Question

According to the _____, while advertising, sales and promotions pour profits into your company, there will always be some customer defection, which has the potential to grow larger.

A. Bucket theory
B. Iceberg principle
C. 80/20 principle
D. Service paradigm
E. Echo principle of marketing

Answer 1

The 80/20 principle suggests that while advertising, sales, and promotions can bring profits to a company, there will always be some customer defection, which has the potential to grow larger.

Step-by-step explanation:

The correct option for the given statement is C. 80/20 principle. The 80/20 principle, also known as the Pareto principle, states that 80% of the effects come from 20% of the causes. In the context of the question, it means that 80% of the profits come from 20% of the customers. This principle suggests that while advertising, sales, and promotions can bring profits to a company, there will always be some customer defection, which has the potential to grow larger.