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Strategist: Customers often complain that incentives to attract new cl

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Strategist: Customers often complain that incentives to attract new cl [#permalink]

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New post 21 Jul 2017, 08:48
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Question Stats:

67% (01:04) correct 33% (01:21) wrong based on 218 sessions

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Strategist: Customers often complain that incentives to attract new clients are significantly more attractive than the incentives given to existing clients via loyalty programs. They do not understand, however, that such a strategy is essential to running a successful business.

Which of the following, if true, would most strengthen the strategist’s argument?

A. Many companies choose to invest in customer incentives that attract new clients, and avoid loyalty programs altogether.
B. A company can only be successful if it continually attracts new clients.
C. Customer loyalty programs are only valuable in certain industries, such as travel and internet service.
D. In most industries, competition keeps profit margins small enough that companies must choose between incentives for new customers and incentives for loyal customers.
E. No company can be successful without a strategic approach to client retention.​
[Reveal] Spoiler: OA

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Re: Strategist: Customers often complain that incentives to attract new cl [#permalink]

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New post 21 Jul 2017, 08:55
gauravraos wrote:
Strategist: Customers often complain that incentives to attract new clients are significantly more attractive than the incentives given to existing clients via loyalty programs. They do not understand, however, that such a strategy is essential to running a successful business.

Which of the following, if true, would most strengthen the strategist’s argument?

A. Many companies choose to invest in customer incentives that attract new clients, and avoid loyalty programs altogether.
B. A company can only be successful if it continually attracts new clients.
C. Customer loyalty programs are only valuable in certain industries, such as travel and internet service.
D. In most industries, competition keeps profit margins small enough that companies must choose between incentives for new customers and incentives for loyal customers.
E. No company can be successful without a strategic approach to client retention.​


Customers - Incentives for new clients > Incentives for existing clients.
Strategist - Such a strategy essential.
Why ? You cannot run a business without attracting new customers regularly.

A - Many, Most. Well it doesn't impact all companies, so this is OUT.
B - Keep.
C - Certain Industries ? This creates a subset, which is irrelevant to the argument. OUT.
D - Most Industries ? Same as C. OUT.
E - This actually weakens the conclusion slightly by saying that companies need a customer retention strategy. OUT.

B is the answer.
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Re: Strategist: Customers often complain that incentives to attract new cl [#permalink]

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New post 21 Jul 2017, 09:37
Strategist: Customers often complain that incentives to attract new clients are significantly more attractive than the incentives given to existing clients via loyalty programs. They do not understand, however, that such a strategy is essential to running a successful business.

Which of the following, if true, would most strengthen the strategist’s argument?

A. Many companies choose to invest in customer incentives that attract new clients, and avoid loyalty programs altogether.Many companies choose to do that but why, also this does not address any of the point in the argument.
B. A company can only be successful if it continually attracts new clients.Correct
C. Customer loyalty programs are only valuable in certain industries, such as travel and internet service.we are not aware of the industry in the given argument
D. In most industries, competition keeps profit margins small enough that companies must choose between incentives for new customers and incentives for loyal customers.in ost industries but not all and wea re not aware of what industry are we discussing about.
E. No company can be successful without a strategic approach to client retention.​Weanes and not supports the claim of the strategist.

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Re: Strategist: Customers often complain that incentives to attract new cl [#permalink]

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New post 23 Jul 2017, 06:19
I thought the answer is D.... I was between B and D and chose D because it gives a difference between new customers and loyal customers.

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Re: Strategist: Customers often complain that incentives to attract new cl [#permalink]

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New post 23 Jul 2017, 06:34
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There are a lot of prep company CR questions that ask you to strengthen an "argument", but which don't provide you with any "argument" to strengthen. The stem here is not an argument; it's only a claim. The claim is: companies need to use this customer incentives strategy to be successful. The stem doesn't reach that as a conclusion from a set of facts or premises, so there's no argument here. Real GMAT CR questions aren't like this.
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Re: Strategist: Customers often complain that incentives to attract new cl [#permalink]

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New post 24 Jul 2017, 22:22
Solution
The conclusion of this Strengthen problem is that spending more money on customer acquisition programs than on customer retention programs is ESSENTIAL to running a successful business. Therefore, to strengthen this argument you want evidence that a business cannot be successful without this emphasis on customer acquisition.

Choice B provides exactly that: if a company can ONLY be successful if it continually attracts new clients, then customer acquisition is essential...it's the only way for a company to succeed. Choice B is correct, and also brings up an important point: while in an Inference context extreme language (such as "only," "all," "never," etc.) is hard to prove, in a strengthen context it is a great weapon. What better way to strengthen your argument than with an absolute statement?

Note that choice A only expresses a preference that many companies have, but does not directly assess whether it is essential to their success. What if they're all wrong?

Choice C is similar: it offers a reason why companies might prefer to prioritize customer acquisition in many industries, but it does not show the unique necessity of customer acquisition as is stated in the conclusion.

Choice D demonstrates why it might be important for a company to declare either retention or acquisition as a priority, but it stops short of making a case why acquisition should be that priority.

And choice E goes the opposite way, showing that customer retention is essential, while the argument you're strengthening is that customer acquisition is essential.

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Re: Strategist: Customers often complain that incentives to attract new cl [#permalink]

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New post 09 Nov 2017, 15:00
E is a great trap b/c E is too extreme. No such inference can be deducted from the passage.
B is right b/c of "continually"

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Re: Strategist: Customers often complain that incentives to attract new cl   [#permalink] 09 Nov 2017, 15:00
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Strategist: Customers often complain that incentives to attract new cl

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