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OTE Exam with Questions and Answers Frei and Morriss state that the concepts in their book Uncommon Service are "rooted in principles." However, they go on to say that" is where we find some of the largest obstacles to excellence." a) Marketing; operations management b) Human resource; the environment ¢) Psychological; communication d) Engineering: psychology e) Mathematical; talent (or lack thereof) ANSWERV ¥ d) Engineering; psychology Frei and Morris state that "psychology is where we find some of the largest obstacles to [service] excellence." As the authors go on to clarify what they mean by this statement, they explain that a) service jobs pay poorly; therefore, they tend to be occupied by desperate employees who are resentful about their financial circumstances. Ofien, this attitude shows in the way the employees treat customers. b) service providers tend to be paranoid—they believe that if they are too helpful, customers will routinely try to take unfair advantage of them. ¢) it is against human nature to want to serve others. d) even though we often speak of a "win/win mentality" in business, it is natural to want to win at the expense of others. c) those who design and manage service processes deny reality and resist necessary trade- offs. ANSWERV ¥ e) those who design and manage service proc! deny reality and resist necessary trade-offs. According to Frei and Morriss,"... doesn't just tell you what to do; it shows you how to think.” a) training b) a service manifesto c) management d) new-employee orientation e) culture ANSWERV ¥ e) culture Frei and Morriss state: "Leadership, at its core, is about making —and making sure that a) other people better as a result of your presence; the impact lasts in your absence b) more profit with less investment; operating costs are kept to a minimum ¢) your company run faster and harder than your competitors; every employee is a superstar d) the company excellent at everything that it does; excellent service does not cost customers any more than mediocre service e) employees think like you do; they respond appropriately to your charm and charisma ANSWERYV ¥ a) other people better as a result of your presence; the impact lasts in your absence When Frei and Morriss spell out the serviec-excellence equation (Service Excellence = Design x Culture), by "design" they mean design of a) the uniforms worn by the employees b) the company logo c) the blueprint of the business model d) the tangible elements in the service experience e) the organization chart ANSWERV V c) the blueprint of the business model Frei and Morriss state that "the number one obstacle to great service—number one by a long shot—is Frei and Morriss use the label " "to describe a meaningful advantage that your company has over competitors. a) hammer b) salience c) wedge d) anchor e) hook ANSWERV Vv c) wedge Frei and Morriss state that "the primary obstacle to service excellence is not the ambition to be great, but the a) will to be greatest b) failure to benchmark performance c) absence of actionable strategy d) stomach to be bad. e) proliferation of mediocre employees ANSWERV ¥ d) stomach to be bad Frei and Morriss explain four ways that service companies can recover the cost of providing great service. Which of these do they say is the most reliable? a) Funding source 2 (reduce costs in ways that also improve service) and funding source 3 (improve service in ways that also reduce costs) b) Funding source 2: Reduce costs in ways that also improve service c) Funding source 3: Improve service in ways that also reduce costs d) Funding source 4: Get customers to enjoy doing some of the work for you e) Funding source |: Get customers to pay you extra for it ANSWERV ¥ a) Funding source 2 (reduce costs in ways that also improve service) and funding source 3 (improve service in ways that also reduce costs) Frei and Morriss explain four ways that service companies can recover the cost of providing great service. Which of these do they say is the simplest, from a design perspective? a) Funding source 1: Get customers to pay you extra for it b) Funding source 3: Improve service in ways that also reduce costs c) Funding source 2 (reduce costs in ways that also improve service) and funding source 3 (improve service in ways that also reduce costs) d) Funding source 4: Get customers to enjoy doing some of the work for you ¢) Funding source 2: Reduce costs in ways that also improve service ANSWERV V a) Tunding source 1: Get customers to pay you extra for it Frei and Morriss explain four ways that service companies can recover the cost of providing great service. Which of these do they say gets the most attention? a) Funding source 1: Get customers to pay you extra for it b) Funding source 3: Improve service in ways that also reduce costs c) Funding source 2 (reduce costs in ways that also improve service) and funding source 3 (improve service in ways that also reduce costs) d) Funding source 4: Get customers to enjoy doing some of the work for you e) Funding source 2: Reduce costs in ways that also improve service ANSWERV ¥ d) Funding source 4: Get customers to enjoy doing some of the work for you Which of the following statements is not consistent with information presented by Hoffman and Bateson? a) Price is one of the least researched and mastered areas of marketing. b) Just like the price of a tangible good, the price of a service should be determined by the cost of production. c) Of all the marketing mix variables (1.e., product, distribution, price, promotion), price has the most direct effect on profitability. At Visions Day Spa, a client can purchase a "Day at the Spa" for $165. Included are a haircut, manicure, pedicure, and 60-minute massage. With its "Day at the Spa" service offering, Visions is engaging in a) product-line pricing. b) price fixing. ¢) price bundling. d) price skimming. ¢) service stockpiling. ANSWERV ¥ ce) price bundling. With regard to pricing strategy in the service sector, which of the following statements is not consistent with information presented by Hoffman and Bateson? a) When the price of a tangible good is temporarily discounted, consumers will often buy large quantities and store the extras for future use. a) A discounted service price, on the other hand, tends not to result in such "stockpiling" by consumers. b) Compared to purchasers of tangible goods, service customers are less likely to use price to determine quality. c) In the service sector, "price" may be called any of several different names, such as "fare," "rate," or "fee." d) For the consumer, it is more difficult to comparing the prices of competing services than it is to compare prices of tangible goods. e) A consumer who doesn't like the price of a tangible good often cannot make the product instead of buying il. A consumer who doesn't like the price of a serv ANSWERV ¥ b) Compared to purchasers of tangible goods, service customers are less likely to use price to determine quality. Authors Hoffman and Batcson usc Southwest Airlines’ Bags Fly Free™ promotion as an example of a) product-line pricing. b) relationship pricing. c) bundle pricing. d) efficiency pricing. ¢) price discrimination. ANS WERY V d) efficiency pricing. The authors of your textbook describe as "the practice of marketing two or more services in a single package at a single price." a) benefit-driven pricing b) efficiency pricing ¢) flat-rate pricing d) price bundling ¢) cost-leader pricing ANSWERV ¥ d) price bundling Demand is said to be ifa change in price results in a significant change in demand. This effect is generally of magnitude for services than for tangible goods. a) elastic; lesser b) inelastic; lesser c) iconoclastic; lesser d) inelastic; greater e) elastic; greater ANS WERV ¥ a) elastic: lesser With regard to price sensitivity, which of the following statements is consistent with information presented by Hoffman and Bateson? a) As switching costs for a particular service increase, consumers’ price sensitivity toward that service will tend to decrease. d) When companies pay customers (through discounts) to remain customers, that's not a loyalty program. It's a customer retention program. ANSWERV ¥ c) The frequent-flyer program of a typical airline (e.g., Delta, American, United) is an excellent example of a "true loyalty program." In the book Uncommon Service: How to Win by Putting Customers at the Core of Your Business, authors Frei and Morriss introduce The Four Service Truths: 1) You can't be good at everything, 2) , 3) It's not your employees’ fault, and 4) You must manage your customers. a) Social media marketing is overrated b) Traditional target marketing docsn't work anymore c) Beware of "easy" venture capital d) Someone has to pay for it e) If at all possible, buy a franchise ANSWERV ¥ d) Someone has to pay for it Frei and Morriss present four alternative sources of funds to cover the cost of providing great service. One of these is "Charge customers extra for it—in a palatable way." What does the word palatable mean, exactly? a) "Pulsing," meaning charge extra for a period of time, then remove the extra charge for an equivalent period of time, then return to charging extra for that same length of time, then, remove the charge, and so on b) "Universal," meaning charge every customer, regardless of which ones use the great feature(s) of the service and which ones do not c) "Sneaky," meaning do everything you can to hide the fact that you're charging more d) "Tasteful," meaning acceptable or satisfactory c) "Huge," meaning charge as much as you can, hopefully much more than it costs you to provide the great service feature(s) ANS WERV ¥ d) "Tasteful." meaning acceptable or satisfactory Which of the following companies do Frei and Morriss present as an example of funding great service by reducing the company's cost of providing it? a) Starbucks b) Spirit Air c) Piggly Wiggly d) Progressive e) Commerce Bank ANSWERV V d) Progressive With regard to the "communications mix," with which of the following would Hoffman and Bateson likely agree? a. The communications mix consists of five categories of tools: personal selling, advertising, publicity, sales promotion, and sponsorships. b. Advertising is the only communication tool that enables two-way communication. c. Of the available communication tools, personal selling is the fastest in creating overall awareness. d. Using more than one communications tool to communicate the same message is known as "cannibalism." e. All of the above. ANSWERY ¥ a. The communications mix consists of five categories of tools: personal selling, advertising, publicity, sales promotion, and sponsorships. As a communication tool, sponsorships a. provide a way of reaching consumers who skip through commercials. b. allow the service firm to target narrow, but highly desirable target audiences. c. are the best device for stimulating short-term sales. d. do all of the above. e. do A and B only. ANSWERV ¥ e. do A and B only. The authors of your text present an easy-to-remember acronym to help you learn the characteristics of well-conceived communication objectives: SMART. Which of the following characteristics of an objective is part of this acronym? a) The "S" stands for "specific." b) The "M" stands for "marginal." c) The "A" stands for "authentic." d) The "R" stands for "reflective." ¢) The "T" stands for "tangible." ANSWERV v a) The "S" stands for "specific." The authors of your text present an easy-to-remember acronym to help you learn the characteristics of well-conceived communication objectives: SMART. Which of the following characteristics of an objective is part of this acronym? a) The "S" stands for "stochastic." b) The "M" stands for "mature." c) The "A" stands for "annualized." d) The "R" stands for "rational." e) The "T" stands for "time bound." ANSWERV ¥ e) The "T" stands for "time bound." The authors of your text present an easy-to-remember acronym to help you learn the characteristics of well-conceived communication objectives: SMART. Which of the following characteristics of an objective is part of this acronym? a) The "S" stands for "speculative." b) The "M" stands for "marginal." c) The "A" stands for "affirmative." d) The "R" stands for "relevant." e) The "I" stands for "tactical." ANSWERV ¥ d) The "R" stands for "relevant." The authors of your text present an easy-to-remember acronym to help you learn the characteristics of well-conceived communication objectives: SMART. Which of the following characteristics of an objective is part of this acronym? a) The "S" stands for "sovereign." b) The "M" stands for "milestone." ¢) The "A stands for "achievable." d) The "R" stands for "renewable." ¢) The "T" stands for "top down." ANSWERY ¥ ¢) The "A stands for "achievable." During the introduction stage of a service offering's product life cycle, the service firm's communication objective is to a. create a positive attitude toward the service offering, relative to competitive offerings. b. provoke an immediate purchase action. c. introduce the service offering and create brand awareness. d. influence existing customers to purchase again. e. minimize clients! cognitive dissonance over past purchases. ANS WERV v c. introduce the service offering and create brand awareness. Dale Hale has owned a small-engine repair shop for four years. Dale's wife, Gail, maintains the shop's financial records and pays the bills. Two full-time mechanics work for Dale. In his role as owner and general manager, Dale makes all decisions regarding the shop's marketing communications. Periodically, Dale will ask Gail how much "unspoken for" money is in the company checking account, and—if the amount is more than a couple hundred dollars—he'll decide how much of it he can spend on advertising and other marketing communications while still maintaining a cushion for minor emergencies. Hoffman and Bateson would say that Dale's method of budgeting for marketing communications is an example of a. the pereentage-of-sales technique. b. the all-you-can-afford approach. Allstate's "Mayhem Man" and the Travelers Insurance mutt (his name is "Chopper") both represent service advertisers’ attempts to a. "feature the working relationship between customer and provider." b. "determine and focus on relevant service quality dimensions." c. "develop a word-of-mouth communications network." d. "balance service providers’ sclling and operating roles." e. "tangibilize the intangible." ANSWERV V e. "tangibilize the intangible. Which of the following is one of the "three broad categories" of physical evidence that Toffman and Bateson describe? a) Proximity to competitors b) Interstate highway access c) Facility exterior d) Regional demographics e) Headquarters location ANSWERV ¥ c) Facility exterior Physical evidence serves all of the following purposes except: a. packaging the service. b. facilitating the flow of the service delivery process. c. differentiating the firm from its competitors. d. showcasing the good, the bad, and the ugly of the technical core. e. socializing customers and employees in terms of their roles, behaviors, and relationships. ANSWERV ¥ 4d. showcasing the good, the bad, and the ugly of the technical core. With regard to a service firm's physical evidence, which of the following would Hoffman and Bateson most likely not categorize as "other tangibles"? a. The company’s reputation in the community b. The company's billboard advertisement beside a major highway c. The invoices that the company sends to its clients d. The company's business cards e. Employees uniforms ANS WERV V a. The company’s reputation in the community The science of using physical evidence to create service environments—and its influence on the perceptions and behaviors of individuals—is called a. consumer neuropathy. b. buy-o-genics. ¢. servitecture, d. servometrics. e. environmental psychology. ANSWERV V e. environmental psychology. The three components of the SOR model are a. sales, optimization, and revenue. b. satisfaction, obfuscation, and remorse. c. service, observation, and review. d. shopping, obtaining, and remitting. e. stimulus, organism, and response. ANS WERV ¥ e. stimulus, organism, and response. With regard to the "continuum of facility use" (Figure 8.4), which of the following would Hoffman and Bateson not classify as an "interpersonal servic a. Southwest Airlines With regard to developing a servicescape with the target market in mind, with which of the following would Hoffman and Bateson likely agree? a) "Ethical customers" make purchase decisions based primarily on price, and tend to be altracted to simple environments that reflcet quality. b) "Personalized customers" will avoid service establishments that appear fancy or claborate. c) "Economic customers" tend to be attracted to service facilities that are clean and modern. d) "Apathetic customers" want to be pampered and attended to, and are less price sensitive than other customer groups. e) "Personalized customers" tend to support smaller or local service providers as opposed to larger or national. ANS WERV ¥ c) "Economie customers" tend to be attracted to service facilities that are clean and modern. Shannon Bohannon and her friend are visiting Chipotle Mexican Grill for the first time. While the "assembly line" service employees are making her burrito in accordance with her instructions, Shannon says to her friend: "This place is a lot like Qdoba." Hoffman and Bateson would refer to Shannon's cognitive response as a, "categorization." b. a "belief." c, an "avoidance behavior.” d. an "inference of symbolic meaning.” ¢. a "physiological response." ANS WERV V a. "categorization." Which of the following is a product? a) An account at the UK Federal Credit Union b) A GEICO automobile insurance policy c) The 10:00 show of The Post at Cinemark d) All of the above ) None of the above ANSWERV ¥ d) All of the above With regard to the intangibility of services, which of the following statements in consistent with the statements of the authors of your textbook? a) Because of their intangibility. Services cannot be stored in inventory b) The intangibility of services makes it difficult to display them for customers to see c) Unlike tangible goods, services cannot be patented d) All of the above e) None of the above ANSWERV ¥V d) All of the above The authors of your text list and explain several characteristics of services that can sometimes make it easy for service providers to get away with unethical behavior. Which of the following is one of these? a) In some cases, consumers are unable to evaluate a service until long after it has been performed b) Guarantees and warranties on services may be meaningless, nonexistent, or unenforceable c) With some services types, a certain amount of variability is expected d) All of the above c) A & B only - Not this ANSWERV V Not E The performance of services tends to be less uniform than goods. That is, one service provider may perform the service with a different level of expertise or precision than another service provider. Precision of performance may also vary for the same service provider depending on the time of day, the day of the week, the mood of the provider, or a number of other human factors. This illustrates the of services. a) heterogeneity