Ch. 4

Question 1

The Four I’s of Internet marketing include:

a. information-driven, intuitive.
b. integrated, immediate.
c. involving, interactive.

Answer 1

c. involving, interactive.

82

Question 2

The basic direct-response strategies are:

a. attraction, commitment, and loyalty.
b. acquisition, conversion, and retention.
c. attraction, conversion, and retention.

Answer 2

b. acquisition, conversion, and retention.

85

Question 3

Important characteristics of a direct-response offer include:

a. incentive to encourage action.
b. a call to action.
c. both of the above.

Answer 3

c. both of the above.

86

Question 4

Objectives of a direct-response marketing program can include:

a. generating sales leads.
b. creating awareness of a product or service.
c. developing brand image.

Answer 4

a. generating sales leads.

86-87

Question 5

Which of the following is a true statement about the front end of marketing?

a. It includes the activities that are most likely to produce satisfied customers.
b. It describes marketing activities that take place prior to the product being introduced to the market.
c. Front-end activities are the most visible aspects of marketing.

Answer 5

c. Front-end activities are the most visible aspects of marketing.

88

Question 6

Among the uses of CLV data to Harrah’s is:

a. to drive programs that increase customer value.
b. to provide a powerful way to segment markets.
c. both the above.

Answer 6

c. both the above.

106

Question 7

True statements about testing in the Internet environment are:

a. testing requires a substantial amount of marketing research.
b. testing provides information that is not ordinarily available to marketers in the mass media environment.
c. both of the above.

Answer 7

b. testing provides information that is not ordinarily available to marketers in the mass media environment.

96

Question 8

________ is a simple type of test frequently used in various marketing media.

a. Control group
b. Factorial design
c. A/B split

Answer 8

c. A/B split

96

Question 9

Which of the following is a true statement about data mining?

a. Data mining can uncover previously unsuspected patterns in the data.
b. Marketers require the assistance of statisticians to get information from data mining routines.
c. Data mining routines were developed specifically to deal with the massive amounts of data available from the Internet.

Answer 9

a. Data mining can uncover previously unsuspected patterns in the data.

106

Question 10

Among the interactive strategies marketers can pursue are:

a. information, transaction, and personalization.
b. transaction, personalization, and collaboration.
c. interaction, profiling, and customization.

Answer 10

a. information, transaction, and personalization.

109

Question 11

Important characteristics of a direct-response offer include:

a. always having a purchase as the objective.
b. deferred action on the part of the prospective customer.
c. a clear call to action.

Answer 11

c. a clear call to action.

86

Question 12

________ is the term used to describe the marketing activities that involve fulfillment and customer service:

a. Back end
b. Inventory management
c. Front end

Answer 12

a. Back end

88

Question 13

Which of the following is a true statement about the front end of marketing?

a. It describes marketing activities that take place prior to the product being introduced to the market.
b. It includes all the activities most likely to produce satisfied customers.
c. The front end involves customer acquisition activities.

Answer 13

c. The front end involves customer acquisition activities.

88

Question 14

________ is the concept that helps the marketer understand how much it costs to acquire, maintain, and service a customer.

a. Market segmentation
b. Customer lifetime value
c. Lead generation

Answer 14

b. Customer lifetime value

90

Question 15

An important use of customer lifetime value data is:

a. as a replacement for market segmentation.
b. to determine the allocation of marketing resources to marketing programs.
c. to decrease the need for targeting specific customer groups.

Answer 15

b. to determine the allocation of marketing resources to marketing programs.

94

Question 16

Which of the following is not a true statement about CLV?

a. It is the net present value of the net margin minus the cost of serving a specific customer.
b. It can be used only by traditional direct marketers.
c. It requires an extensive customer database.

Answer 16

b. It can be used only by traditional direct marketers.

92

Question 17

The “best customer model: called RFM:

a. helps marketers determine what kinds of new customers to acquire.
b. is a multiplicative model composed of recency, frequency and monetary value.
c. both of the above.

Answer 17

c. both of the above.

94

Question 18

Benefits of having and utilizing a marketing database include:

a. not having to perform statistical analysis on the data.
b. being able to construct customer profiles.
c. having a single customer database that includes information from other functional areas of the business.

Answer 18

b. being able to construct customer profiles.

105

Question 19

The set of tools used to extract useful marketing information quickly from their database is called:

a. statistical program analysis.
b. automated profiling.
c. data mining.

Answer 19

c. data mining.

106

Question 20

Developing and using a customer database allowed Harrah’s to:

a. locate the data they needed to execute pre-existing strategies.
b. find good locations for new casinos.
c. develop a model of how much a customer might be expected to spend.

Answer 20

c. develop a model of how much a customer might be expected to spend.

106,107

Question 21

A hierarchy of interactive activities suggests that ________ is a customer-focused activity that can be pursued after a foundation of less information-intensive activities is built.

a. personalization
b. market segmentation
c. building a customer database

Answer 21

a. personalization

109

Question 22

NIKEiD is an example of:

a. an interactive website.
b. use of a customer database.
c. product customization.

Answer 22

c. product customization.

110

Question 23

23. The type of firm that typically has established capabilities in fulfillment and customer service:

a. manufacturers.
b. direct marketers.
c. internet marketers.

Answer 23

b. direct marketers.

88

Question 24

The interactivity of the Internet is important to its usefulness as a direct-response medium.

Answer 24

True

82

Question 25

It is not important whether the Internet is recognized as a direct-response medium or not.

Answer 25

False

82

Question 26

The immediacy of the Internet can be employed to satisfy the consumer’s desire for instant gratification.

Answer 26

True

82

Question 27

A direct-response offer must include a call to action.

Answer 27

True

86

Question 28

It is impossible to calculate the value of a fan on social media.

Answer 28

False

95

Question 29

A “sticky” website is one that can last for a considerable period of time without major changes and updates

Answer 29

False

86

Question 30

The “back end” refers to business functions like warehousing and distribution that are not a concern of the marketer.

Answer 30

False

85

Question 31

CLV is essentially the NPV of all sales to a given customer.

Answer 31

False

92

Question 32

In CLV calculations the discount rate is based solely on the current interest rate.

Answer 32

False

92

Question 33

Marketers should be attempting to acquire more new customers like their best current customers.

Answer 33

True

94

Question 34

Response modeling is a form of predictive modeling.

Answer 34

True

105

Question 35

A data warehouse is a repository where data that is no longer current is stored.

Answer 35

False

104

Question 36

Data mining tools are designed to sift through large quantities of data looking for patterns of customer behavior.

Answer 36

True

106

Question 37

Information-driven marketing can be thought of as a process that permits interactions, transactions, personalization and customization.

Answer 37

True

110

Question 38

All offers are a form of sales promotion.

Answer 38

True

85