be automated through the Internet channel?

    <p>One-to-one retailing, tailoring retail programs to individual customers</p> Signup and view all the answers

    According to the 80-20 rule, what percentage of sales or profits come from a certain percentage of customers?

    <p>80 percent of sales from 20 percent of customers</p> Signup and view all the answers

    Which customer segment values customer service over merchandise price?

    <p>Platinum Segment</p> Signup and view all the answers

    Which customer segment is considered the least profitable?

    <p>Lead Segment</p> Signup and view all the answers

    What is the primary difference between the Gold and Platinum customer segments?

    <p>Price sensitivity</p> Signup and view all the answers

    What is the purpose of dividing customers into segments?

    <p>To identify the most profitable customers</p> Signup and view all the answers

    What does customer alchemy involve in retailing management?

    <p>Selling more products and services to existing customers</p> Signup and view all the answers

    What is the objective of add-on selling in retailing?

    <p>To sell additional new products or services to existing customers</p> Signup and view all the answers

    What is the characteristic of the bottom tier of customers in retailing?

    <p>They have negative lifetime value</p> Signup and view all the answers

    What is one approach to dealing with unprofitable customers in retailing?

    <p>Offering less costly approaches to satisfy their needs</p> Signup and view all the answers

    What is the challenge in implementing CRM programs in retailing?

    <p>Implementing CRM programs effectively</p> Signup and view all the answers

    What is required for the effective implementation of CRM programs?

    <p>The coordination of activities by different functions in a retailer's organization</p> Signup and view all the answers

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