1.19) Which of the following statements about the pricing of services (compared to the pricing of
goods) is false?
A) The demand for services tends to be more elastic than the demand for goods
B) Cost-oriented pricing is more difficult for services
C) Comparing prices of competitors is more difficult for service consumers.
D) Self-service is a viable competitive alternative.
E) None of these
1.20) Word-of-Mouth communication networks are particularly important for service firms because
A) Service customers tend to rely more on personal than non-personal source of information.
B) Service firms do not believe in promotional efforts.
C) Service firms can seldom afford to pay for promotional expenditures.
D) Service customers tend to rely more on non-personal than personal sources of information.
E) None of these
Question Two
True or False Questions
Use the table provided on [page 8] to answer these questions, detach and insert it into your answer
booklet. 1 mark will be awarded for each correct answer.
[20 x 1 = 20 Marks]
2.1) Complainers about your service are more likely to do business with you again than non-
complainers.
2.2) CRM is limited by its focus on past purchase patterns.
2.3) Most economies are dominated by the service sector
2.4) With pure tangible goods, the offer consists primarily of a tangible good such as books, shoes -
however, prominent services accompany this offer.
2.5) Due to the fact that employees are already part of the service delivery process, internal marketing
is a less vital aspect of services marketing.
2.6) An external marketing program flows out of a service culture. A service marketing program is
doomed to failure if its organizational culture does not support serving the customer
2.7) If management expects employee's attitudes to be positive toward the customer, management
must have a positive attitude toward the customer and the employees
2.8) A Service Culture is a culture that supports customer service through policies, procedures, reward
system and actions.
2.9) A service culture requires turning the organisational structure upside down.
2.10) Service organisations need to "hire for skills and train for attitude". .
2.11) In services organisations, more emphasis is placed on personality, energy and attitude when
recruiting selecting and training prospective/current employees.
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