AS Level: 17 - The nature of marketing

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

• Attract new customers
• Reduce production costs
• Develop customer loyalty
• Launch new products

Answer explanation

CRM focuses on building long-term relationships to retain existing customers.

Which of the following is an example of niche marketing?

• Selling soft drinks to a global audience
• Selling luxury watches to high-income buyers
• Selling basic groceries to all demographics
• Offering discounted items

Answer explanation

Niche marketing targets a specific, often smaller, segment with unique needs.

What is meant by "mass marketing"?

• Marketing to a small segment of the market
• Targeting a broad audience with one product
• Customizing products for each individual
• Focusing on high-income customers

Answer explanation

Mass marketing aims to reach a large audience with a standardized product.

Which of the following is NOT a method of market segmentation?

• Geographic
• Economic
• Demographic
• Psychographic

Answer explanation

Economic segmentation is not typically used; geographic, demographic, and psychographic are standard methods.

In geographic segmentation, a business would adapt its strategy based on:

• Customer location
• Customer age
• Customer interests
• Customer income

Answer explanation

Geographic segmentation tailors marketing to specific locations, e.g., countries or regions.

In which situation is mass marketing most effective?

• When targeting niche markets
• When aiming for a broad, general audience
• When targeting very specific demographics
• When focusing on personalized services

Answer explanation

Mass marketing is suited for products that appeal to a wide audience.

Which of the following statements about Customer Relationship Marketing is correct?

• CRM focuses solely on price reduction
• CRM aims to build long-term customer loyalty
• CRM is about rapid customer acquisition
• CRM only applies to large businesses

Answer explanation

CRM’s main goal is to retain customers by fostering loyalty.

Which market segmentation method considers factors like age and income?

• Geographic
• Demographic
• Psychographic
• Behavioral

Answer explanation

Demographic segmentation uses age, income, and other population characteristics.

A heating company using geographic segmentation would most likely:

• Target customers based on lifestyle
• Focus on customers in colder regions
• Target customers based on age
• Focus on urban customers only

Answer explanation

Geographic segmentation adapts marketing based on location, like colder climates for heating products.

Which of the following is an example of psychographic segmentation?

• Segmenting by income level
• Segmenting by lifestyle and values
• Segmenting by age
• Segmenting by location

Answer explanation

Psychographic segmentation divides the market based on lifestyle, values, and attitudes.