Which of the following tools is most appropriate to employ to improve profitability?

A firm supplies a single line of products to consumers using retail stores and on-line sales, distributors, and wholesalers. Currently the firm has common pricing and response times for sales in each sales channel.

Which of the following tools is most appropriate to employ to improve profitability?

A. Customer segmentation

B. Customer-facing ordering systems

C. Customer relationship management (CRM)

D. Supply Chain Operations Reference (SCOR®)

View Answer

Answer: A

Explanation:

Context: The firm uses common pricing and response times across different sales channels and seeks

to improve profitability.

Options Breakdown:

A. Customer segmentation: Allows the firm to tailor pricing and service levels to different customer groups based on their specific needs and value, enhancing profitability.

B. Customer-facing ordering systems: Improve the ordering process but do not directly impact pricing or profitability.

C. Customer relationship management (CRM): Helps manage customer interactions but does not directly address segmentation for pricing.

D. Supply Chain Operations Reference (SCOR®): Provides a framework for improving supply chain processes but is not directly focused on customer segmentation.

Correct Answer Justification: By employing customer segmentation, the firm can differentiate pricing and service levels to better match customer value and demand patterns, thereby improving profitability.

Reference: Marketing and supply chain management literature

Best practices in customer segmentation for profitability enhancement