•Read the article below about business and customers and the questions on the opposi

te page.

•For each question 13-18, mark one letter (A, B, C or D)on your Answer Sheet for the answer you choose.

Focus on Your Customer

If you think of the most successful companies around the world -- GM, Wal-Mart, IBM, etc. -- they all have one thing in common: loyal customers. It can cost ten to twenty times as much to acquire a customer as to retain one, so it's easy to understand why customer relationship management is such a hot concept. But, while everyone understands CRM is a good thing, putting a CRM strategy together isn't easy. The place to start？ A customer-driven business model.

A customer-driven business model is the most prudent method of ensuring customer loyalty because it fosters a better relationship with new and existing customers. Others such as market, price, cost or e-commerce-driven business models may generate profits, but fall short of sustaining a loyal customer base. At the heart of customer-driven business model is a clear understanding of the customer -- not just customer trends (although this is useful information, too), but the buying habits and history of every one of your customers. This 360-degree view provides analytics from multiple channels (direct, web, fax, E-mail, call center, sales/marketing) and consolidates into a common repository. Monitoring buying habits and tracking market dynamics lets you more effectively market new and existing products and services.

If you think this is a daunting task, you aren't alone. Because most enterprises don't have a consolidated view of their customers, obtaining customer profit and cost information is often a Herculean effort.

Implementing a CRM solution is usually a huge project with a high probability of failure. Some analysts suggest most businesses underestimate the cost of a CRM Implementation by 40～75 percent. In fact, a successful CRM will interface with ERP systems to provide integration with all customer interactions such as order processing, billing. Also, CRM strategies must include commitment and sponsorship from senior management, as it should be deemed a strategic investment that is implemented incrementally and evolutionary.

Understanding critical success factors, such as those listed in the "Key to CRM Success" sidebar, mitigates the risks. First, start with a cultural change that focuses on a customer-centric business strategy. Make sure your organization is well aware of the high cost of customer attrition and is focused on improving retention, increasing loyalty. Understanding and broadcasting the cost of acquiring new customers versus fostering existing relationships.

Second, focus on an enterprise view of the customer that encompasses all customer data, such as communication history, purchasing behaviors, channel preferences, demographics, etc. Understand your customers' preferred channels and determine if there's some way to optimize them.

Adopt a flexible architecture that will expand with your business -- this is true with any IT project. Never deploy a strategic, costly solution using the big-bang approach. Always take an incremental, evolutionary, or iterative approach. The impact to your organization can be significant, thus, proceed slowly and ensure the returns on investment measures are in place.

The first paragraph indicates that loyal customers

A．help reduce costs of the company.

B．are quite common around the world.

C．produce huge profits.

D．are costly to develop.