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Chapter 1: An introduction to services

The _____________ reflects the view that the intangible aspects of products are becoming the key features that
differentiate the product in the marketplace.

*
*
*
*
*

services marketing
Servuction model
service imperative
benefit concept
industrial management model

Which of the following businesses would be characterized as a pure service*

*
*
*
*
*

insurance
farming
mining
engineering
there is no such thing as a pure service

General Motors, the manufacturing giant's, largest supplier is:

*
*
*
*
*

Blue Cross-Blue Shield Insurance


GMAC Financing
a parts supplier
a legal firm
a trucking company

Which of the following sets of terms best describes a service*

*
*
*
*
*

objects, devices, and performances


effort, objects, and deeds
things, devices, and performances
objects, devices, and things
deeds, effort, and performances

Deeds, efforts and performances define:

*
*
*
*
*

products
ideas
services
goods
places

The continuum that ranges from tangible-dominant to intangible-dominant is referred to as:

*
*
*
*
*

the services triangle


the Servuction model
the scale of market entities
the service-profit chain
the Q continuum

Businesses such as fast food restaurants would fall where along the Scale of Market Entities*

*
*
*
*
*

on the extreme end of the intangible-dominant side


on the extreme end of the intangible-dominant side
in the middle of the continuum
left of the middle towards the tangible-dominant side
right of the middle towards the intangible-dominant side

Which of the following fields would be least likely to be described as intangible-dominant*

*
*
*
*
*

manufacturing
education
insurance
banking
engineering

Which of the following products is an example of intangible dominant*

*
*
*
*
*

Outback steakhouse
car rental agency
a funeral
a magazine subscription
math tutoring

Which of the following statements is not true*

*
*
*
*
*

Service knowledge is obtained differently than goods knowledge.


Firms that define their businesses too narrowly have developed marketing myopia.
Goods are tangible-dominant.
Service knowledge is obtained through the experience of receiving the actual service.
All the above are true.

_______ results in the practice of too narrowly defining ones business:

*
*
*
*
*

Services marketing
Marketing management
Marketing myopia
Scale of market entities
Customer experience

__________ involves a pictorial representation of the relationship between the tangible and intangible elements of
a firms operation.

*
*
*
*
*

Molecular Model
Servuction Model
Benefit concept
Industrial Management Model
Market-focused Model

Which of the following could NOT be included in the airline molecular model*

*
*
*
*
*

long-term parking
financing arrangements
rental car availability
gate attendants
baggage handlers

The encapsulation of the benefits of product in the consumer's mind is called:

*
*
*
*
*

the Servuction Model


the benefit concept
the Service Triangle
the Service-Profit Chain
the Scale of Market Entities

According to the Servuction Model, factors that influence the customer's service experience include all of the
following except:

* price

*
*
*
*

contact personnel/service providers


other customers
servicescape
organization and systems

Which of the following components of the Servuction Model is not visible to consumers*

*
*
*
*
*

servicescape
organization and systems
other customers
contact personnel
service providers

A customer who notices dirty silverware and a dirty floor in his/her favorite restaurant has been influenced by
which of the following components of the Servuction Model*

*
*
*
*
*

servicescape
organization and systems
other customers
contact personnel
service providers

Servicescape consists of which of the following features:

*
*
*
*
*

personal artifacts
inanimate objects
signs
symbols
all of the above

The component of the Servuction Model over which most service firms have the least control is:

*
*
*
*
*

servicescape
organization and systems
other customers
contact personnel
service providers

If an office did not schedule as many people as were needed during a busy period, which of the following
components of the Servuction Model has influenced the customer's experience*

*
*
*
*
*

servicescape
organization and systems
other customers
contact personnel
service providers

A customer attempted to pay his bill with his American Express credit card; however, the service firm did not
accept American Express. Which of the following components of the Servuction Model influenced the customer's
experience*

*
*
*
*
*

servicescape
organization and systems
other customers
contact personnel
service providers

The demand for services marketing knowledge has increased for all of the following reasons except:

* the tremendous growth in service-sector employment

* increasing service-sector contributions to the world economy


* the deregulation of many service industries
* the needed shift from industrial models of management to market-focused management
approaches
* the decline in service sector jobs
Ranking from highest to lowest, the countries with the largest service sector employment are:

*
*
*
*
*

European Community, United States, Japan


United States, Japan, European Community
United States, European Community, Japan
United States, European Community, Japan
Japan, European Community, United States

With regards to service sector employment in the EU, which of the following statements is TRUE*

*
*
*
*
*

Between 2002 and 2012, 10% of all jobs were service jobs.
92% of the labour force is employed in service sector jobs.
In 2007 144m were employed in the service sector.
Employment in the service sector is declining as manufacturing grows.
Europe is second to China in service sector employment.

What percentage of the EUs Gross Domestic Product wass generated by the service sector in 2006*

*
*
*
*
*

88.2%
70.5%
60.1%
50.5%
45.7%

An approach to organizing a firm that focuses on revenues and operating costs and has its roots in manufacturing
is called:

*
*
*
*
*

the operations management approach


the industrial management approach
the manufacturing management approach
the market-focus management approach
the services marketing approach

The industrial management model believes

*
*
*
*
*

employees want to do good work


front-line personnel are more important than upper- and middle-managers
technology should be used to assist employees
labor and operating costs should be kept as low as possible
front-line employees should be empowered to make decisions

According to the industrial management model, which one of the following statements is FALSE*

*
*
*
*
*

Location strategies, sales promotions, and advertising drives sales revenues.


Employees are to be held to low job performance expectations.
Only managers can solve problems.
It is better to rely on machines, than humans.
Technology should be used to assist employees, rather than to monitor or control them.

The management model that focuses on the components of the firm that facilitate the firm's service delivery
system is called:

* the operations management approach

*
*
*
*

the industrial management approach


the manufacturing management approach
the market-focused management approach
the services marketing approach

According to the market-focused management model, which one of the following statements is TRUE*

*
*
*
*
*

Location strategies, sales promotions, and advertising drives sales revenues.


Employees are to be held to low job performance expectations.
Only managers can solve problems.
It is better to rely on machines, than humans.
Technology should be used to assist employees, rather than to monitor or control them.

According to the market-focused management model, which one of the following statements is FALSE*

* Companies should invest in people as much as machines.


* Employee turnover and customer satisfaction are clearly related.
* The higher the proportion of part-time to full-time employees, the more satisfied the
customers.
* New accounting measures are needed that reflect the focus on customer orientation.
* Data collected and controlled by middle managers should be made available to front-line
personnel.
Which linkage within The Service Triangle reflects the ease with which a customer uses a bank's ATM*

*
*
*
*
*

The systems--the customer


The service strategy--the customer
The systems--the people
The customer--the people
The service strategy--the systems

Which linkage within The Service Triangle reflects Pizza Hut's strategy of communicating its commitment to service
excellence to its employees through television commercials*

*
*
*
*
*

The systems--the customer


The service strategy--the customer
The systems--the people
The customer--the people
The service strategy--the people

Which linkage within The Service Triangle represents the interaction that creates "moments of truth" or "critical
incidents"--the driving forces in customer satisfaction evaluations*

*
*
*
*
*

The systems--the customer


The service strategy--the customer
The systems--the people
The customer--the people
The service strategy--the people

The market-focused management model, supported by the service triangle, is based on the belief that:

*
*
*
*
*

front-line personnel tend to be more knowledgeable


employees want to do good work
customer satisfaction is related to employee turnover
a new accounting measures should be used
none of the above

Chapter 2: Fundamental Differences Between Goods and Services

Test Yourself on MIS


Show questions one by one
Services are characterized by all of the following characteristics except for:

*
*
*
*
*

intangibility
homogeneity
perishability
inseparability
heterogeneity

Which of the following statements is false*

* Services cannot be touched or seen in the same manner as goods.


* Consumer judgments about services tend to be more subjective than
objective.
* Services are first produced, then sold, then consumed.
* Services tend to vary from one transaction to the next.
* Services cannot be inventoried.
Of the four unique service characteristics that distinguish goods from services,
the one that is the primary source of the other three characteristics is:

*
*
*
*
*

intangibility
inseparability
homogeneity
perishability
heterogeneity

Which of the following is not a marketing problem caused by intangibility*

*
*
*
*
*

Services lack the ability to be stored


Services lack patent protection
Services are difficult to price
Services are difficult to communicate to consumers
Consumers are involved in the service production process

Which of the following is a marketing problem caused by intangibility*

*
*
*
*
*

Services have no costs of goods sold.


The consumer is involved in the production process.
Other consumers are involved in the production process.
Service standardization and quality control are difficult to achieve.
Centralized mass production of services is difficult.

The primary cost of producing a service is

*
*
*
*
*

rent
overhead
cost of goods sold
labour
promotional expenses

Possible solutions that minimize the problems caused by intangibility include all
of the following except:

* The use of tangible clues.


* The effective management of consumers.
* The creation of a strong organizational image.

* The use of personal sources of information.


* Prudential's "Piece of the Rock" promotional strategy.
The unique service characteristic that reflects the interconnection between the
service firm and its customer is called:

*
*
*
*
*

intangibility
inseparability
homogeneity
perishability
heterogeneity

Marketing problems caused by inseparability include all of the following


except for:

*
*
*
*
*

The service provides physical connection to the service.


The involvement of the customer in the production process.
Service standardization and quality control are difficult to achieve.
The involvement of other customers in the production process.
All of the above are marketing problems caused by inseparability.

The fact that services are sold and then produced and consumed simultaneously is attributed to:

*
*
*
*
*

intangibility
inseparability
homogeneity
perishability
heterogeneity

Which of the following statements pertain to inseparability is false*

*
*
*
*
*

As customer contact increases, the efficiency of the firm decreases.


Customers can affect the type of service desired.
Customers can affect the length of the service transaction.
Customers can affect the cycle of demand.
All the above statements are true.

The centralized mass production of services is difficult due to:

*
*
*
*
*

inseparability
intangibility
homogeneity
perishability
heterogeneity

Possible solutions that firms use to minimize the problems caused by inseparability include all of the following
except:

*
*
*
*
*

The careful selection of service employees.


The management of service consumers.
The use of multisite locations to distribute services.
The training of public contact personnel.
Appealing to market segments with different demand patterns.

The primary solution to overcome the centralized mass production problems attributed to inseparability is:

* The careful selection of service employees.


* The management of service consumers.
* The use of multisite locations to distribute services.

* The training of public contact personnel.


* Appealing to market segments with different demand patterns.
The service characteristic that reflects the variation in consistency from one service transaction to the next is:

*
*
*
*
*

inseparability
intangibility
homogeneity
perishability
heterogeneity

Which of the following statements pertaining to heterogeneity is false*

* It is almost impossible for a service operation to achieve 100 percent


perfect quality on an ongoing basis.
* Standardization and quality control are difficult to achieve.
* Customers always prefer customized services over standardized services.
* Customized services are generally more expensive than standardized
services.
* It is easier to customize services than goods.
Which of the following is not an advantage of standardized services*

*
*
*
*
*

Less expensive
Meets the customer's exact needs
Delivered faster
More consistent
All the above are advantages of standardized services.

Solutions used to minimize the marketing problems attributed to heterogeneity include:

*
*
*
*
*

standardizing or customizing the service


using multisite locations
stressing tangible clues
appealing to different market segments with different demand patterns
using reservation systems

The unique service characteristic that deals specifically with the inability to inventory services is:

*
*
*
*
*

inseparability
intangibility
homogeneity
perishability
heterogeneity

Complications attributed to perishability include all of the following except:

* Services which are not sold when they become available cease to exist.
* The production and consumption of services cannot be separated by
time and space.
* Statistical sampling techniques are of little use in services.
* Due to the lack of inventories, marketing and operations must work much closer together.
* All of the above are complications associated with perishability.
Which of the following scenarios is likely to lead to the highest levels of customer dissatisfaction*

* higher demand than maximum available supply


* higher demand than optimal supply levels
* lower demand than optimal supply levels

* demand and supply at optimal levels


* all of the above scenarios result in customer dissatisfaction
Which of the following strategies increases the supply of service available to consumers*

*
*
*
*
*

the use of creative pricing strategies


the use of reservation systems
capacity sharing
developing complementary services
developing nonpeak demand

Possible strategies for managing demand and minimizing the marketing problems associated with perishability
include which of the following:

*
*
*
*
*

the use of creative pricing strategies


the use of reservation systems
developing complementary services
developing nonpeak demand
all of the above

The demand strategy in which service providers utilize their downtime by marketing to different segments with
different demand patterns is associated with which of the following:

*
*
*
*
*

the use of creative pricing strategies


the use of reservation systems
capacity sharing
developing complementary services
developing nonpeak demand

A perishability-related strategy that increases the supply of service by forming a type of co-op among service
providers that permits co-op members to expand their supply of services as a whole is referred to as:

*
*
*
*
*

co-op formation
capacity sharing
advance preparation for expansion
the utilization of third parties
creative management

Which of the following strategies increases the supply of service available to consumers*

*
*
*
*
*

increasing consumer participation


the use of creative pricing strategies
the use of reservation systems
developing complementary services
developing nonpeak demand

Which one of the following statements is true*

* The use of third parties increases the supply of service.


* Reservation systems can be used to alter the demand for services.
* Customer participation in services may result in some loss of control by the service
establishment.
* The marketing department of service organizations must maintain a much
closer relationship with the rest of the organization than what is typical in
a goods business.
* All the above are true.
The perishability-related strategy that may sometimes be associated with consumer feelings that the service firm
may be attempting to distance itself from consumers is:

*
*
*
*
*

the use of reservation systems


training public contact personnel
the use of third-parties to conduct service transactions
increasing the amount of consumer participation
both a and d

Which one of the following strategies is used to alter consumer demand*

*
*
*
*
*

increasing consumer participation


utilizing third parties
utilizing creative pricing strategies
sharing capacity
preparing in advance for expansion

Which of the following would not be considered a tangible clue*

*
*
*
*
*

the quality of instruction in an educational setting


the appearance of employees
the appearance of the firm's physical facilities
the smile on an employee's face
the quality of paper stock use to produce a firm's brochures

Please match the appropriate unique service feature with the resulting marketing problem the feature causes.
Centralized mass production of services is difficult.

*
*
*
*

intangibility
inseparability
heterogeneity
perishability

Standardization and quality control are difficult.

*
*
*
*

intangibility
inseparability
heterogeneity
perishability

Cannot protect services through patents.

*
*
*
*

intangibility
inseparability
heterogeneity
perishability

Prices are difficult to set.

*
*
*
*

intangibility
inseparability
heterogeneity
perishability

Other customers are involved in the production process.

*
*
*
*

intangibility
inseparability
heterogeneity
perishability

Please match the appropriate service feature with the marketing strategy suggested to compensate for the
marketing difficulties associated with the feature.
Standardize the service.

*
*
*
*

intangibility
inseparability
heterogeneity
perishability

Use tangible clues.

*
*
*
*

intangibility
inseparability
heterogeneity
perishability

Emphasize the selection and training of public contact


personnel.

*
*
*
*

intangibility
inseparability
heterogeneity
perishability

Effectively manage consumers.

*
*
*
*

intangibility
inseparability
heterogeneity
perishability

Make adjustments between supply and demand to


achieve a balance between the two.

*
*
*
*

intangibility
inseparability
heterogeneity
perishability

Chapter 3: An overview Of The Services Sector

Test Yourself on MIS


Show questions one by one
It is generally accepted that the _______ includes the soft parts of the economy consisting of several subsectors.

*
*
*
*
*

service economy
industrial economy
agricultural economy
information economy
goods economy

What is European classification scheme for economic activities and products*

*
*
*
*
*

ISIC
NACE
NICE
NAICS
EU sectors

Financial activities sector consists of all the following except:

*
*
*
*
*

Finance
Insurance
Social welfare
Pensions
Share brokerage

The world's largest industry in the private sector and highest projected generator of jobs is:

*
*
*
*
*

business services
the hospitality industry
health services
professional services
retail

1 in 4 Europeans are currently consuming services from which sector*

*
*
*
*
*

Education
Healthcare
Social assistance
Professional services
The food services

Which sector includes the internet provision industry*

*
*
*
*
*

Educational
Finance
Government
Communications and Media
Leisure and Hospitality

The service sector that is the fastest growing sector in terms of employment is:

*
*
*
*
*

Wholesale and retail trade


Transportation and warehousing
Financial activities
Professional and business services
Education and health services

The leisure and hospitality industry comprises a variety of services. Which of the following is not one of them*

*
*
*
*
*

food service
lodging
travel and tourism
meeting and convention planning
all the above are part of the hospitality industry

The leisure and hospitality sector accounted for what % of employment in Europe in 2007*

*
*
*
*
*

10.1
5.0
11.9
50
55

A large proportion of people employed in the hospitality and leisure sector are.

* Young
* In first job

* Female
* Part-time
* All of the above
The professional and business sector includes all of the following except:

*
*
*
*
*

computer services
legal advice
hospitals
accounting
architectural

Which sector should have the most concern for environmental issues*

*
*
*
*
*

Transport services
Professional and Business Services
Wholesale and Retail Trade
Education and Health Services
Other Services

Which of the following does not fit well within any of the sectors discussed*

*
*
*
*
*

pet services
health care
dentists
physicians
engineers

Most wholesalers are small, employing fewer than 50 workers. Which of the following is not an occupation in
which two-thirds of wholesalers work*

*
*
*
*
*

Administrative support
Sales
Transportation
Purchasing
Material-moving

Traditional service classification schemes include all of the following except:

*
*
*
*
*

the degree of tangibility


skill level of the provider
appearance of the provider
the degree of customer contact
the goal of the service providers

Subsequent service classification schemes include all the following except:

*
*
*
*
*

Labour intensiveness
Nature of the service
Relationship with the customer
Method of service delivery
Nature of demand relative to supply

According to the text, the obsession with the Internet began around ________.

* 1975
* 1982
* 1991

* 1996
* 2000
An e-service is a (an) __________ available via the net.

*
*
*
*
*

service
business process
application
information technology resource
all of the above

E-services are also called ___________.

*
*
*
*
*

ISPs
bASPs
Telcos
Aps-on-tap
Aggregators

To date, the most successful distribution of e-services has occurred through ______.

*
*
*
*
*

telecommunication companies (telcos)


Internet service providers (ISPs)
Enterprise resource planning (ERP) vendors
Application service providers/developers (ASPs)
Monolithic design coordinators (MDCs)

E-services have overcome many of the traditional challenges faced by service marketers. Which of the following is
not challenge overcome by the information-based services*

*
*
*
*
*

Intangibility
Homogeneity
Inseparability
Heterogeneity
Perishability

E-services can overcome some of the challenges provided by intangibility by which of the following*

*
*
*
*
*

Appearance of a website
Accuracy of information
Speed of the server
Ease of navigation
All of the above

Hotel rooms that are not sold on Thursday night cannot be added to the supply of rooms available for occupancy
on Friday night. E-services are not faced with these problems*

*
*
*
*
*

Perishability
Intangibility
Homogeneity
Inseparability
Heterogeneity

Replacing tasks that required human labour with machines is called:

*
*
*
*

Search
Quantization
Automation
Industrialization

* Customization
The breaking down of monolithic services into modular components is called:

*
*
*
*
*

Search
Quantization
Automation
Industrialization
Customization

The growth in the number of time-pressured consumers has led to an increase in time-saving services such as:

*
*
*
*
*

Restaurants
Housekeeping
Hairstyling shops
Tax preparation
All of the above

Which of the following statements about "woofs" is false*

* The term stands for "well-off older folks."


* Woofs control allege percentage of wealth and discretionary income.
* Woofs are engaged in "down aging"
* Woofs are at least partly responsible for the increase in demand for amusement and
recreation services.
* All the above are true
The migration of domestic jobs to foreign host countries is called:

*
*
*
*
*

Outservicing
Outsourcing
Offshoring
Industrialization
None of the above

The term that reflects the belief that without manufacturing, there will be less for people to service and more
people available to do less work is:

*
*
*
*
*

Materialismo snobbery
manufacturing superiority
industrial champions
manufacturing dichotomization
none of the above

The service industry criticism that low wages will possibly lead to dramatic changes in future governments is:

*
*
*
*
*

Materialismo snobbery
dichotomization of wealth
service industries are slow to adopt new technology
service productivity is weak
service inflation is difficult to control

Several guidelines to success become clear when examining the growth and dominance of the service sector.
Which of the following is not one of them*

*
*
*
*

Excel at niche marketing


Bigger is better
Master technological change
Excel at customer service

* Understand the value of customer retention


Focusing the firms marketing efforts toward the existing customer base is called:

*
*
*
*
*

Customer retention
Excellent customer service
Conquest retention
Courteous retention
None of the above

Which of the following statements pertaining to firm's customer retention efforts is true*

* The marketing costs associated with keeping customers are higher than the costs
associated with obtaining new customers
* Existing customers tend to purchase less services less frequently.
* Current customers are more efficient in their service transactions.
* Reducing customer defections by 5 percent can increase profits by as much as 90 percent.
* All of the above statements are false.
The pursuit of new customers as opposed to the retention of existing ones is called:

*
*
*
*
*

Services marketing
B2B marketing
Conquest marketing
Consumer marketing
All of the above

Chapter 4: The Consumer Decision Process In Services Marketing

Test Yourself on MIS


Show questions one by one
According to the text which one of the following statements is false*

* Many service firms continue to be operations dominated rather than customer oriented.
* Consumer orientation lies at the heart of the marketing concept.
* Researchers clearly understand how consumers make decisions.
* Differences exist between the way consumers make decisions regarding
services versus goods.
* All the above statements are true.
The consumer decision process consists of:

*
*
*
*
*

stimulus, problem awareness, and purchase stages


prepurchase, consumption, and postpurchase stages
problem awareness, evaluation of alternatives, and postpurchase behavior
stimulus, information search, and postpurchase behavior
information search, purchase, and postpurchase behavior

The prepurchase stage consists of all of the following activities except for:

*
*
*
*
*

the approach
problem awareness
information search
stimulus
evaluation of alternatives

Consumers determine a shortage or unfulfilled desire exists during which stage


of the consumer decision process.

* problem awareness

*
*
*
*

information search
evaluation of alternatives
postpurchase evaluation
the choice stage

Multiattribute models are used most during which stage of the consumer
decision process.

*
*
*
*
*

stimulus evaluation
problem awareness
information search
consumption stage
evaluation of alternatives

Bill's parents finally convinced him to get a haircut. Bill's decision process was
prompted by a:

*
*
*
*
*

physical cue
psychological cue
pressure cue
social cue
commercial cue

Which of the following is NOT an example of attribututes sought for Grants birthday*

*
*
*
*
*

location
fun atmosphere
talking to friends
service delivery
price

During the evaluation of alternatives stage, consumers sometime rely on their


"gut-level feelings." This type of decision making is called:

*
*
*
*
*

the lexicographic approach


a systematic approach
a nonsystematic approach
the linear compensatory approach
the evoked set approach

Using figure 4.1 on p86, multi-attribute choice matrix and the information below, which restaurant should be
selected for Grants birthday*:

*
*
*
*
*

TGI
Bonviveur
Casa Mia
Tapan-Yaki Japanese restaurant
Each customer's choice will differ based on their gut-level feelings.

Using figure 4.2 on p88, a model for post-purchase evaluation did Grant enjoy TGI Fridays:

* Yes
* No
Using figure 4.2 p88, a model for post-purchase evaluation; which two attributes did Grant perceive to be less than
expected and was therefore downgraded*

* fun atmosphere and location


* fun atmosphere and quality food
* fun atmosphere and price

* price and quality of food


* price and location
During which stage of the consumer decision process does acquisition,
production and consumption become an entangled process.

*
*
*
*
*

the prepurchase stage


the consumption stage
the postpurchase stage
the information search stage
the problem awareness stage

The _____ is the last step in the consumer decision process.

*
*
*
*
*

postpurchase stage
positioning stage
problem identification stage
prepurchase stage
consumption stage

According to the text, which one of the following is a type of perceived risk*

*
*
*
*
*

financial risk
performance risk
social risk
psychological risk
all of the above

Co-producer risk is directly related to the concept of ______.

*
*
*
*
*

intangibility
heterogeneity
inseparability
perishability
nonstandardization

Which of the following statements is not true*

* service purchases are perceived as riskier than goods purchases


* the participation of the consumer in the service process increases the
amount of perceived risk
* the variability in services increases the perceived risk associated with the
purchase
* consumers of services have less prepurchase information versus goods
* services are primarily characterized by search attributes
Attributes such as price, fit, and feel are called:

*
*
*
*
*

experience
credence
clearwater
revival
search

Services are primarily characterized by

* search attributes
* experience attributes
* credence attributes

* a and b
* b and c
The reason services have few search attributes is primarily attributed to:

*
*
*
*
*

inseparability
heterogeneity
intangibility
perishability
nonstandardization

Which of the following statements is not correct*

* Service consumers are more brand loyal


* Personal sources of information are more important to service consumers
versus nonpersonal sources
* Service consumers have fewer alternatives to consider
* Self-service is a viable alternative for many services
* Customers always prefer customized services to standardized services
Service consumers tend to be more brand loyal than goods consumers
because _____.

*
*
*
*
*

More choices are available.


Brand loyalty lowers the amount of perceived risk.
Each service provider provides many brands.
The prices of their main provider are usually less expensive.
Location of the provider is the major driver in the consumer selection process.

The costs associated with changing from one provider to another are referred to
as:

*
*
*
*
*

performance costs
economic costs
selection costs
switching costs
financial costs

The switching costs associated with the time it takes simply thinking about making a change in service providers is
called:

*
*
*
*
*

emotional costs
cognitive costs
learning costs
performance costs
customer habit costs

Switching costs generally associated with changing from one service provider to
another include all of the following except for:

*
*
*
*
*

performance costs
loyal customer discounts
emotional costs
cognitive costs
search costs

When changing dentists, the patient was required to pay for a new set of X-rays.
This type of switching costs is referred to as:

* performance costs

*
*
*
*

loyal customer discounts


emotional costs
cognitive costs
transaction costs

Consumers of services tend to rely on personal sources of information


more than nonpersonal sources for all of the following reasons except:

* Many service providers are small and lack the resources or expertise to
use nonpersonal sources.
* Opinion leaders play an important role in the purchase of services.
* Due to intangibility, mass media is an effective tool for communicating
with service consumers.
* The use of personal sources reduces the risk associated with the
purchase.
* Professional restrictions may limit the use of nonpersonal sources of information
in some service sectors.
With regards to the number of service alternatives available, which of the
following statements is false*

* Consumers are aware of fewer alternatives because less prepurchase


information is available.
* Self-service, in some instances, is a viable alternative.
* In general, individual service providers tend to offer only one brand of service.
* The evoked set for services is smaller.
* All the above statements are correct.
Which of the following statements about the consumption stage of the consumer
decision process for services is not correct*

* The activities of buying, using, and disposing occur in a definite order and have clear
boundaries between them.
* The concept of disposal is irrelevant with regards to services.
* The consumption stage is more complex for services than goods.
* Consumer evaluation of the service occurs during and after consumption.
* Service marketers are able to change consumer evaluations during the service
encounter.
Postpurchase models attempt to describe the process by which consumers
evaluate their purchase decisions. Which of the following models evaluates
services by comparing expectations with perceptions*

*
*
*
*
*

the role congruence model


the perceived-control model
the expectancy disconfirmation model
the script perspective
the Servuction model

The postpurchase model in which consumers evaluate services by the amount of


influence they have over the service encounter is:

*
*
*
*

the role congruence model


the perceived-control model
the expectancy disconfirmation model
the script perspective

* the Servuction model


The postpurchase model which is based on the idea that in a service encounter,
customers and employees perform roles, and that satisfaction is a function of
role congruence--where actual behaviors are consistent with expected roles is
called:

*
*
*
*
*

the dissonance model


the perceived-control model
the expectancy disconfirmation model
the script perspective
the Servuction model

What type of control has the ability to control what is actually going on*

*
*
*
*
*

Behavioral control
Cognitive control
Service control
Perception of control
None of the above

Roles differ from scripts in that roles are:

*
*
*
*
*

extra-individual
intra-individual
capable of being modified through training
modified over time with experience
flexible

Scripts differ from roles in that scripts are:

*
*
*
*
*

extra-individual
inflexible
written
intra-individual
performed by both employees and customers

Scripts differ from roles in that:

*
*
*
*
*

scripts also concern the impact of the service setting


scripts and roles are terms used to describe the same subject
roles are intra-individual
scripts are extra-individual
scripts cannot be modified via training and experience

Chapter 5: Researching Service Markets

Test Yourself on MIS


Show questions one by one
Using information gathered from a range of sources can create...

*
*
*
*

new customers
new markets
competitive advantage
none of the above

What is a marketing information system*

* An automated way of delivering the service to customers


* A formal or informal process of managing the information gathered by an organisation
* Computer software only

* A filing cabinet
* A method for gathering information
Competitor intelligence should be gathered once a year

* True
* False
Information gathered to address a particular marketing problem or requirement is

*
*
*
*
*

Environmental scanning
Government statistics
marketing research
not often needed
internal data only

Which type of data comes from the day to day running of the organization*

*
*
*
*
*

Internal data
External data
Government statistics
Market surveys
Only quantitative

Which type of information comes from industry published reports*

*
*
*
*
*

Internal data
Secondary data
Only qualitative
Operating data
Only quantitative

A service company shuld gather data for...

*
*
*
*
*

objective setting
customer analysis
competitor analysis
long term planning
all of the above

Which one of the following provides quantitative data*

*
*
*
*
*

minutes of meetings
newspaper articles
discussion with sales force
regional sales statistics
telephone call from angry customer

Which one of the following provides qualitative data*

*
*
*
*
*

Debrief meeting with client


Statistical analysis of customer survey
Competitor sales figures
Market share information
Attitude ratings

Which of the following is not a method for administering a survey*

* Online
* Post
* Telephone

* In person
* experiment
Focus groups should

*
*
*
*
*

Consist of several participants


Be run by an experienced facilitator
Focus on areas of interest
Gather in-depth qualitative data
all of the above

Gathering in-depth qualitative data from an individual is best done via

*
*
*
*
*

a tick box survey


a focus group
observation
in-depth interview
secondary data

Mystery shopping is

*
*
*
*
*

Buying items that are not needed


Researching a service by experiencing it as a customer would
Spying on service employees
Observing overtly
A form of survey

Which of the following in untrue*


Observation can be.

*
*
*
*
*

overt or covert
used to understand motivation and attitude
used to study customer movements
used to gather quantitative and qualitative data
done via video

One of the main problems with experiments in service industry situations is

*
*
*
*
*

cost
the information they provide
controlling all the variables
customers dont like them
animal rights campaigners

What percentage of data should come from outside of the firm:

*
*
*
*
*

80%
20%
15%
75%
0%

What should be at the centre of any marketing information system*

*
*
*
*

A computer
An IT expert
Stakeholder information files
Financial information

* A survey
Information overload occurs when

*
*
*
*
*

consumers are told too much


storage space is limited
there are too few staff
no marketing research is undertaken
there is a mismanaged quantity of information

A successful information system requires little in terms of staff resources and expertise.

* True
* False
In using information on customers service companies should.

*
*
*
*

ensure they have permission to do so


comply with the Data Protection Act
behave ethically
all of the above

Chapter 6: Service Development and Innovation

Test Yourself on MIS


Show questions one by one
In the UK and Germany what percentage of the workforce are employed in service organizations*

*
*
*
*
*

8%
5%
15%
2%
20%

It is important for organizations to change and develop. The stages that service organisations go through are
known as the Product Life Cycle. The Product Development Stage refers to:

*
*
*
*
*

ideas conceived and researched


ideas conceived and launched
research and launch
research and awareness building
none of the above

It is important for organizations to change and develop. The stages that service organisations go through are
known as the Product Life Cycle. The Introduction Stage refers to:

*
*
*
*
*

introducing a change to the service


introducing new service overseas
introducing new ideas to the market
introducing existing services to new markets
none of the above

It is important for organizations to change and develop. The stages that service organisations go through are
known as the Product Life Cycle. The Growth Stage refers to:

*
*
*
*
*

growth of the new service in the minds of employees


introduction of new services to grow the portfolio of the company
grow advertising spend to loyal customers
raise awareness new service to new customer
none of the above

It is important for organizations to change and develop. The stages that service organisations go through are
known as the Product Life Cycle. The Maturity Stage refers to:

*
*
*
*
*

sales reach their peak


new services are targeted at the mature market
sales with the mature market are declined
sales begin to grow in the mature market
none of the above

It is important for organizations to change and develop. The stages that service organisations go through are
known as the Product Life Cycle. The Saturation Stage refers to:

*
*
*
*
*

All competitors leave the market place


New competitors join the market place
Many competitors seeking the same customers
All competitors seek the same customers
None of the above

It is important for organizations to change and develop. The stages that service organisations go through are
known as the Product Life Cycle. The Decline Stage refers to:

*
*
*
*
*

Sales decline but remain profitable


Profitability improves and sales decline
Sales increase and profitability declines
Profitability declines and sales decline
none of the above

Which of the following was NOT discussed as a Driver for Service Change*

*
*
*
*
*

Regulations
Perishability
Consumer
Competitors
Seasonal patterns

Which strategy option is more intense than others*

*
*
*
*
*

sell new services to existing customers


sell more existing services to existing customers
sell existing services o new customers
sell new services to new customers
all of the above

The characteristics of what and when new services are delivered and how they are delivered to the customer are
called:

*
*
*
*
*

continuum of new service development


service delivery continuum
continuum of service delivery
new service and customer delivery continuum
customer delivery continuum

Niklas Zenstrom and Janus Friis created a new internet service called Skype.
Which new service development did they introduce*

*
*
*
*

Major process innovation


Process-line extensions
Service improvements
Style changes

* Major service innovations


Top Shop recently introduced a Personal Shopper at some of the larger stores.
Which new service development did they introduce*

*
*
*
*
*

Major process innovation


Process-line extensions
Service improvements
Style changes
Major service innovations

The Polish Open University (POU) offers two modes of study in two different languages. Considering the E-learning
mode of study, in English or Polish at POU, which service development did they introduce*

*
*
*
*
*

Major process innovation


Process-line extensions
Product-line extensions
Style changes
Major service innovations

BA recently introduced BA CityFlyer. Which service development did they introduce*

*
*
*
*
*

Major process innovation


Process-line extensions
Product-line extensions
Style changes
Major service innovations

First Bus employees recently received their staff uniform. The blazer now includes a pocket on the inside so hold a
mobile phone; an item given to all drivers to report emergencies or breakdown* The new blazers development to
service is classed as:

*
*
*
*
*

Major process innovation


Process-line extensions
Service improvements
Style changes
Major service innovations

Creating an environment for innovation and creativity is important. To encourage innovation and creativity 8
activities should be included. Which of the following includes autonomy, independence and initiative*

*
*
*
*
*

Risk-taking
Playfulness and humour
Idea time
Freedom
Debate

Creating an environment for innovation and creativity is important. To encourage innovation and creativity 8
activities should be included.
Which of the following includes spontaneity, fun and laughter*

*
*
*
*
*

Risk-taking
Playfulness and humour
Idea time
Freedom
Debate

Creating an environment for innovation and creativity is important. To encourage innovation and creativity 8
activities should be included.
Which of the following includes tolerance of uncertainty, ambiguity and the chance to take a gamble*

*
*
*
*
*

Risk-taking
Playfulness and humour
Idea time
Freedom
Debate

Creating an environment for innovation and creativity is important. To encourage innovation and creativity 8
activities should be included.
Which of the following includes encounters with others and disagreement*

*
*
*
*
*

Risk-taking
Playfulness and humour
Idea time
Freedom
Debate

Creating an environment for innovation and creativity is important. To encourage innovation and creativity 8
activities should be included.
Which of the following includes flexible deadlines, flexible opportunities to explore and develop ideas*

*
*
*
*
*

Risk-taking
Playfulness and humour
Idea time
Freedom
Debate

The new service development process includes several stages. Which stage means organisations have to consider
sales, set-up costs and profitability*

*
*
*
*
*

Hire and train personnel


Cross-functional team
Pilot run
Idea generation
Business analysis

The new service development process includes several stages. Which stage means organisations have to stimulate
the customer/personnel interface and role-play all situations*

*
*
*
*
*

Hire and train personnel


Cross-functional team
Pilot run
Idea generation
Business analysis

The new service development process includes several stages. Which stage means organisations have to ensure
staff across all department work together and know their role*

*
*
*
*

Hire and train personnel


Cross-functional team
Pilot run
Idea generation

* Business analysis
The new service development process includes several stages. Which stage means organisations have to review
comments from customer comments cards, B2B feedback and market trends*

*
*
*
*
*

Hire and train personnel


Cross-functional team
Pilot run
Idea generation
Business analysis

The new service development process includes several stages. Which stage means organisations have to advertise
and recruit employees*

*
*
*
*
*

Hire and train personnel


Cross-functional team
Pilot run
Idea generation
Business analysis

The service industry has several emerging trends that organisations need to be aware of. Which of these should
organisations keep a look out for*

*
*
*
*
*

new competitors entering the marketplace


advances in the internet
heightened customer expectations
advances in e-commerce
all of the above

Chapter 7: Service Delivery Process

Test Yourself on MIS


Show questions one by one
The manner in which operational competitiveness is embraced by various service firms can be described by all
the following stages except:

*
*
*
*
*

available for service


marketing and operations
journeyman
distinctive competencies achieved
world-class service delivery

Customers ultimately determine:

*
*
*
*
*

the type of demand


the levels of marketing effectiveness and operational efficiency
the cycle of demand
the length of the service experience
all of the above

The place within an organization where its primary operations are conducted is called:

*
*
*
*
*

technical core
organizational point
factory
main system
none of the above

The strategy of breaking up large, unfocused plants into smaller units buffered from one another so that each can
be focused separately is referred to as:

*
*
*
*
*

the perfect-world model


operations segmentation
the plant-within-a-plant concept
operations segregation
management by focus

The major goal of the plant-within-a-plant-concept is to:

* produce a variety of services in one location


* reduce operating costs
* provider quicker response times to market demand
* break up large, unfocused plants into smaller units buffered from
one another so that each can be focused separately
* none of the above
According to Thompson's Perfect-world model, perfect efficiency occurs
when:

* employees understand their jobs


* role congruence occurs between customers and employees
* inputs, outputs, and quality happen at a constant rate and remain known
and certain
* customer needs are being met
* when the operation concentrates on performing one particular task in one
particular part of the plant
Strategies to increase the efficiency of service operations include all of the
following except:

*
*
*
*
*

buffering
smoothing
anticipating
rationing
all the above

The strategy that resorts to triage when the demands placed on the system by the environment exceed its ability
to handle them is referred to as:

*
*
*
*
*

buffering
smoothing
anticipating
rationing
allocating

The strategy that surrounds the technical core of the operation with input
and output components is called:

*
*
*
*
*

buffering
smoothing
anticipating
rationing
all the above

Which of the following strategy is not on the list regarding overcoming some of the problems of service
operations*

* isolating the technical core


* production-lining the whole system

* creating flexible capacity


* increasing customer participation
* maximizing the servuction system
The objective of decoupling is:

* separating consumption in time and space


* unbundling services so that the may be purchased separately
* separating the technical core of the operation from the high customer
contact areas of the firm so that efficiencies may be achieved
* managing consumers so that they do negatively influence one anothers
service experience
* separating co-workers who, due to their differences, decrease the
operational efficiency of the system
Production-lining a service operation can be achieved through:

*
*
*
*
*

utilizing hard technologies


customizing services
utilizing soft technologies
meeting individual customer needs
a and c

With regards to the concept of "production-lining", the rules, regulations, and procedures that facilitate the
production of a standardized product are called:

*
*
*
*
*

guidelines
specifications
soft technologies
organizational standards
codes of conduct

Soft technologies refer to:

* the personal touches that ultimately lead to customer satisfaction


* flexible rules that can be bent to meet customer needs
* guidelines that permit employee empowerment
* hardware that facilitates the production of a standardized product
* rules, regulations, and procedures that facilitate the production of a
standardized product
An Automatic Teller Machine (ATM) is an example of:

*
*
*
*
*

hard technology
soft technology
the perfect-world-model
complexity
divergence

One of the most common techniques used to analyze and manage


complex processes is:

*
*
*
*
*

CAD analysis
blueprinting
sequencing
process analysis
decoupling

Blueprints identify all of the following process steps except:

*
*
*
*
*

the direction in which processes flow


the time it takes to move from one process to the next
the costs involved with each process site
the amount of inventory build-up at each step
all the above are identified in a flowchart

With regards to constructing a service blueprint, the time required to perform one activity at one station is called:

*
*
*
*
*

process time
activity time
maximum output per hour
operation time
bottleneck time

The following question is based on the below cafeteria flowchart and the information provided in the table.
Customers start at counter A and move to Counter B. Customers then choose one of two counter Cs and then
move on toward Counter D. Customers then choose one of two counter Es and then move on toward Counter E.

What is the activity time for Counter C*

*
*
*
*

10 seconds
20 seconds
30 seconds
45 seconds

* 60 seconds
The following question is based on the below cafeteria flowchart and the information provided in the table.
Customers start at counter A and move to Counter B. Customers then choose one of two counter Cs and then
move on toward Counter D. Customers then choose one of two counter Es and then move on toward Counter E.

What is the process time for Counter E*

*
*
*
*
*

10 seconds
15 seconds
20 seconds
30 seconds
60 seconds

The following question is based on the below cafeteria flowchart and the information provided in the table.
Customers start at counter A and move to Counter B. Customers then choose one of two counter Cs and then
move on toward Counter D. Customers then choose one of two counter Es and then move on toward Counter E.

Which of the following counters produces a maximum output per hour of


240 customers*

*
*
*
*
*

Counter A
Counter B
Counter C
Counter D
Counter E

The following question is based on the below cafeteria flowchart and the information provided in the table.
Customers start at counter A and move to Counter B. Customers then choose one of two counter Cs and then
move on toward Counter D. Customers then choose one of two counter Es and then move on toward Counter E.

How many customer can this cafeteria process in an hour*

*
*
*
*
*

360
120
90
240
180

The following question is based on the below cafeteria flowchart and the information provided in the table.
Customers start at counter A and move to Counter B. Customers then choose one of two counter Cs and then
move on toward Counter D. Customers then choose one of two counter Es and then move on toward Counter E.

Based on its current configuration, the cafeteria's service cost per meal is:

*
*
*
*
*

$42.00
$ .11
$ .46
$ 2.14
$ .62

The following question is based on the below cafeteria flowchart and the information provided in the table.
Customers start at counter A and move to Counter B. Customers then choose one of two counter Cs and then
move on toward Counter D. Customers then choose one of two counter Es and then move on toward Counter E.

Where is the bottleneck located in this example*

*
*
*
*
*

Counter A
Counter B
Counter C
Counter D
Counter E

The following question is based on the below cafeteria flowchart and the information provided in the table.
Customers start at counter A and move to Counter B. Customers then choose one of two counter Cs and then
move on toward Counter D. Customers then choose one of two counter Es and then move on toward Counter E.

If an extra counter is added at the bottleneck location, how many customers can the cafeteria process in an hour*

*
*
*
*
*

360
120
90
240
180

The following question is based on the below cafeteria flowchart and the information provided in the table.
Customers start at counter A and move to Counter B. Customers then choose one of two counter Cs and then
move on toward Counter D. Customers then choose one of two counter Es and then move on toward Counter E.

If an extra counter is located at the bottleneck location, what is the new service cost per meal*

*
*
*
*
*

$49.00
$ .52
$ .46
$ 2.14
$ 1.90

A service operation consists of four stations. Station One can process 150 customers per hour. Station Two can
process 300 customers per hour. Stations Three can process 100 customers per hour, and Station Four can process
150 customers per hour. What is the maximum number of customers the entire operation can process in an hour*

*
*
*
*
*

700
300
150
100
none of the above

The __________ is calculated by dividing the activity time by the number of locations at which the activity is
performed.

*
*
*
*
*

service cost per meal


maximum output per hour
process time
activity time
bottleneck time

The most common mistake made when constructing a service blueprint is:

* bottlenecks are not identified correctly


* failure points are not identified correctly
* the blueprint is one-sided
-representing only the firm's perception of the process
* script norms are misunderstood
* the time frame for service execution is miscalculated
Which of the following is not a step in the construction process of a service
blueprint*

*
*
*
*
*

obtaining scripts from both customers and employees


segmenting customers based on the content of the script
dentify steps in the process where the system can go awry
calculating the time frame for service execution
analyzing the profitability of the system

A volume-oriented positioning strategy is achieved by:

*
*
*
*
*

increasing divergence
reducing divergence
increasing complexity
reducing complexity
unbundling the service

The positioning strategy that increases divergence so that the operation can tailor the service experience to each
customer is referred to as:

*
*
*
*
*

niche positioning strategy


volume-oriented positioning strategy
specialization positioning strategy
penetration strategy
market diversification strategy

A specialization positioning strategy is accomplished by:

*
*
*
*
*

increasing divergence
reducing divergence
increasing complexity
reducing complexity
unbundling the service

The positioning strategy that increases complexity by adding more services and/or enhancing current services to
capture more of the market is referred to as:

*
*
*
*
*

niche positioning strategy


volume-oriented positioning strategy
specialization positioning strategy
penetration strategy
market diversification strategy

Divesting an operation of different services and concentrating on providing only one or a few services in order to
pursue a specialization position strategy is called:

*
*
*
*

increasing divergence
reducing divergence
increasing complexity
unbundling the service

* none of the above


Chapter 8: The Pricing of Services

Test Yourself on MIS


Show questions one by one
A buyer's perception of value is considered a tradeoff between:

*
*
*
*
*

product value and psychic cost


total customer value and total customer cost
image value and energy cost
service value and monetary cost
personnel value and time cost

Total customer value consists of all of the following components except:

*
*
*
*
*

product value
service value
image value
time value
personnel value

Total customer cost consists of all of the following components except:

*
*
*
*
*

monetary cost
social cost
time cost
psychic cost
energy cost

Consumers exchange their money, time, and effort for the bundle of benefits the service offers. Theory suggests
that consumers will have a ___________ that captures the value they place on these benefits.

*
*
*
*
*

lower price threshold


reservation price
consumer surplus
image value
product value

When pricing a service, the service provider should consider all of the following except __________.

*
*
*
*
*

demand considerations
cost considerations
customer considerations
product considerations
all the above should be considered

A consumers price sensitivity will increase as:

*
*
*
*
*

the perceived number of substitutes increase


switching costs increase
the shared costs for the expenditure increase
the perceived unique value of the service increases
the customers ability to build an inventory decreases

A consumers price sensitivity will increase as:

* the perceived number of substitutes decrease


* switching costs increase
* the shared costs for the expenditure increase

* the perceived unique value of the service increases


* the customers ability to build an inventory increases
A consumers price sensitivity will decrease as:

*
*
*
*
*

the perceived number of substitutes increase


switching costs increase
the shared costs for the expenditure decreases
the perceived unique value of the service decreases
the customers ability to build an inventory increases

A consumers price sensitivity will decrease as:

*
*
*
*
*

the perceived number of substitutes increase


switching costs decrease
the shared costs for the expenditure increase
the perceived unique value of the service decreases
the customers ability to build an inventory increases

Which of the following statements about the pricing of services (compared to the pricing of goods) is false*

*
*
*
*
*

The demand for services tends to be more elastic than the demand for goods.
Cost-oriented pricing is more difficult for services.
Comparing prices of competitors is more difficult for service consumers.
Self-service is a viable competitive alternative.
Consumers are less able to stockpile services by taking advantage of discount prices.

Which of the following statements about the pricing of services (compared to the pricing of goods) is false*

*
*
*
*
*

The demand for services tends to be more inelastic than the demand for goods.
Cost-oriented pricing is more difficult for services.
Comparing prices of competitors is more difficult for service consumers.
Self-service is a viable competitive alternative.
Consumers are more able to stockpile services by taking advantage of discount prices.

Which of the following statements about the pricing of services (compared to the pricing of goods) is true*

*
*
*
*
*

The demand for services tends to be more elastic than the demand for goods.
Cost-oriented pricing is more difficult for services.
Comparing prices of competitors is less difficult for service consumers.
Self-service is not a viable competitive alternative.
Consumers are more able to stockpile services by taking advantage of discount prices.

Which of the following statements about the pricing of services (compared to the pricing of goods) is true*

*
*
*
*
*

The demand for services tends to be more elastic than the demand for goods.
Cost-oriented pricing is less difficult for services.
Comparing prices of competitors is less difficult for service consumers.
Self-service is a viable competitive alternative.
Consumers are more able to stockpile services by taking advantage of discount prices.

The mental energy spent by customers to acquire service is referred to as _____.

*
*
*
*
*

image costs
monetary price
energy costs
psychic costs
time costs

Brand equity is most similar to:

*
*
*
*
*

psychic value
image value
service value
product value
personnel value

If the negative effect of cross-price elasticity in which the increasing price of one service decreases the demand for
another service are said to be __________.

*
*
*
*
*

unitary
substitutes
complementary
inelastic
elastic

If the positive effect of cross-price elasticity in which the increasing price of one service increases the demand for
another service are said to be __________.

*
*
*
*
*

unitary
substitutes
complementary
inelastic
elastic

Which of the following is not a criteria for effective price discrimination*

*
*
*
*
*

the segments should be identifiable, and a mechanism must exist to price them differently.
different groups of consumers should have similar responses to price
segments should be large enough to be profitable
incremental revenues should exceed incremental costs
customers should not be confused

If the goal of the pricing strategy is to reduce the amount of perceived risk associated with the purchase and
appeal to target markets that value certainty, then the appropriate pricing strategy would be:

*
*
*
*
*

relationship pricing
price bundling
mixed bundling
efficiency pricing
flat-rate pricing

Which one of the following is not a form of satisfaction-based pricing*

*
*
*
*
*

offering guarantees
benefit-driven pricing
flat-rate pricing
relationship pricing
all the above are forms of satisfaction-based pricing

The pricing strategy that charges customers for services actually used as opposed to overall "membership" fees is:

*
*
*
*
*

relationship pricing
price bundling
benefit-driven pricing
flat-rate pricing
efficiency pricing

The pricing strategy that enhances the firm's relationship with its targeted consumers and is a form of relationship
pricing is:

*
*
*
*
*

activity-based costing
price bundling
benefit-driven pricing
flat-rate pricing
efficiency pricing

Southwest airlines appeals to economically-minded consumers who are looking for the best price by flying shorter,
more direct routes to less congested, less expensive airports. Southwest Airlines practices:

*
*
*
*
*

relationship pricing
price bundling
benefit-driven pricing
flat-rate pricing
efficiency pricing

Traditionally, overhead in most service firms has been allocated to projects based on the amount of ____________
charged to complete the customer's requirements.

*
*
*
*
*

direct labor
fixed costs
time
number of employees
number of time sheet entries

The approach that allocates overhead to each project based on the activities undertaken to complete the project is
called:

*
*
*
*
*

activity-based costing
price bundling
benefit-driven pricing
flat-rate pricing
efficiency pricing

Customer frustration resulting from receiving poor service is most similar to:

*
*
*
*
*

image costs
monetary price
energy costs
psychic costs
time costs

many services, the demand for medical services tends to be __________.

*
*
*
*
*

inelastic
elastic
substitute demand
complementary demand
price cross elastic demand

Effective boundary spanners enhance the __________ of services.

*
*
*
*
*

product value
service value
image value
time value
personnel value

Costs that are planned and are accrued during the operating period regardless of the level of production and sales
are called:

*
*
*
*
*

fixed costs
direct variable costs
average costs
marginal costs
future costs

Costs such as direct labour and sales commissions are called:

*
*
*
*
*

fixed costs
variable costs
average costs
marginal costs
future costs

Charging customers different prices for essentially the same service is called:

*
*
*
*
*

price discrimination
supply and demand
complementary
substitutes
none of the above

The tasks in activity based costing are thought of as users of overhead and identified as:

*
*
*
*
*

fixed costs
cost drivers
variable costs
project costs
cost labor

Technique that allows consumers to either buy Service A and Service B together
or purchase one service separately is called:

*
*
*
*
*

long-term bundling
price bundling
mixed bundling
relations bundling
product bundling

Which pricing strategies encourage the customer to expand his/her dealings with the service provider*

*
*
*
*
*

relationship pricing
price bundling
benefit-driven pricing
flat-rate pricing
efficiency pricing

Studies suggest that price is more likely to be used as a cue to quality under the following conditions*

*
*
*
*
*

when price is the primary differential information available


when alternatives are heterogeneous
prior to purchase
when comparative price differences are relatively large
all of the above

Chapter 9: Developing the Service Communications Mix

Test Yourself on MIS


Show questions one by one

Communication channels that are considered impersonal, such as television advertising or printed information are
called:

*
*
*
*
*

nonpersonal sources
personal sources
impersonal sources
face-to-face sources
noncommunication sources

The primary role of a service firm's communication mix is to:

*
*
*
*
*

remind customers
persuade customers
inform customers
all of the above
none of the above

Which of the following is not an element of a service firm's communication mix*

*
*
*
*
*

personal selling
sales promotion
positioning strategy
advertising
publicity and public relations

The plan for differentiating the firm from its competitors in consumer's eyes is referred to as the firm's:

*
*
*
*
*

communication mix
positioning strategy
publicity
public relations
target marketing

Differentiation approaches such as competence, courtesy, reliability, and responsiveness are forms of:

*
*
*
*
*

product differentiation
personnel differentiation
image differentiation
service differentiation
satisfaction differentiation

Differentiation approaches such as delivery, installation, customer training, and repair are forms of:

*
*
*
*
*

product differentiation
personnel differentiation
image differentiation
service differentiation
satisfaction differentiation

According to the text, the appropriate communication content during the introduction stage of the product life
cycle would be:

*
*
*
*
*

informational
informational and persuasive
persuasive
persuasive and reminder
reminder

Which of the following is not a communication objective during the maturity and decline stages of the product life
cycle*

*
*
*
*
*

encourage repeat purchases


provide an ongoing contact with customers
prepare the way for personal selling efforts
express gratitude to the existing customer base
confirm past purchase decisions

Which one of the following communication approaches would be appropriate during the growth and maturity
stages of the product life cycle*

*
*
*
*
*

informational
informational and persuasive
persuasive
persuasive and reminder
reminder

When targeting users versus nonusers, which form of communication, can be used more often with the former
than the latter*

*
*
*
*
*

publicity
advertising
service provider
public relations
sales promotions

Service staff that are required to deal with customers quick and effectively in "once only" situations where large
numbers of customers are present are called:

*
*
*
*
*

type 1 staff
type 2 staff
type 3 staff
type 4 staff
type 5 staff

The typical McDonald's employee who works the front counter would be considered:

*
*
*
*
*

type 1 staff
type 2 staff
type 3 staff
type 4 staff
type 5 staff

Banking personnel would be considered:

*
*
*
*
*

type 1 staff
type 2 staff
type 3 staff
type 4 staff
the answer would vary depending on their job in the bank

Consultants who have to have more highly developed communication skills because of more extended and
complex interactions with customers would be considered:

*
*
*
*
*

type 1 staff
type 2 staff
type 3 staff
type 4 staff
type 5 staff

Staff that predominantly fill an operations role are considered:

*
*
*
*
*

type 1 staff
type 2 staff
type 3 staff
type 4 staff
type 5 staff

According to the text, the primary objective of a firm's communication mix during the preconsumption choice
stage is to:

* make the sell


* minimize the perceived risk associated with the purchase
* encourage repeat purchases
* persuasively convince customers why the firm's brand is superior to the
competition's
* use advertising to prepare the way for personal selling efforts
The perceived consequences of a consumers purchase decision are:

*
*
*
*
*

financial
social
performance
all of the above
none of the above

Multi-attribute models, such as the rational mathematician model, utilize a choice matrix of attributes, brand
scores, and importance weights. Communications can be used to try to influence consumer choice by:

*
*
*
*
*

altering the weights consumers attach to different attributes


altering the score on a given attribute for the company
altering the score on a given attribute for a competitor
build awareness so that the company is included in the evoked set
all of the above

According to the text, the primary objective of a firm's communication mix during the consumption stage is to:

* make the sell


* minimize the perceived risk associated with the purchase
* encourage repeat purchases
* persuasively convince customers why the firm's brand is superior to the competition's
* provide the consumer with a clear script so that they may perform their production role
successfully
Which of the following communication objectives becomes the most important
during the postconsumption evaluation stage*

*
*
*
*
*

informing customers
managing customer expectations
reducing consumer perceived risk
persuading customers
becoming part of the customer's evoked set of alternatives

An objective, measurable level of performance produced by the operating system of the firm is called:

*
*
*
*

mistargeted communication
managing expectations
technical service quality
perception

* none of the above


Word-of-Mouth communication networks are particularly important for service firms because:

*
*
*
*
*

service customers tend to rely more on personal than nonpersonal source of information
service firms only offer one brand of service
service firms can seldom afford to pay for promotional efforts
the inseparability of service performance
service customers tend to rely more on nonpersonal than personal sources of information

The suggested communication strategy to use when the product is intangible dominant is to:

*
*
*
*
*

create an intangible image for the product


create awareness for the product
surround the product with tangible evidence
make sure the product is in the evoked set of alternatives
differentiate the service product from service delivery

The suggested communication strategy to use when the product is tangible dominant is to:

*
*
*
*
*

create an intangible image for the product


create awareness for the product
surround the product with tangible evidence
make sure the product is in the evoked set of alternatives
differentiate the service product from service delivery

The suggested communication strategy to use when the service firm is a restaurant that offers food and service is
to:

*
*
*
*
*

create an intangible image for the product


create awareness for the product
surround the product with tangible evidence
differentiate the service product from service delivery
both a and c

Which of the following is not a recommended guideline for developing service communications*

*
*
*
*
*

tangibilize the intangible


promise what is possible
reduce consumer fears about variation in performance
make the service more abstract
feature the working relationship between provider and customer

Churchills dog is a good example of which of the following guidelines for developing service communications*

*
*
*
*
*

tangibilize the intangible


promise what is possible
reduce consumer fears about variation in performance
make the service more abstract
feature the working relationship between provider and customer

A firm that offers "service guarantees" is attempting to accomplish which of the following guidelines for
developing service communications*

*
*
*
*
*

tangibilize the intangible


develop a word-of-mouth communication's network
reduce consumer fears about variation in performance
feature the working relationship between provider and customer
none of the above

__________ is an overall favorable impression or unfavorable impression based on early stages of the service
encounter.

*
*
*
*
*

cognitive dissonance
environmental stimulus
visual pathway
halo effect
technical service quality

E-marketing communications have the advantage of...

*
*
*
*

reaching a widely dispersed audience


being cost effective
being personalized
all of the above

A disadvantage of e-marketing is

*
*
*
*

high cost
low reach
loss of personal contact
all of the above

Chapter 10: Managing the Firm's Physical Evidence

Test Yourself on MIS


Show questions one by one
Which of the following is not a component of a service firm's physical evidence*

*
*
*
*
*

parking
employee appearance
billing statements
business equipment
customer satisfaction

Which of the following is not a component of a service firm's physical evidence*

*
*
*
*
*

exterior design
landscaping
firm brochures
parking
all the above are components of a firm's physical evidence

Which of the following is NOT an element of the physical evidence for a Dance Studio*

*
*
*
*
*

its parquet dance floor


its ad in the local newspaper
how experienced its dance instructors are
its website
a brochure describing its dance lessons and its various payment plans

Which of the following is not a major role of a service firm's physical evidence*

*
*
*
*
*

socializing employees and customers


providing a means for differentiation
providing a means for customer price comparisons
facilitating the flow of the service delivery process
packaging the service

According to the text, one of the advantages of requiring employees to wear uniforms is that it reduces the
customer's perception of __________.

*
*
*
*
*

intangibility
inseparability
heterogeneity
socialization
perishability

According to the text, which of the following is not an advantage of requiring employees to wear uniforms*

*
*
*
*
*

identifies the firm's personnel


assists in controlling deviant members
provides price expectations to customers
implies a coherent group structure
provides a physical symbol that embodies the group's ideals and attributes

Pregnant military personnel were originally permitted to wear civilian clothing when pregnant in lieu of their
traditional military uniforms. After implementing this policy, the military observed:

* grateful personnel who could now wear their own clothes


* jealousy from other personnel who were required to wear uniforms
* a wide array of dress styles on base
* personnel who were upset because they now had to worry about what to wear everyday
* discipline and morale problems because these personnel had begun to lose their
identification with their roles as soldiers
__________ is the study of the use of physical evidence to create service environments and its influence on the
perceptions and behaviors of individuals.

*
*
*
*
*

ergonomics
environmental psychology
physics
physical sociology
environmental anthropology

The __________ model helps explain the effects of the service environment on consumer behavior.

*
*
*
*
*

Servuction model
scale of market entities
conceptual model of service quality
service blueprint
stimulus-organism-response

The component of the SOR model which describes the recipient of environmental stimuli is:

*
*
*
*
*

stimulus receiver
organism
organizations
responder
stimuli receptor

The emotional state that reflects feelings of control and the ability to act freely within the service environment is
referred to as:

*
*
*
*
*

pleasure-displeasure
arousal-nonarousal
approach-avoidance
dominance-submissiveness
cognitive-physiological

Consumer responses to environmental stimuli are characterized by approach or avoidance behaviors. Consumer
approach behavior is defined as:

*
*
*
*
*

a desire to stay
a desire to explore
a desire to communicate
feelings of satisfaction
all the above are approach behaviors

Which of the following is an example of an approach behavior*

*
*
*
*
*

spending money
interacting with employees
browsing
being brand loyal to a service
all of the above

When developing servicescapes, firm's recognize that their physical environment will affect employees and
customers. This is due primarily to:

*
*
*
*
*

inseparability
intangibility
heterogeneity
perishability
none of the above

Which of the following is NOT an example of an ambient condition in a retail environment*

*
*
*
*
*

music
signs
scents
lighting
colors

Ambient conditions will have the least effect on customer behavior in which of the following servicescapes*

*
*
*
*
*

a bakery shop
an air-conditioned hotel on a hot July day
an open five-story parking garage
bookstore with an in-store coffee cart
a movie theater

In a(n) _______ environment, the service employees are physically present while customers are involved in the
service production process at an arms length.

*
*
*
*
*

self-service
vertical service
remote service
saleable service
interpersonal service

A __________ is the customer's composite of mental images of the service firm's physical facilities.

*
*
*
*
*

internal response moderators


perceived servicescape
cognitive response
emotional response
physiological response

Consumers who seek convenience over price and personal attention are:

*
*
*
*
*

economic customers
personalized customers
apathetic customers
ethical customers
elastic customers

Which of the following mediates the reaction between the perceived servicescape and customer's and employee's
responses to the service environment*

*
*
*
*
*

internal response moderators


the holistic environment
individual behaviors
social interactions
physical environmental dimensions

The emotional states of pleasure-displeasure, arousal-nonarousal, and dominance-submissiveness are types of


__________.

*
*
*
*
*

internal response moderators


the holistic environment
individual behaviors
social interactions
physical environmental dimensions

Consumer beliefs, categorization and symbolic meaning are types of:

*
*
*
*
*

physiological customer responses


emotional customer responses
individual approach behaviors
internal response moderators
cognitive customer responses

Consumer moods and attitudes are types of:

*
*
*
*
*

physiological customer responses


emotional customer responses
individual approach behaviors
internal response moderators
cognitive customer responses

Consumer feelings of pain, comfort, and physical fit are types of:

*
*
*
*
*

physiological customer responses


emotional customer responses
individual approach behaviors
internal response moderators
cognitive customer responses

Which of the following senses conveys more information than any of the others*

*
*
*
*
*

sight
sound
scent
touch
taste

The three primary visual stimuli that appeal to consumers on a basic level are:

* harmony, contrast, and clash

*
*
*
*

size, shape, and color


blue, yellow, and green
red, blue, and green
violet, blue, and red

The actual size of the firm's facility conveys meanings to the firm's target market. Which of the following most
accurately describes customer perceptions regarding small facilities*

*
*
*
*
*

important
powerful
personal
successful
stable

Which of the following statements pertaining to colors is false*

*
*
*
*
*

Hues are the actual colors such as red, blue, or yellow.


Warm colors are perceived as aloof or formal.
Children appear to favor brighter colors.
Adults tend to favor softer tones.
Dark colors make large empty spaces look smaller.

Which of the following statements pertaining to the location of the firm is false*

* Location decisions should consider the amount of customer involvement necessary to


provide the service.
* Low contact firms should consider moving sites that are closer to sources of supply,
transportation and labor.
* The actual location of high-contact services should be a close to the street as possible.
* Parking should be considered when making site selection decisions.
* The firm's facility should be compatible with its surrounding environment.
According to results of a study that examined the effects of music on restaurant patrons, which of the following
statements is true*

*
*
*
*
*

consumers spent more money when fast music was played


customers were served faster when slow music was played
customers had higher bar bills when slower music was played
estimated gross margins were higher when fast music was played
customers were willing to wait longer for a table when fast music was played

Which of the following color combinations are all warm colors*

*
*
*
*
*

red, blue, green


yellow, blue, violet
red, yellow, green
yellow, red, orange
orange, blue, green

Which of the following colors is perceived as aloof, icy and formal*

*
*
*
*
*

red
blue
yellow
orange
all of the above

Which of the following statements is not true*

*
*
*
*
*

combinations of warm and cool colors can create relaxing, yet stimulating atmospheres.
lighter hues are popular for fixtures
darker hues are used for attention grabbers
too much violet may dampen consumer spirits
all the above are true

__________ encourage quick decisions and work best for businesses where low-involvement purchase decisions
are made.

*
*
*
*
*

response moderators
scent appeals
warm colors
sound appeals
taste appeals

__________ are favored when the customer needs to take time to make decisions, such as the time needed to
make high-involvement decisions.

*
*
*
*
*

cool colors
scent appeals
warm colors
sound appeals
taste appeals

Chapter 11: People Issues - Managing Service Employees

Test Yourself on MIS


Show questions one by one
The two primary roles that boundary-spanning personnel fulfil are:

*
*
*
*
*

sales and profit-production


sales and customer service
information transfer and representation
process flow and service
information transfer and profit production

Which of the following is a boundary spanner*

*
*
*
*
*

University lecturer
Top Shop customer service representatives
McDonalds order takers
restaurant servers
all of the above

Boundary-spanning personnel typically experience different sources of conflict


while performing their roles. Which of the following is not one of the sources*

*
*
*
*
*

person/role conflict
channel conflict
organization/client conflict
inter-client conflict
all the above are sources of boundary spanning conflict

When a plastic surgeon feels a conflict between what he/she is asked to do and her own orientation or values she
is experiencing ______ conflict.

* person/role conflict
* channel conflict
* organization/client conflict

* inter-client conflict
* horizontal conflict
Initially, bank counter staff were uncomfortable with their new task of selling services to customers. They viewed
themselves as bank counter staff and not salespersons. This is an example of which type of conflict*

*
*
*
*
*

person/role conflict
channel conflict
organization/client conflict
inter-client conflict
all the above are sources of conflict

Employees who feel that they are often caught in the middle between company
rules and regulations and customer requests for services which are against
company rules are experiencing which of the following types of conflict*

*
*
*
*
*

person/role conflict
channel conflict
organization/client conflict
inter-client conflict
all the above are sources of conflict

A Disney Tram driver that is asked to break-up a fight between a feuding


couple who is breaking off their engagement is experiencing which of the
following types of conflict*

*
*
*
*
*

person/role conflict
channel conflict
organization/client conflict
inter-client conflict
all the above are sources of conflict

Employees often attempt to reduce their role stress by engaging in a number


of behaviours. Which of the following is not one of these behaviours*

*
*
*
*
*

ignore the customer


engage in a people-processing mode
use physical symbols in their office to regain some sense of control
overact the role and place the customer in a subservient role
all the above are ways employees attempt to reduce role stress

Employee perceptions of one or more organizational strategic imperative is called ____________.

*
*
*
*
*

empowerment
enfranchisement
service passion
climate
production-lining

__________ gives discretion to front-line personnel to meet the needs of


consumer's creatively.

*
*
*
*
*

empowerment
enfranchisement
service passion
service climate
production-lining

__________ combines with empowerment a compensation method that ties


pay to performance.

*
*
*
*
*

double empowerment
straight salary
enfranchisement
quota systems
straight commission

Which of the following is not a benefit associated with empowerment*

*
*
*
*
*

quicker response to customer needs


quicker response to dissatisfied customers
employees feel better about their jobs and themselves
employees interact with customers with more enthusiasm
all the above are advantages of empowerment

Which of the following is not a benefit associated with empowerment*

*
*
*
*
*

quicker response to customer needs


larger investment is needed in selection and training of personnel
quicker response to dissatisfied customers
employees feel better about their jobs and themselves
employees interact with customers with more enthusiasm

Which of the following is not a cost associated with empowerment*

*
*
*
*
*

higher labour costs


slower or inconsistent service delivery
decreased word-of-mouth advertising
giveaways and bad decisions
some customers think others receive preferential treatment

One of the potential costs in employee empowerment is:

*
*
*
*
*

higher labour costs


slower responses to dissatisfied customers
decreased word-of-mouth advertising
increased employee dissatisfaction
increased customer dissatisfaction

Empowerment approaches fall along a continuum that ranges from controloriented to involvement-oriented. Which of the following empowerment
approaches is the least involvement-oriented*

*
*
*
*
*

job involvement
suggestion involvement
high involvement
enfranchisement
contingency involvement

The empowerment approach that allows employees to use a variety of skills and
teams, but higher level decisions such as reward allocation are left to senior
management to decide is called:

*
*
*
*

job involvement
suggestion involvement
high involvement
production line approach

* contingency involvement
The empowerment approach that trains people to manage themselves is called:

*
*
*
*
*

job involvement
suggestion involvement
high involvement
production-line approach
contingency involvement

Indicate whether the service firm should employ a production line approach or an empowerment approach under
the conditions below:
The technology involved with the business is non-routine and complex.

* production line approach


* empowerment approach
Indicate whether the service firm should employ a production line approach or an empowerment approach under
the conditions below:
The firm produces a low cost, high volume product.

* production line approach


* empowerment approach
Indicate whether the service firm should employ a production line approach or an empowerment approach under
the conditions below:
The business environment is predictable with few surprises

* production line approach


* empowerment approach
Indicate whether the service firm should employ a production line approach or an empowerment approach under
the conditions below:
The business thrives on repeat customers

* production line approach


* empowerment approach
Indicate whether the service firm should employ a production line approach or an empowerment approach under
the conditions below:
The business employees Theory Y managers who believe that employees have high growth needs and strong
interpersonal skills

* production line approach


* empowerment approach
According to the text, marketing and service orientated organisations are embracing market-focused management
approaches. What do market-focused organisation understand:

*
*
*
*
*

consumers always buy more if the employee is satisfied with their pay
there is no relationship between service given and customer satisfaction
there is a relationship between employee turn-over and customer satisfaction
employees who are new to the job are not trained in market-focused organisations
all of the above

Which one of the following facts about the benefits to the customer of service orientated organisations is false*

* they receive better service


* greater customer satisfaction

* better customer/organisation relationship


* lower customer churn
* they receive staff training
Which one of the following is not one of the seven tests of reward effectiveness*

*
*
*
*
*

availability
flexibility
visibility
durability
perishability

Which of the following tests of reward effectiveness reflects the notion that if
rewards are given to the wrong people for the wrong reasons, they should not be lifelong*

*
*
*
*
*

availability
flexibility
visibility
durability
reversibility

Which of the following tests of reward effectiveness reflects the notion that rewards should be given immediately
following desired behaviours*

*
*
*
*
*

availability
flexibility
timeliness
durability
perishability

Which of the following tests of reward effectiveness reflects the notion that rewards should be tied to desired
performance criteria*

*
*
*
*
*

availability
flexibility
timeliness
durability
contingent

Which of the following tests of reward effectiveness reflects the notion that rewards should be large enough for
employees to take notice*

*
*
*
*
*

availability
flexibility
timeliness
durability
contingent

Which of the following tests of reward effectiveness reflects the notion that rewards should be able to be given to
anyone at anytime*

*
*
*
*
*

availability
flexibility
timeliness
durability
perishability

One of the major lessons to learn from the Service-Profit Chain is:

* customer loyalty leads to customer satisfaction

* firms must satisfy their employees in order for customer satisfaction to


become a consistent reality
* employee retention leads to employee satisfaction
* the firm's profitability leads to customer satisfaction
* revenue growth leads to customer satisfaction
Important components of internal service quality include all of the following
except for:

*
*
*
*
*

customer referrals
rewards and recognition
workplace design
job design
selection and development

Customer retention, repeat business, and customer referrals are alternative


measures for:

*
*
*
*
*

internal service quality


external service value
employee satisfaction
customer loyalty
employee productivity

Empowerment coupled with a performance-based compensation method is called _________.

*
*
*
*
*

empowerment
enfranchisement
service passion
climate
production-lining

Chapter 12: People Issues - Managing Service Consumers

Test Yourself on MIS


Show questions one by one
The consumer management areas of particular importance to service marketers are:

*
*
*
*
*

Managing customer participation


Managing customer waits
Managing uncooperative customers
Customer relationship management (CRM)
All of the above

Efforts to transform customers into partial employees should not be interpreted as the firms way of distancing
itself from the customer. This is consistent with which of the following guidelines for increasing customer
participation:

*
*
*
*
*

develop customer trust


promote the benefits and stimulate trial
understand customer habits
pretest new procedures
monitor and evaluate performance

Part of the problem when transforming from full-service to self-service is that businesses tend to forget why
customers might prefer using full-service options in the first place. This is consistent with which of the following
guidelines for increasing customer participation:

* develop customer trust

*
*
*
*

promote the benefits and stimulate trial


understand customer habits
pre-test new procedures
monitor and evaluate performance

Part of the problem when transforming from full-service to self-service is that the new procedures themselves are
flawed and/or difficult to understand. Of the guidelines presented below, which would minimize this type of
problem from occurring* This is consistent with which of the following guidelines for increasing customer
participation:

*
*
*
*
*

develop customer trust


promote the benefits and stimulate trial
understand customer habits
pre-test new procedures
understand the determinants of consumer behavior

When service is produced via a cooperative effort between customers and service providers, this is referred to as:

*
*
*
*
*

co-production
intangibility
heterogeneity
inseparability
perishability

Co-production of services is made possible due to the __________ inherent in the production of services.

*
*
*
*
*

homogeneity
intangibility
heterogeneity
inseparability
perishability

Which of the following is not a typical benefit associated with self-service*

*
*
*
*
*

convenience
cost savings
customization
standardization
all of the above are benefits of self-service

Which of the following was NOT discussed in the text as a guideline for transforming customers into partial
employees*

*
*
*
*
*

develop customer trust


promote the benefits and stimulate trial
understand customer habits
pretest new procedures
develop reward systems for partial employees

Which of the following was NOT discussed in the text as the Cs of customer interface*

*
*
*
*
*

context
commerce
community
consumer
communication

Strategies developed to minimize this "principle of waiting" have led to increased profit opportunities for the firm.

* preprocess waits feel longer than in process waits

*
*
*
*

unoccupied time feels longer than occupied time


unfair waits are longer the equitable waits
anxiety makes the wait seem longer
uncertain waits are longer than known, finite waits

Disney informs guests how long the wait will be along various points of the lines that form for each of its
attractions. This strategy helps minimize the effects of which of the following "principles of waiting*"

*
*
*
*
*

preprocess waits feel longer than in process waits


unoccupied time feels longer than occupied time
unfair waits are longer the equitable waits
the more valuable the service, the longer the customer will wait
uncertain waits are longer than known, finite waits

Fast-food restaurants such as Burger King, and Subway employ a single-line strategy. In comparison, McDonald's
employs a multiple line strategy. The single-line strategy helps minimize the effects of which of the following
"principles of waiting*"

*
*
*
*
*

preprocess waits feel longer than in process waits


unoccupied time feels longer than occupied time
unfair waits are longer the equitable waits
solo waits are longer than group waits
the more valuable the service, the longer the customer will wait

Doctors' offices frequently stage their patients by asking patients to move from the formal waiting area to an
examination room. This strategy helps minimize effects of which of the following "principles of waiting*"

*
*
*
*
*

pre-process waits feel longer than in process waits


solo waits feel longer than group waits
unfair waits are longer the equitable waits
anxiety makes the wait seem longer
uncertain waits are longer than known, finite waits

Which of the following statements is not correct*

*
*
*
*
*

preprocess waits feel longer than in process waits


occupied time feels longer than unoccupied time
unfair waits are longer the equitable waits
anxiety makes the wait seem longer
uncertain waits are longer than known, finite waits

Which of the following "principles of waiting" is stated correctly*

*
*
*
*
*

group waits are longer than solo waits


explained waits are longer than unexplained waits
finite waits are longer than uncertain waits
in-process waits are longer than preprocess waits
all of the above statements are incorrect

_______ waits serve the function of occupying customers time and reduces the perceived wait.

*
*
*
*
*

solo
group
friends
anxiety
customer

The customer that most managers will tell their employees that they don't have to deal with is:

* Egocentric Edgar

*
*
*
*

Freeloading Freda
Hysterical Harold
Bad-Mouth Betty
Dictatorial Dick

New company policies are often developed for the sole purpose of defeating this
customer. These new policies add to the bureaucratization of the organization and penalize the customers who
follow the rules.

*
*
*
*
*

Egocentric Edgar
Freeloading Freda
Hysterical Harold
Bad-Mouth Betty
Dictatorial Dick

This customer from hell complains simply so he/she will receive their merchandise for free.

*
*
*
*
*

Egocentric Edgar
Freeloading Freda
Hysterical Harold
Bad-Mouth Betty
Dictatorial Dick

This customer from hell walks over front-line personnel and believes that Your company exists to serve my
needs and my needs alone.

*
*
*
*
*

Egocentric Edgar
Freeloading Freda
Hysterical Harold
Bad-Mouth Betty
Dictatorial Dick

This customer from hell likes to tell everyone exactly how they are supposed to do their jobs because he has
done it all before.

*
*
*
*
*

Egocentric Edgar
Freeloading Freda
Hysterical Harold
Bad-Mouth Betty
Dictatorial Dick

This customer from hell who reverts to screaming and tantrums to make his or her point.

*
*
*
*
*

Egocentric Edgar
Freeloading Freda
Hysterical Harold
Bad-Mouth Betty
Dictatorial Dick

A method of dealing with a dissatisfied customer by agreeing on minor issues in order to show that the customer is
being heard is called:

*
*
*
*
*

customer relationship management


socialization
empowerment
enfranchisement
selective agreement

___________ is the process of identifying, attracting, differentiating, and retaining customers.

*
*
*
*
*

customer relationship management


socialization
empowerment
enfranchisement
blueprinting

__________ categorizes customers based on their profitability.

*
*
*
*
*

targeting
sharing
processing
coding
routing

__________ directs incoming customer calls based on the customers profitability.

*
*
*
*
*

targeting
sharing
processing
coding
routing

__________ offers the firms most profitable customers special deals and incentives.

*
*
*
*
*

targeting
sharing
processing
coding
routing

__________ makes key customer information accessible to all parts of the organization and in some cases sells
customer information to other firms.

*
*
*
*
*

targeting
sharing
processing
coding
routing

Which of the following is not an outcome of Customer Relationship Management*

*
*
*
*
*

targeting
sharing
processing
coding
routing

Charles Schwab Corps top-rated Signature clients, consisting of customers who maintain $100,000 in assets or
trade at least 12 times a year, never wait more than 15 seconds to have their calls personally answered by a
customer service representative. Regular customers can wait up to 10 minutes or more. This is an example of
which of the following CRM outcomes*

*
*
*
*
*

targeting
sharing
processing
coding
routing

A British airlines passenger was shocked when a ticketing agent told him: Wow, somebody doesnt like you.
Apparently the passenger was involved in an argument with another airline employee several months earlier. The
argument became part of the passengers permanent record that follows him wherever he flies with United. This is
an example of which of the following CRM outcomes*

*
*
*
*
*

targeting
sharing
processing
coding
routing

The increased usage of CRM practices, where high-value customers are treated superior to low-value customers,
can be attributed to several trends except:

*
*
*
*
*

more and more customers are opting for low prices over high quality service
more and more customers are opting for convenience over high quality service
decreasing profit margins are hindering firms from treating all customers equally
markets are increasingly homogeneous
promotional costs are on the rise

Limitations of CRM include all of the following except:

*
*
*
*
*

customers do not like knowing that they are not being treated equally
customers have privacy concerns associated with CRM practices
CRMs focus is only on future purchase patterns
CRM may discriminate against lower economic groups
All of the above are limitations associated with CRM

Chapter 14: Defining and Measuring Customer Satisfaction

Test Yourself on MIS


Show questions one by one
According to the Journal of Advertising Research, the fastest growing area in
market research is:

*
*
*
*
*

employee surveys
customer satisfaction surveys
environmental design
management development programs
service failure and recovery analysis

Which of the following is not one of the reasons that fueled the growth of the 1970's consumerism movement*

*
*
*
*
*

skyrocketing inflation
automation
deregulation
more informed consumers
surplus labor

Which one of the following statements regarding customer satisfaction is correct*

*
*
*
*
*

the average business does not hear from 85 percent of its unhappy customers
for every complaint received, 9 or 10 people actually have the same problem
complainers are more likely to do business with you again than noncomplainers
the average person with a problem tells more than 20 people
customers who have their complaints resolved tell an average of 26 people

Which of the following statements regarding customer satisfaction is incorrect*

* bad news is communicated to more people than good news

* complainers are more likely to do business with you again than noncomplainers
* the average business does not hear from 80 percent of its unhappy customers
* for every complaint received, 26 customers actually have problems
* 95 percent of customers who have their complaints resolved quickly will continue to
conduct business with the firm
The most popular definition of customer satisfaction/dissatisfaction is based on:

*
*
*
*
*

the SERVQUAL Model


the Servuction Model
the Scale of Market Entities
the Expectancy Disconfirmation Model
Technical Assistance Research Program (TARP)

Positive disconfirmation of consumer expectations occurs when:

*
*
*
*
*

expectations meet perceptions


expectations exceed perceptions
expectations are less than perceptions
perceptions are less than expectations
expectations meet or exceed perceptions

Customers are most dissatisfied when a ______________ occurs.

*
*
*
*
*

disconfirmation
zone of intolerance
positive disconfirmation
confirmation
negative disconfirmation

Which of the following is not a benefit of customer satisfaction*

*
*
*
*
*

the firm is more insulated from price competition


the firm provides a positive work environment for its employees
positive word-of-mouth is generated from satisfied customers
satisfied customers make purchases more frequently
all the above

According to the text, of the following customer satisfaction methods, which is the least effective in producing
meaningful results*

*
*
*
*
*

The Scale of 100 Approach


Personal Interviews
The "Very Dissatisfied/Very Satisfied" Approach
The Combined Approach
Employee Surveys

According to the text, of the following customer satisfaction methods, which is


the most effective in producing meaningful results*

*
*
*
*
*

The Scale of 100 Approach


Personal Interviews
The "Very Dissatisfied/Very Satisfied" Approach
The Combined Approach
Employee Surveys

In general, the distribution of most companies customer satisfaction ratings is:

* bimodal

*
*
*
*

normal
negatively skewed
positively skewed
erratic

Which of the following is not an indirect method of measuring customer satisfaction*

*
*
*
*
*

sales records
profit reports
registered complaints
the "Scale of 100 Approach"
all the above are indirect measures

Which of the following tactics would yield higher customer satisfaction scores*

*
*
*
*
*

utilizing mail surveys instead of personal interviews


stating the question in a dissatisfied form instead of a satisfied form
asking general questions prior to specific questions
avoiding data collection until a substantial period of time had elapsed since the purchase
all the above would generate lower customer satisfaction scores

Under which of the following scenarios is it more likely that a firm would invest the resources necessary to
increase its satisfaction ratings from 95 to 98 percent*

*
*
*
*
*

Competing firms have 90 and 88 percent satisfaction ratings


Competing firms have 85 and 75 percent satisfaction ratings
Competing firms have 96 and 97 percent satisfaction ratings
There are many opportunity costs associated with the investment
The market share gained has little effect on the firm's bottom-line profits

The primary contribution of Babich's customer satisfaction models is that it


stresses the importance of knowing __________.

*
*
*
*
*

customer satisfaction ratings


supplier satisfaction ratings
employee satisfaction ratings
competitor satisfaction ratings
stock holder satisfaction ratings

According to one group of consultants, on average, __________ percent of customers who defect to competitors
say they were "satisfied" or "very satisfied" with their former providers.

*
*
*
*
*

5 to 25
15 to 35
25 to 45
45 to 65
65 to 85

__________ is the level of service quality a customer believes is likely to


occur.

*
*
*
*
*

desired service
predicted service
ideal service
adequate service
derived expectations

Customer satisfaction can be defined by comparing:

* predicted service and perceived service

*
*
*
*

predicted service and desired service


desired service and perceived service
adequate service and perceived service
expected service and desired service

Which of the following are service quality measures*

*
*
*
*
*

customer satisfaction
desired service
perceived service superiority
perceived service adequacy
both c and d

_______ service is the level of service the customer actually wants to receive.

*
*
*
*
*

desired service
predicted service
ideal service
adequate service
derived expectations

The zone of tolerance is most directly related to which of the following unique service attributes*

*
*
*
*
*

intangibility
perishability
heterogeneity
inseparability
homogeneity

The zone of tolerance is defined by the difference between:

*
*
*
*
*

predicted service and perceived service


predicted service and desired service
desired service and adequate service
adequate service and perceived service
expected service and desired service

Personal factors that are stable over time and that increase a customer's
sensitivity to how the service should be best provided are referred to as:

*
*
*
*
*

situational factors
explicit service promises
perceived service alternatives
transitory service intensifiers
enduring service intensifiers

Which of the following is not a factor that influences perceived service*

*
*
*
*
*

explicit service promises


perceived service alternatives
past experience
implicit service promises
word-of-mouth communications

Situational factors such as bad weather, catastrophe, and random events of over-demand influence __________
levels.

* desired service
* predicted service

* ideal service
* adequate service
* derived expectations
The number of competing alternative service providers available has the biggest influence on:

*
*
*
*
*

desired service
predicted service
ideal service
adequate service
derived expectations

One of the major factors driving customer expectations of desired service is:

*
*
*
*
*

predicted service
the customer's personal service philosophies
adequate service
transitory service intensifiers
perceived service alternatives

When forming customer expectations, price acts as a:

*
*
*
*
*

enduring service intensifier


transitory service intensifier
explicit service promise
implicit service promise
situational factor

When forming customer expectations, the firm's physical facility acts as a:

*
*
*
*
*

enduring service intensifier


transitory service intensifier
explicit service promise
implicit service promise
situational factor

When forming customer expectations, the firm's brochure acts as a:

*
*
*
*
*

enduring service intensifier


transitory service intensifier
explicit service promise
implicit service promise
situational factor

The higher the number of perceived service alternatives:

*
*
*
*
*

the higher the level of adequate service expectations


the lower the level of adequate service expectations
the more narrow the zone of tolerance
a and c
b and c

Gregs flight on Ryanair from Dublin to Barcelona departed two hours late because of a high winds in Dublin. The
weather that delayed Gregs flight is a:

*
*
*
*

transitory service intensifier


self-perceived service role
predicted service intensifier
situational factor

* personal needs
A bias in survey results because of responses being received from only a limited group among the total survey
population is called:

*
*
*
*
*

response bias
question bias
social desirability bias
collection bias
none of the above

Which of the following is NOT a criticism of customer satisfaction research*

* focuses on whether current needs are being met but fails to investigate customers future
needs
* focus on registered complaints
* focus on global attributes and ignores operational elements
* it often excludes the firms employees from the survey process
* customer know what they want and it is the worst strategy to follow
Naomis children are giving her a week at a spa for her seventieth birthday. The expectations of the services the
spa will provide are much higher because they are selecting the spa for their mothers approval rather than for
their own use. This is an example of a(n) _________ expectation.

*
*
*
*
*

derived service
self-perceived service
explicit service
enduring service
transitory service

Chapter 15: Defining and Measuring Service Quality

Test Yourself on MIS


Show questions one by one
_________ is an attitude formed by a long-term, overall evaluation of a firm's performance.

*
*
*
*
*

Customer satisfaction
Negative disconfirmation
Positive disconfirmation
Service quality
Customer retention

__________ is a short-term, transaction specific measure.

*
*
*
*
*

Customer satisfaction
Focus group interviews
Noncustomer research
Service quality
Customer retention

Which of the following statements is correct*

* customer satisfaction leads to perceived service quality


* service quality leads to customer satisfaction
* service quality leads to increased purchasing behavior
* customer satisfaction leads to increased purchasing behavior
* the relationship between service quality and customer satisfaction and how
these two concepts relate to purchasing behavior remains largely unexplained

The distance between a customers expectations of a service and perception of


the service actually delivered is called:

*
*
*
*
*

service gap
knowledge gap
standards gap
delivery gap
communication gap

The firm's increased research orientation and enhanced upward communication


will assist the firm in decreasing which one of the following gaps*

*
*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap
confirmation gap

Understanding the customer is a critical step toward minimizing or completely


eliminating the:

*
*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap
confirmation gap

A hotel may feel that its customers prefer comfortable rooms, when, in fact,
the majority of the hotel's customers spend little time in their rooms and are
more interested in on-site amenities such as the pool, spa, and restaurants.
This hotel is suffering from a:

*
*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap
confirmation gap

As a service organization's hierarchy becomes more complex and more levels


of management are added, the firm is more likely to experience a:

*
*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap
confirmation gap

The difference between management perceptions of customer expectations and


and standards specifying service to be delivered is called the:

*
*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap
service gap

The firm's overemphasis on cost reduction and short-term profits will increase
the size of the:

*
*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap
confirmation gap

Management's inability to translate what consumers want into a written business


plan will increase the size of the:

*
*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap
confirmation gap

The __________ occurs between the actual performance of a service and the
standards set by management.

*
*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap
service gap

Which of the following is NOT a factor influencing the delivery gap*

*
*
*
*
*

willingness to perform
employee-job fit
role ambiguity
overpromising
inadequate support

Employee willingness to perform and employee-job fit are directly related to


which of the following service quality gaps*

*
*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap
service gap

Minimizing the amount of role conflict and role ambiguity experienced by


employees will help reduce the size of this gap.

*
*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap
confirmation gap

The __________ is the difference between the service the firm promises to
deliver through its external communications and the service it actually delivers
to its customers.

*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap

* service gap
According to the text, when competing firms begin to overpromise in order to
top one another, a __________ is likely to occur.

*
*
*
*
*

knowledge gap
standards gap
delivery gap
communications gap
service gap

Which of the following statements pertaining to the SERVQUAL scale is


correct*

* SERVQUAL compares perceptions to what customers would normally expect


* SERVQUAL is a 22-item scale
* SERVQUAL consists of four service quality dimensions
* SERVQUAL compares perceptions to what a customer should expect from a
firm the delivers high-quality services
* All the above statements are incorrect
Which of the following statements pertaining to the SERVQUAL scale is
incorrect*

* The SERVQUAL dimensions were obtained through extensive focus group interviews
* SERVQUAL is a 44-item scale
* SERVQUAL consists of five service quality dimensions
* SERVQUAL compares perceptions to what a customer should expect from a
firm the delivers high-quality services
* The smaller the gap score for each of the service quality dimensions, the lower the level of
service quality provided
Which of the following is not one the five dimensions that is measured by the
SERVQUAL SCALE*

*
*
*
*
*

tangibles
employee satisfaction
responsiveness
assurance
empathy

The SERVQUAL dimension that measures consumer views of the firm's personnel and communication materials is
the ________ dimension.

*
*
*
*
*

tangibles
employee satisfaction
responsiveness
assurance
reliability

Employees of excellent companies will be neat in appearance is a typical statement within the __________
dimension of the SERVQUAL scale.

*
*
*
*
*

tangibles
reliability
responsiveness
assurance
reliability

The __________ dimension is an assessment of the firm's consistency and


dependability in service performance.

*
*
*
*
*

tangibles
empathy
responsiveness
assurance
reliability

Excellent companies will perform the service right the first time is a typical
statement within the __________ dimension of the SERVQUAL scale.

*
*
*
*
*

tangibles
empathy
responsiveness
assurance
reliability

__________ refers to the service firm's commitment to providing its services


in a timely manner.

*
*
*
*
*

tangibles
empathy
responsiveness
assurance
reliability

The SERVQUAL dimension that measures consumer views that reflect the
security of the firm's operations is the ________ dimension.

*
*
*
*
*

tangibles
employee satisfaction
responsiveness
assurance
reliability

Excellent companies will have the customer's best interest at heart is a typical
statement within the __________ dimension of the SERVQUAL scale.

*
*
*
*
*

tangibles
empathy
responsiveness
assurance
reliability

Which of the following is a major criticism of the SERVQUAL scale*

*
*
*
*
*

short questionnaire
validity of the five service quality dimensions
does not predict consumer purchase intention
contact personnel
none of the above

Research that examines the customers perspective of a firms strengths and weaknesses is called:

*
*
*
*

customer research
employee survey
noncustomer research
customer complaints

* service quality survey


The SERVQUAL dimension that is typically noted as the least important by customers is the __________ dimension.

*
*
*
*
*

tangibles
empathy
responsiveness
assurance
reliability

The SERVQUAL dimension that is typically noted as the most important


by customers is the __________ dimension.

*
*
*
*
*

tangibles
empathy
responsiveness
assurance
reliability

Which of the following is not a component of a service quality information


system*

*
*
*
*
*

mystery shopping
customer retention interviews
after-sale surveys
employee surveys
total market service quality surveys

The component of a firm's service quality information system that is used


specifically to assess employee performance is:

*
*
*
*
*

solicitation of customer complaints


customer focus group interviews
employee surveys
mystery shopping
total market service quality survey

The component of a firm's service quality information system that


assesses the firm's and competitor's service quality ratings is:

*
*
*
*
*

solicitation of customer complaints


customer focus group interviews
employee surveys
mystery shopping
total market service quality survey

Which of the following is NOT a key component that needs to be built into every service quality system*

*
*
*
*
*

listening
reliability
servant leadership
individual play
service design

Chapter 16: Service Failures and Recovery Strategies

Test Yourself on MIS


Show questions one by one
The moments of interaction between the customer and the service firm are called:

* Servuction junction

*
*
*
*

critical incidents
core service failures
service recovery
instrumental complaints

Services that do not meet customer expectations are called:

*
*
*
*
*

service failures
critical incidents
Servuction failures
service recovery
instrumental complaints

Which of the following is not a main service failure category discussed in the text*

*
*
*
*
*

unprompted and unsolicited employee actions


responses to customers implicit needs
pricing failures
core service failures
responses to explicit needs

In general, the service failure category of implicit and explicit customer needs and requests consist of employee
responses to which types of possible failures*

*
*
*
*
*

special needs
customer preferences
disruptive others
customer errors
all of the above

Categorize the following service failures into its appropriate main service failure category:
unavailable or slow service

* responses to core service failure


* responses to needs and requests
* unprompted/unsolicited employee action
Categorize the following service failures into its appropriate main service failure category:
dirty silverware in a restaurant

* responses to core service failure


* responses to needs and requests
* unprompted/unsolicited employee action
Categorize the following service failures into its appropriate main service failure category:
disruptive customers

* responses to core service failure


* responses to needs and requests
* unprompted/unsolicited employee action
Categorize the following service failures into its appropriate main service failure category:
rude service providers

* responses to core service failure


* responses to needs and requests

* unprompted/unsolicited employee action


Categorize the following service failures into its appropriate main service failure category:
10 diners not being able to sit together

* responses to core service failure


* responses to needs and requests
* unprompted/unsolicited employee action
Categorize the following service failures into its appropriate main service failure category:
a Dominos pizza employee who provided a
meal for a family whose house had burnt down

* responses to core service failure


* responses to needs and requests
* unprompted/unsolicited employee action
Categorize the following service failures into its appropriate main service failure category:
a customer who orders a steak medium
rare and receives it well-done

* responses to core service failure


* responses to needs and requests
* unprompted/unsolicited employee action
Categorize the following service failures into its appropriate main service failure category:
an employee who provides magazines for the
children waiting for their parents at the solicitors office

* responses to core service failure


* responses to needs and requests
* unprompted/unsolicited employee action
Categorize the following service failures into its appropriate main service failure category:
an individual with a disability is unable to gain
access to the elevated booth in a restaurant

* responses to core service failure


* responses to needs and requests
* unprompted/unsolicited employee action
Categorize the following service failures into its appropriate main service failure category:
a flight attendant is rude to travellers

* responses to core service failure


* responses to needs and requests
* unprompted/unsolicited employee action
Service failures involving problematic customer include _____.

*
*
*
*
*

uncooperative customers
breaking company policies
drunkenness
verbal and physical abuse
all of the above

Consumer complaints tend to be:

*
*
*
*
*

instrumental and ostensive


instrumental and reflexive
non-instrumental and ostensive
non-instrumental and reflexive
ostensive and reflexive

__________ are complaints that are expressed without the expectation that
the problem will be solved.

*
*
*
*
*

ostensive
instrumental
reflexive
non-instrumental
none of the above

__________ complaints are registered for the expressed purpose of altering


an undesirable state of affairs.

*
*
*
*
*

ostensive
instrumental
reflexive
non-instrumental
none of the above

In general, individuals avoid making this type of complaint so as not to reinforce


negative self-esteem.

*
*
*
*
*

ostensive
instrumental
reflexive
non-instrumental
none of the above

This type of complaint is not usually heard because people seldom want to
convey negative attributes about themselves to others.

*
*
*
*
*

ostensive
instrumental
reflexive
non-instrumental
none of the above

Complaints about the weather being too hot can be classified as:

*
*
*
*
*

instrumental and ostensive


instrumental and reflexive
non-instrumental and ostensive
non-instrumental and reflexive
ostensive and reflexive

The smallest number of complaints registered by individuals are:

*
*
*
*
*

instrumental and ostensive


instrumental and reflexive
non-instrumental and ostensive
non-instrumental and reflexive
ostensive and reflexive

Which of the following is not a reason customers complain*

*
*
*
*
*

emotional release from frustration


to regain some control by spreading negative word-of-mouth
to solicit sympathy
to create the impression of being more intelligent
all the above are reasons customers complain

Which of the following is not a reason customers complain*

* emotional release from frustration


* to regain some control by spreading negative word-of-mouth
* to solicit sympathy
* to create the impression of being more intelligent
* service customers tend to feel comfortable about evaluating services and are not afraid to
voice their opinions
Why dont service customers typically complain*

*
*
*
*
*

they don't think it will do any good


they accept part of the blame since they are directly involved in the process
they don't know who to complain to
they don't want to create a confrontation
all the above are reasons customers do not complain

All of the following are reasons customers do not complain except for:

*
*
*
*
*

complaining provides an emotional release from frustration


they accept part of the blame since they are directly involved in the process
they don't know who to complain to
they don't want to create a confrontation
they feel they lack the expertise to make an objective observation

A firm's reaction to a customer complaint that results in customer satisfaction


and goodwill is called a:

*
*
*
*
*

service recovery paradox


service recovery
critical incident
moment of truth
the critical incident technique

A complaining outcome in which the consumer takes action deliberately designed to damage the physical
operation or hurt future business is called*

*
*
*
*
*

voice
retaliation
service recovery
exit
service recovery paradox

__________ refers to the situation in which the customer rates performance


higher if a failure occurs and the contact personnel successfully recover from
it than if the service had been delivered correctly the first time.

*
*
*
*

service recovery paradox


service recovery
critical incident
moment of truth

* the critical incident technique


Perceived justice consists of three components:

*
*
*
*
*

social, distributive, and ethical justices


procedural, psychological, and social justices
social, interactional, and physical justices
distributive, interactional, and procedural justices
social, ethical, and physcial justices

The component of perceived justice that refers to the outcomes associated with the service recovery process is
referred to as __________ justice.

*
*
*
*
*

social
procedural
interactional
distributive
ethical

During a service recovery effort, the employee promptly refunded the customers money, but threw the money at
the customer. As a result, the recovery effort violated the customers ___________ justice need.

*
*
*
*
*

social
procedural
interactional
distributive
ethical

During a service recovery effort, the employee was very empathetic to the customers plight and agreed to replace
the defective product. However, it took three months for the replacement product to show up which was much
later than the customer had anticipated. As a result, the recovery effort violated the customers ___________
justice need.

*
*
*
*
*

social
procedural
interactional
distributive
ethical

__________ refers to a method of studying service failures by analyzing


the stories told by customers.

*
*
*
*
*

Service recovery paradox


Service recovery
Critical incident
Procedural inquiry
The critical incident technique

Service firms that wish to excel at service failures analysis and recovery may conduct a _______.

*
*
*
*
*

service recovery audit


service recovery
critical incident
moment of truth
recovery strategies

Chapter 17: Putting The Pieces Together: Creating the Seamless Service Firm

Test Yourself on MIS


Show questions one by one

Service firms often find themselves in a three-cornered fight between:

*
*
*
*
*

engineering, production, and accounting


marketing, finance, and human resources
operations, accounting, and marketing
human resources, marketing and operations
production, finance, and accounting

Services that occur without interruption, confusion, or hassle to the customer is called:

*
*
*
*
*

seamless service
service audit
functional service
departmental service
services marketing

__________ is a firm's view toward planning its operations according to market


needs.

*
*
*
*
*

Marketing orientation
Marketing functions
Marketing department
Marketing forecast
Marketing tasks

__________ refers to tasks such as the design of the product, its pricing, its packaging, and its promotion.

*
*
*
*
*

Marketing orientation
Marketing functions
Marketing department
Marketing forecast
Marketing tasks

The department within the firm that traditionally acts as an advocate for the
consumer is:

*
*
*
*
*

finance
marketing
accounting
information systems
management

The variety of relationships between marketing and other functions within the organization can be illustrated by:

*
*
*
*
*

operations management
customer needs
customer expectations
customer competencies
customization / customer contact matrix

The three tiers that make-up the Three-Tiered Services Model are:

*
*
*
*
*

marketing, operations, and human resource tiers


the customer, the boundary, and coordination tiers
the invisible organization, contact personnel, other customers tiers
the inanimate environment, the customer, and other customer tiers
the invisible organization, the inanimate environment, and contact personnel tiers

Within the Customer Tier, experts believe that businesses now have a fairly good understanding of __________.

*
*
*
*
*

operations management
customer needs
customer expectations
customer competencies
marketing

Security, esteem, and justice are types of __________ that are often
unrecognized by customer's themselves.

*
*
*
*
*

customer perceptions
customer needs
customer expectations
customer competencies
customer attributes

Customer competencies can be described as:

* consumer expectations pertaining to the service delivery process and final


outcome
* customer perceptions regarding the quality of the outcome
* customer abilities that enable them to properly evaluate the servicescape
* the ability to interact effectively with other customers
* the contributions customers bring to the service production process
The location of the "human resource trap" that makes the mistake of placing the
full burden of "moments of truth" upon contact personnel is within:

*
*
*
*
*

the customer tier


the customization/customer contact matrix
the boundary tier
the Servuction model
the coordination tier

Recruitment, selection, training, and socialization are important steps within:

*
*
*
*
*

the customer tier


the customization/customer contact matrix
the boundary tier
the Servuction model
the coordination tier

The tier that it ultimately responsible for developing a service logic that runs
throughout the firm is:

*
*
*
*
*

the customer tier


the contact tier
the boundary tier
the front-line tier
the coordination tier

__________ stresses cost containment and cost reduction through mass


production

*
*
*
*

Marketing logic
Finance logic
Accounting logic
Operations logic

* Human resources logic


Each department within an organization is driven by its own internal logic.
Which of the following statements most accurately reflects operations logic*

* cost reduction can be obtained through mass production


* "families" of personnel should reinforce one another on the job
* personnel should be able to break organization rules in the context of serving the customer
* customers should be provided with options that enable them to meet their
individual needs
* recruiting and training are essential in developing existing personnel
__________ stresses providing customers with options that better enable the
service offering to meet individual customer needs.

*
*
*
*
*

Marketing logic
Finance logic
Accounting logic
Operations logic
Human resources logic

Each department within an organization is driven by its own internal logic.


Which of the following statements most accurately reflects a marketing logic*

* cost reduction can be obtained through mass production


* "families" of personnel should reinforce one another on the job
* personnel should be able to break organization rules in the context of serving the customer
* customers should be provided with options that enable them to meet their
individual needs
* recruiting and training are essential in developing existing personnel
__________ stresses recruiting quality personnel and developing training
programs that enhance the performance of existing personnel.

*
*
*
*
*

Marketing logic
Finance logic
Accounting logic
Operations logic
Human resources logic

Each department within an organization is driven by it' own internal logic.


Which of the following statements most accurately reflects human resources logic*

* cost reduction can be obtained through mass production


* families of customers should reinforce one another throughout the service encounter
* personnel should be able to break organization rules in the context of serving the customer
* customers should be provided with options that enable them to meet their
individual needs
* recruiting and training are essential in developing existing personnel
The use of interfunctional task forces and interfunctional transfers are an attempt
to change the organization's culture through:

*
*
*
*
*

systems
structure
people
rewards
culture-change initiatives

Typical approaches to changing the organizational culture by changing the


structure of the organization include:

*
*
*
*
*

"putting the customer first"


changing the orientation
interfunctional task forces and transfers
bring in outsiders to change the culture
revamping the firm's reward systems

In the effort to create a more customer-focused organization, one of the approaches to changing the culture
through structure is:

*
*
*
*
*

utilizing marketing department as a change agent


changing the orientation
restructuring the firm around the servuction system model
bring in outsiders to change the culture
revamping the firm's reward systems

Revamping the firm's evaluation and promotion procedures are attempts


to change the organization's culture through:

*
*
*
*
*

systems
structure
people
rewards
culture-change initiatives

If XYZ company hires a new manager from outside the firm as opposed to
promoting someone from within, the company may be attempting to change
the culture of the organization through:

*
*
*
*
*

systems
structure
people
rewards
culture-change initiatives

Programs such as "putting the customer first" and "change the way you
work" are attempts to change the organization's culture through:

*
*
*
*
*

systems
structure
people
culture change initiatives
mergers

The culture change program that teaches personnel that essentially "the
customer is king" is called:

*
*
*
*
*

"change the way we work"


"orientation change"
'change the way you work"
"customers are your customers"
"putting the customer first"

The culture change program that teaches "families" of personnel to reinforce


one another on the job is called:

* "change the way we work"

*
*
*
*

"orientation change"
'change the way you work"
"customers are your customers"
"putting the customer first"

The culture change program that allows personnel to break the rules in the
context of serving their customers is called:

*
*
*
*
*

"change the way we work"


"orientation change"
"change the way you work"
"customers are your customers"
"putting the customer first"

The culture change program that teaches personnel to flowchart their activities
and to re-engineer the process to better serve their customers is called:

*
*
*
*
*

"change the way we work"


"orientation change"
"change the way you work"
"customers are your customers"
"putting the customer first"

The cultural change initiative, "change the way we work" is most directly related to:

*
*
*
*
*

empowerment
enfranchisement
re-engineering
recruitment
training

The series of questions that force the firm to think about what drives its profits
is called:

*
*
*
*
*

blueprinting
flowcharting
process flows
service audit
service-profit chain

Which one of the following service audit questions does not belong within the
profit and growth component*

* How does the firm define customer loyalty*


* Does the firm set employee retention goals*
* Does the firm measure profits from referrals*
* What proportion of funds are spent on customer retention as opposed to
attracting new customers*
* When customers do not return, do we know why*
Which of the following is not a major component of the service audit*

*
*
*
*
*

profit and growth audit


employee productivity audit
customer satisfaction audit
Servuction system audit
leadership audit

Which of the following service audit question does belong within the employee productivity component*

*
*
*
*
*

How does the firm define customer loyalty*


Does the firm set employee retention goals*
Does the firm measure profits from referrals*
How does the firm measure employee productivity*
When customers do not return, do we know why*

Which of the following service audit question does not belong within the external service value component*

* How does the firm measure value*


* How is information on customer perceptions of the firms value shared within the
company*
* Does the firm actively measure the gap between customer expectations and perceptions of
service delivered*
* Is service recovery an active strategy discussed among management and employees*
* Are employee aware of internal and external customers*