Chapter 3

Question 1

Collaborative advantage

Answer 1

Demonstrating special skills in managing relationships with key customers or by jointly developing innovative strategies with alliance partners.

Question 2

Relationship marketing

Answer 2

Focuses on all activities directed toward establishing, developing, and maintaining successful exchanges with customers and other constituents.

Question 3

Transactional exchange

Answer 3

Focuses on the timely exchange of basic products for highly competitive market prices.

Question 4

Operational linkage

Answer 4

reflects how much the system, procedures and routines of the buying and selling firms have been connected to facilitate operations. These relationships connectors are a feature of a collaborative relationship.

Question 5

Collaborative exchange

Answer 5

: A process where a customer and supplier firm form strong and extensive social, economic, service, and technical ties over time, with the intent of lowering total costs and increasing value, thereby achieving mutual benefit.

Question 6

Relationship commitment

Answer 6

involves a partner’s belief that an ongoing relationship is so important that it deserves maximum effort to maintain it.

Question 7

Trust

Answer 7

is a firm’s belief that exists when one party has confidence in a partners relaiability and integrity.

Question 8

Transactional relationshsip

Answer 8

is a type of buyer-seller relationshsip that centers on the timely exchange of basic products for highly competitive market products.

Question 9

Collaborative relationship

Answer 9

is a type of relationship that features very close information, social, and operational linkages as well as mutual commitments made in expectation of long-run benefits.

Question 10

Switching costs

Answer 10

is the negative costs incurred by a customer as a result of changing suppliers, brands, or products. Organizational buyers consider two switching costs: investments and risk of exposure. First, organizational buyers invest in the relationships with suppliers in many ways. Because of these past investments, buyers may hesitate to incur the disruptions and switching costs that result when they select new suppliers.

Question 11

Activity-based costing

Answer 11

Illuminates exactly what activities are associated with serving a particular customer and how these activities are linked to revenues and the consumption of resources.

Question 12

Cost of serving the customer

Answer 12

includes order-related costs plus the customer-specific marketing, technical, and administrative expenses.

Question 13

Customer relationship management(CRM

Answer 13

Is a cross-functional process for achieving continuing dialogue with customers across all their contact and access points, with personalized treatment of the most valuable customers to ensure customer retention and the effectiveness of marketing initiatives.

Question 14

Value

Answer 14

is the economic, technical, services, ideas, and social benefits received by a customer firm in exchange for the price paid for a product offering.

Question 15

Value proposition

Answer 15

represents the product, services, ideas, and solutions that a business marketer offers to advance the performance goals of the customer organization.

Question 16

Relationship marketing activities

Answer 16

represents dedicated relationship marketing programs, developed and implemented to build strong relational bonds. These activities influence three important drivers of relationship marketing effectiveness – relationship equality, breadth, and composition – each capturing a different dimension of the relationship and exerting a positive influence on the seller’s performance activity

Question 17

Social RM programs

Answer 17

Use social engagements or frequent customized communication to personalize the relationship and highlight the customer’s special status.

Question 18

Structural RM programs

Answer 18

Designed to increase productivity and efficiency for customers through targeted investments that customers would not likely make themselves.

Question 19

Financial RM programs

Answer 19

Provide economic benefits, such as special discounts, free shipping, or extended payment terms, to increase customer loyalty. Because competitors can readily match the economic incentives, the advantages tend to be unsustainable.

Question 20

Relationship orientation(RO)

Answer 20

Represents the customer’s desire to engage in strong relationships with a current or potential supplier.