Question 1

"Analytical CRM" primarily focuses on:

Direct interaction with customers via call centers.Managing the sales force automation.Mining customer data to identify patterns, profitability, and propensity to buy, aiding strategic decisions.Handling customer complaints.

View Explanation

Operational CRM handles front-end interaction. Analytical CRM works in the background to analyze data for segmentation and targeted marketing.

Question 2

Which technology is essential for effective CRM to store and analyze vast amounts of historical customer data?

FirewallRouterATM SwitchData Warehouse

View Explanation

A Data Warehouse integrates data from various sources (loans, deposits, cards) to provide a unified view of the customer, which is the foundation of Analytical CRM.

Question 3

What is "Wallet Share" in CRM?

The amount of cash in a customer's wallet.The percentage of a customer's total financial business (deposits/loans) that is with a specific bank.The discount given to customers.The share of the bank in the stock market.

View Explanation

CRM aims to increase Wallet Share. If a customer has ?100 savings and keeps ?80 with Bank A, Bank A has an 80% wallet share.

Question 4

The first stage in implementing a CRM strategy is usually:

Implementing Software.Data Collection and Cleansing.Designing Campaigns.Training Staff.

View Explanation

Before any analysis or software can work, the bank must ensure it has accurate, consolidated customer data. Garbage In, Garbage Out applies.

Question 5

Which component of CRM is responsible for "Churn Prediction" (predicting which customer is likely to leave the bank)?

Sales Force AutomationCollaborative CRMOperational CRMAnalytical CRM

View Explanation

Analytical CRM uses data mining and predictive modeling on historical data to identify patterns indicating dissatisfaction or intention to leave (Churn), allowing the bank to take preemptive retention measures.

Question 6

Ethical Cross-Selling requires that:

The product offered is suitable for the customer's profile and needs ("Right to Suitability").The bank sells the product with the highest commission.The bank bundles products without customer knowledge.The bank forces the customer to buy insurance with a loan.

View Explanation

Unethical cross-selling (misselling) erodes trust. Ethical selling focuses on fulfilling a genuine customer need, not just meeting a sales target.

Question 7

Which CRM strategy involves identifying the "Most Valuable Customers" (MVCs) and offering them exclusive benefits to ensure retention?

Mass MarketingWin-back StrategyCustomer Selectivity / Tiered ServiceAcquisition Strategy

View Explanation

Since not all customers are equally profitable, banks use tiered service levels (Gold, Platinum, Priority) to focus resources on retaining high-value customers (Pareto Principle).

Question 8

"Churn Rate" in banking refers to:

The rate at which employees leave.The percentage of customers who close their accounts or stop doing business with the bank over a period.The speed of cheque clearing.The interest rate fluctuation.

View Explanation

Churn (Attrition) is the opposite of retention. High churn indicates dissatisfaction. Banks use predictive analytics to identify "at-risk" customers and retain them.

Question 9

"Customer Lifetime Value" (CLV) is calculating:

The profit from a single transaction.The total deposits of the customer.The net present value of the future profit stream expected from a customer over the entire relationship.The age of the customer.

View Explanation

CLV helps banks decide how much to spend on acquiring and retaining specific customers. High CLV customers warrant higher investment.

Question 10

Offering a "Platinum Credit Card" to a customer who already holds a "Silver Credit Card" is an example of:

Bundle PricingDown-SellingUp-SellingCross-Selling

View Explanation

Up-selling involves encouraging the customer to purchase a higher-end product (upgrade) than the one they currently have or are considering. Cross-selling would be selling a different product (like a loan).

Question 11

Which of the following is the correct sequence of stages in CRM implementation?

Software Installation -> Hiring Staff -> Profits.Data Collection -> Data Analysis -> Customer Segmentation -> Targeted Marketing.Marketing -> Sales -> Service.Analyze -> Interact -> Collect Data.

View Explanation

Effective CRM starts with gathering data, cleaning and analyzing it to create segments, and then executing targeted campaigns based on those insights.

Question 12

Which technology is essential for effective CRM to store and analyze vast amounts of historical customer data?

RouterFirewallATM SwitchData Warehouse

View Explanation

A Data Warehouse integrates data from various sources (loans, deposits, cards) to provide a unified view of the customer, which is the foundation of Analytical CRM.

Question 13

What is "Wallet Share" in CRM?

The discount given to customers.The amount of cash in a customer's wallet.The percentage of a customer's total financial business (deposits/loans) that is with a specific bank.The share of the bank in the stock market.

View Explanation

CRM aims to increase Wallet Share. If a customer has ?100 savings and keeps ?80 with Bank A, Bank A has an 80% wallet share.

Question 14

The first stage in implementing a CRM strategy is usually:

Implementing Software.Designing Campaigns.Data Collection and Cleansing.Training Staff.

View Explanation

Before any analysis or software can work, the bank must ensure it has accurate, consolidated customer data. Garbage In, Garbage Out applies.

Question 15

"Sales Force Automation" (SFA) is a core component of:

Collaborative CRMSocial CRMOperational CRMAnalytical CRM

View Explanation

Operational CRM includes tools for Sales Force Automation (tracking leads, sales pipeline), Service Automation, and Marketing Automation to streamline daily business processes.

Question 16

In the context of CRM, "Market Basket Analysis" is a data mining technique used to:

Analyze stock market trends.Calculate branch profits.Identify products that are frequently bought together (Cross-selling opportunities).Predict employee attrition.

View Explanation

This technique analyzes purchase patterns (e.g., "Customers who bought Home Loans also bought Insurance") to design effective product bundles and cross-sell offers.

Question 17

Which of the following is NOT a benefit of high "Customer Retention"?

Increased marketing costs for acquisition.Free word-of-mouth publicity.Higher opportunity for cross-selling.Lower cost of servicing existing customers.

View Explanation

Retention REDUCES overall marketing costs because acquiring new customers is far more expensive. Retained customers buy more and refer others.

Question 18

The "Next Best Product" (NBP) model in Analytical CRM helps banks to:

Recommend the most relevant product a customer is likely to buy next based on their profile and history.Calculate the bank's profit.Predict which employee will resign.Identify fraudulent transactions.

View Explanation

NBP models use predictive analytics to increase cross-selling success rates by offering the right product at the right time, rather than random selling.

Question 19

A "360-degree view" of the customer in CRM means:

Having a consolidated view of all the customer's interactions, accounts, complaints, and history with the bank across all channels.Taking a photo of the customer from all angles.Tracking the customer's physical location.Knowing the customer's family details only.

View Explanation

This unified view is essential for understanding the customer's total relationship value, identifying cross-sell opportunities, and providing better service.

Question 20

"Collaborative CRM" focuses on:

Managing vendors.Sales automation.Integrating communication channels (Phone, Email, Web) to share customer information across teams for a consistent service experience.Analyzing data.

View Explanation

Collaborative CRM ensures that if a customer complains via email, the call center agent also knows about it, providing a unified interface.

JAIIB Quiz

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