Ch12 (Extension) Database Marketing

Ch12 (Extension) Database Marketing

1) Which of the following marketing techniques refers to the application of business intelligence systems to the planning and execution of marketing programs?

A) ambush marketing
B) viral marketing
C) database marketing
D) guerrilla marketing

C) database marketing
2) Databases are not a key component of database marketing. TRUE or FALSE
False
3) Data mining techniques are essential for database marketing. TRUE or FALSE
True
5) ________ is a way of analyzing and ranking customers according to their purchasing patterns.

A) Composite forecast
B) RFM analysis
C) Regression analysis
D) Delphi technique

B) RFM analysis
6) Which of the following is the first step in the process of producing an RFM score?

A) dividing the customers according to the amount spent on purchases
B) sorting customer purchase records based on the purchase frequency
C) sorting customer purchase records by the date of most recent purchase
D) dividing customers into two groups based on the gender and giving each group a score

C) sorting customer purchase records by the date of most recent purchase
7) In RFM analysis, an R score of 5 shows that ________.

A) a customer has not made any recent purchases
B) a customer has bought the most expensive items
C) a customer has frequently ordered expensive items
D) a customer has purchased the least expensive items

A) a customer has not made any recent purchases
8) In RFM analysis, an F score of 1 shows that ________.

A) a customer has bought the least expensive items
B) a customer has frequently placed orders
C) a customer has always bought the most expensive items
D) a customer has rarely made a purchase

B) a customer has frequently placed orders
9) In RFM analysis, customers who have bought the least expensive items are indicated by an M score of ________.

A) 2
B) 5
C) 1
D) 4

B) 5
10) Cheryl Inc., a leading cosmetics manufacturer, wants to identify its most valued customers. Each customer is assigned an RFM score based on their purchasing patterns. One of their valued customers has an RFM score of 545. In this case, the ideal action for Cheryl’s sales team is to ________.

A) up-sell more expensive goods to this customer
B) contact this customer immediately
C) not waste any time on this customer
D) set up an automated contact system for this customer

C) not waste any time on this customer
11) Which of the following RFM scores refers to the most valuable customer?

A) 111
B) 555
C) 123
D) 333

A) 111
12) The RFM score is obtained by ranking customers based on the positive feedback for a product after purchasing it. TRUE or FALSE
False
13) RFM analysis is a complex technique that is difficult to implement. TRUE or FALSE
False
14) A high F score denotes that the customer has bought an expensive item recently. TRUE or FALSE
False
15) Customers with an RFM score of 555 are highly valued by organizations. TRUE or FALSE
False
16) The frequency of customer purchases is not a determining factor for RFM scores. TRUE or FALSE
False
17) RFM analysis can be a useful tool to determine the best customers based on the frequency of their purchases. TRUE or FALSE
True
18) RFM scores are basically beneficial to salespeople, as it gives a clear picture of a customer’s buying pattern. TRUE or FALSE
True
19) A reporting system that generates RFM data can be automated. TRUE or FALSE
True
21) Which of the following is a data mining technique for determining sales patterns?

A) RFM analysis
B) market-basket analysis
C) composite analysis
D) regression analysis

B) market-basket analysis
22) In marketing transactions, the fact that customers who buy product X also buy product Y creates a ________ opportunity.

A) relationship selling
B) cross-selling
C) value added selling
D) persuasive selling

B) cross-selling
27) A market-basket analysis shows the products that customers tend to buy together. TRUE or FALSE
True
28) A market-basket analysis is used to explore cross-selling opportunities. TRUE or FALSE
True
29) The more frequently two items occur in the same transaction, the higher the probability of them being purchased together. TRUE or FALSE
True
30) A cross-selling opportunity is created when a consumer purchases only a single product. TRUE or FALSE
False
34) Which of the following techniques uses a hierarchical arrangement of criteria to predict a classification or value?

A) market-basket analysis
B) RFM technique
C) Cooke method
D) decision tree

D) decision tree
35) Which of the following is the basic idea of the decision tree technique?

A) to perform an RMF analysis and rank consumers according to their purchasing patterns
B) to select attributes that are most useful for classifying entities on some criterion
C) to produce computer programs for information systems
D) to use the minimum difference among groups created by the decision tree algorithm

B) to select attributes that are most useful for classifying entities on some criterion
37) Decision tree analysis is a data mining technique that requires a high degree of supervision. TRUE or FALSE
False
38) Groups created by decision tree algorithms are as different from each other as possible. TRUE or FALSE
True
39) A minimum difference among groups is used as the criterion for constructing the decision tree. TRUE or FALSE
False (maximum)

Leave a Reply

Your email address will not be published. Required fields are marked *