Statement–Argument — Should firms prioritize acquiring new clients? Arguments: I) Yes; new clients expand the revenue base and future growth opportunities. II) No; focusing on acquisition can degrade service to existing clients. Choose the strong argument(s).

Difficulty: Easy

Correct Answer: If either I or II is strong.

Explanation:

Introduction / Context:Customer-portfolio strategy balances acquisition and retention. Over-indexing on either dimension can harm long-run value.

Given Data / Assumptions:

  • Acquisition feeds pipeline growth and diversification.
  • Retention preserves lifetime value and referrals.
  • Resources (sales, support) are limited and must be allocated.

Concept / Approach:Argument I is strong: growth often requires new accounts. Argument II is also strong: neglecting current clients can trigger churn and reputational damage. Each is independently persuasive; the optimal strategy is a balanced funnel with service SLAs.

Step-by-Step Solution:

1) I: revenue scaling rationale → strong.2) II: retention/service quality rationale → strong.3) Mark “either.”

Verification / Alternative check:Firms often set separate teams/targets for “land” and “expand,” reflecting both arguments’ validity.

Why Other Options Are Wrong:“Only I/Only II” ignores the countervailing imperative; “Neither” denies basic business truths.

Common Pitfalls:Chasing growth while underfunding post-sale success management.

Final Answer:If either I or II is strong.

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