With most companies, some customers are more valued or profitable for the firm than others. This is valuable information for a company—they can then better direct marketing and other efforts related to reaching and serving the most profitable part of its customer base. Discuss the type of costing you believe should be employed by a service firm to best help them to ascertain customer profitability.

With most companies, some customers are more valued or profitable for the firm than others. This is valuable information for a company—they can then better direct marketing and other efforts related to reaching and serving the most profitable part of its customer base. Discuss the type of costing you believe should be employed by a service firm to best help them to ascertain customer profitability.

Principles Of Marketing

17th Edition

ISBN:9780134492513

Author:Kotler, Philip, Armstrong, Gary (gary M.)

Publisher:Kotler, Philip, Armstrong, Gary (gary M.)

Chapter1: Marketing: Creating Customer Value And Engagement

Section: Chapter Questions

Problem 1.1DQ

See similar textbooks

Similar questions

If the marginal cost for a firm is higher than its average total cost, what can be said about the slope ofits average variable cost curve at this point?
Pick one good or service you would want to sell (supply) at Laguardia Community College. List and very briefly explain at least 3 of the factors that you would consider before you decide whether you want to see at all, how much you want to sell and the price you would want to charge. Try to think of these decisions from the perspective of a seller/producer. Avoid thinking from the perspective of a buyer/consumer.
Explain why a product or service’s contribution (selling price minus variable cost) is an important element in developing a marketing strategy, giving examples to illustrate your answer.
Describe the strategy of striving to be the industry's overall low cost provider. What does a company have to do to achieve low-cost provider status?
Discuss the 3 major components of the revenue cycle: Front, Middle, and back-end. What does each component consist of?
ABX manufactures large freezers for grocery stores. ABX is presently trying to plan its production and inventory levels for the next six months. Because of seasonal fluctuations in utility and raw materials costs, the per unit cost of producing freezers varies from month to month-as does the demand for the products. Production capacity also varies from month to month due to differences in the number of working days, vacations, and scheduled maintenance and training. The following table summarizes the monthly production costs, demands, and production capacity that ABX's management expects to face over the next 6 months. Unit Demanded Month Unit Production Cost $225 Maximum Production 1 1,200 4,000 2 $250 3,000 3,200 3 $230 5,000 3,800 5 $275 $290 6,000 6 5,500 3,500 3,600 4,000 $260 3,000 The warehouse can hold a maximum of 5,500 units in inventory at the end of each month. Management wants to keep at least 1,500 units in inventory as safety stock to balance variations in demand. To…
What knowledge and skills do you feel are required for a purchasing professional?
Describe how cost information supports important management activities including product pricing, product planning, budgeting, and performance evaluation.
Your friend Brianna is considering getting a credit card. She is going to use the credit card to help build her credit. The credit card she is considering has an APR of 24.99%. It also has a yearly fee of $150.00, but it does offer 1% cash back on most purchases. She asks you for your advice. Use CER to answer the question: Should Brianna get the credit card?
Should a firm pursue differentiation in an industry where customers are very price-sensitive? Use real-life example(s) to illustrate your answers.