SM Chapters 12-14

The wheel of loyalty is composed of which of the following three main components?

• Create loyalty bonds; deliver quality service; segment the market

• Create loyalty bonds; build higher level bonds; deliver quality service

•   Build a foundation for loyalty; create bundling; build higher level bonds

• Build a foundation for loyalty; create loyalty bonds; reduce churn drivers

The segment that sees high value in firm’s offer, spends more over time while costing less to maintain, and spreads positive WOM is called ___________.

• Gold

• Platinum

• Iron

• Lead

Marketing activity designed to create extended relationships with customers is called _____________.

• relationship marketing

• loyalty programs

• transactional marketing

• customer service marketing

Loyalty management begins with segmenting the market to match customer needs and firm profitability.

(False; Easy)

• False

• True

Zero defection refers to when a company can retain all customers it can serve, profitably or not profitably.

• False

• True

Which of the following is NOT one of the options customers take when they are dissatisfied with a service encounter?

• Take legal action

• Vent their anger on the service equipment.

• Do nothing.

• Complain to the service firm.

All EXCEPT which of the following are reasons that service guarantees are powerful tools for both promoting and achieving service quality?

• Guarantees reduce consumer complaining, increasing customer satisfaction and information from customers.

• Guarantees force firms to focus on what their customers want and expect in each element of the service.

• Guarantees set clear standards, telling customers and employees alike what the company stands for.

• Guarantees building “market muscle” by reducing the risk of the purchase decision and developing long-term loyalty.

Which of the following is NOT one of the reasons why customers complain that is listed in the book?

• Better understand the failure

• Vent their anger

• Help improve the service

• Obtain restitution or compensation

Service recovery is an umbrella term for systematic efforts by a firm to correct a problem following a service failure and retain a customer’s goodwill.

• True

• False

A jaycustomer is defined in the book as one who acts in a thoughtless or abusive way, causing problems for the firm, its employees, and other customers.

• True

• False