CSR Exam 3 Study Guide

Interaction

Continuous exchange of information between a company and its customers to improve personalization and service.

Privacy

A customer's right to control how their personal data is collected, used, stored, and shared.

GDPR (General Data Protection Regulation)

EU law giving individuals strong control and transparency over their personal data.

GDPR Rights

Right to be informed, access, rectification, erasure, restrict processing, data portability, object, and protection from automated decision‑making.

COPPA

U.S. law protecting children under 13; requires parental consent for data collection.

Privacy Pledge

A company's public statement explaining how it collects, uses, and protects customer data.

Opt‑In Policy

Requires explicit customer permission before collecting or using personal information.

Virtuous Cycle

When responsible data use → added value → trust → more data → better personalization.

Expanded Need Set

Broader needs related to a customer's core need, satisfied through add‑ons, services, or information.

Modularization

Designing products/services as interchangeable modules that can be mixed to meet individual needs.

Configuration

The specific combination of modules chosen to meet a customer's preferences.

Business Rules

Instructions a company follows when configuring processes differently for different customers.

Basic Customization Algorithms

Trending items, similar items, co‑browsed items, co‑buy items, recently published, soon to expire.

Advanced Customization Algorithms

Collaborative filtering, decision trees, text analysis, contextual analysis.

Subscription Economy

Business model based on recurring revenue through ongoing subscriptions.

Customer Success Management

Ensuring customers achieve desired outcomes; reduces churn and increases upsell.

Customer Lifetime Value (LTV)

Total economic value a customer generates over their relationship with a company.

Return on Customer (ROC)

Measures value created from customers, not money invested.

Customer Equity

Total combined lifetime value of all customers.

Proxy Variables

Indirect measures used when exact LTV is unknown (RFM, volume, duration, feedback).

RFM

Recency, Frequency, Monetary value.

Short‑Termism

Over‑focusing on quarterly profits instead of long‑term customer relationships.

Content Marketing

Providing valuable content to attract and convert prospects.

Customer Advocacy

When customers voluntarily promote a brand due to trust and satisfaction.

Get, Keep, Grow Framework

• Get - Acquire customers • Keep - Retain profitable customers • Grow - Upsell, cross‑sell, referrals.

A/B Testing

Testing two versions (A vs. B) to see which performs better.

Bayesian Analysis

Updating probability based on new evidence.

Customer Insights

Blend of data science + interpretation to understand customer behavior.

Big Data

Data sets too large/complex for traditional tools.

Small Data

Qualitative insights from interviews, observations, etc.

Unstructured Data

Text, video, social posts; must be cleaned to be useful.

Data Cleaning

Removing errors, standardizing, formatting, organizing.

Classification

Assigning items to categories.

Estimation

Predicting a continuous value.

Regression

Forecasting outcomes using existing variables.

Prediction

Using historical data to estimate future behavior.

Clustering

Grouping customers by similarity.

Martech Stack

All technologies supporting marketing (CRM, CDP, analytics, automation, CMS, social tools).

Balanced Scorecard

Measures performance across financial, customer, internal process, learning & growth.

Correlation ≠ Causation

Two variables moving together does not mean one causes the other.

Customer‑Centric Enterprise

Every department contributes to building customer value.

IDIC Framework

Identify, Differentiate, Interact, Customize.

Customer Experience (CX)

Customer's perception of interactions across the relationship.

Self‑Service Channels

Apps, kiosks, chatbots; widely used but rarely fully resolve issues.

Relationship Governance

Who has authority to make customer‑specific decisions.

Customer Champion

Advocates for customer segments; influence but no authority.

Customer Manager

Manages and grows high‑value customers; has authority.

Customer Segment

Group of customers with shared characteristics.

Customer Portfolio

Group of customers managed by one customer manager.

Share of Customer

% of a customer's total needs the firm satisfies.

De‑Commoditization

Adding value through services, upgrades, personalization.

Customer Service vs. CRM

• Customer service = solve immediate problems • CRM = manage long‑term relationships.

Capabilities Building

Learning about customers individually and acting on that learning.

Capabilities Managers

Build systems, processes, and skills that support customer‑centricity.

Implications Wheel

Tool to map 1st, 2nd, 3rd‑order consequences of decisions.

Culture

"What people do when no one is watching"; shared values and norms.

Service Culture

Culture built around delivering excellent customer service.

Complex Adaptive Systems

Organizations must adapt quickly with flexible people and processes.

High‑Value Human Skills

Empathy, creativity, judgment, problem‑solving, interpretation, initiative.

Why Culture Matters

Affects trust, ethics, decision‑making, information flow, conflict handling, and definitions of success.

Technology + Humans

Tech augments human work but does not replace judgment‑based roles.