Test Your Knowledge: Size of Customer Answers

Test Your Knowledge: Size of Customer Answers

Answer to Question 1:Small businesses are probably Medium sized customers in the accounting business world. Small customers would be individuals and sole proprietors. Large customers would be middle market corporations while the Fortune 1000 companies would be examples of Very Large customers.

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Answer to Question 2:The San Francisco Bay Area would be a Large or Very Large customer because it has significant buying power reachable by a few locations. Cities, such as Sacramento, would be Large customers. Mid-sized cities such as Toledo might be Medium customers and rural towns would be Small customers.

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Answer to Question 3:We define a customer as any one who could purchase directly from Compaq. With that definition, large corporations and large wholesalers are likely to be Very Large customers. The largest dealers are probably Large customers while most dealers would be Medium sized customers in the industry. Small dealers and medium sized companies were probably the Small customers in the market.

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Answer to Question 4:The travel agency market has evolved to the point where an agency must have relatively expensive and sophisticated systems and programs to support the industry's Very Large customers, the large corporations.

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Answer to Question 5:In planning for its new product features, the camcorder manufacturer considers end-user needs. This segmentation segments customers by age and marital status. It is primarily focused on finding ways to communicate with the end-use customer group. The camcorder manufacturers sell directly to channels of distribution rather than to end-users. The Very Large, Large, Medium and Small customers are members of the channels of distribution, not end-users. The end-users are customers of the channel.

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Answer to Question 6:Adstar was selling its products to personal computer manufacturers. In the early 1990s, there were over 300 manufacturers of personal computers. IBM would have been one of the Very Large customers. Most of the top ten computer manufacturers including Compaq, Hewlett Packard, Packard Bell, Apple and Dell would also have been Very Large customers.

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Answer to Question 7:The very large department stores are probably Large rather than Very Large customers in the marketplace. In the apparel market, they probably took second place to the Very Large customers, discounters such as Kmart, Wal-Mart, Target, and so forth. The independent specialty stores were Medium and Small customers in the marketplace.

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Answer to Question 8:The rock and rap business has a different set of Very Large customers than does the country western business. Traditional record stores like Tower, Musicland, and Wherehouse would target an urban adolescent and be Very Large customers for rock and rap music. Wal-Mart and its peers may be emerging as Very Large customers in the country western music market.

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Answer to Question 9:Discounters and supermarkets have emerged as Very Large and Large purchasers of cards while independent and branded card shops slip into Medium and Small sized segments.

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Answer to Question 10:DHL has defined its market as U.S. companies with global scope. This definition excludes companies outside of the U.S. Within that definition, though, customers would fall into the size segments as defined by their total purchases of package delivery services. In this context, the companies in the Fortune 500 list, with significant international operations, would probably Very Large customers. Other U.S. companies with international operations would fall into size segments according to their purchases of package delivery services.

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