Deck 15: Consumer Behavior Online

Question 1

In comparing two online e-tailers, Walmart.com vs. DeepDiscounts.com, Walmart.com should be considered the better online business based on brand name reputation and the fact that Walmart has a brick and mortar store.

Answer 1

True

Question 2

A bottle of wine would be considered an experience good.

Answer 2

True

Question 3

The cost of information search is based on how difficult it is to acquire information in terms of time.

Answer 3

False

Question 4

According to your readings, in a recent study of online retailers by BizRate.com, it was found that online business success depends on the brand being sold, the number of products sold by the e-tailer, and the quickness with which consumers could navigate the web site.

Question 5

Online stores usually offer greater customization to consumers than brick and mortal stores.

Question 6

Online stores have virtually unlimited inventory because suppliers are always willing to fulfill orders regardless of the customization requirements.

Question 7

Internet marketing uses one-way communications between marketers and consumers with fast response times between communications and low levels of response contingency.

Question 8

A picture frame would likely be an example of a search good.

Question 9

When consumers use a non-compensatory strategy, they don't make tradeoffs across attributes, and a bad attribute usually leads to the rejection of an alternative.

Question 10

The quality of search goods can be examined by simply examining the product.

Question 11

Flow is experienced when people perform an activity skillfully with in-depth thought and effort.

Question 12

An e-tailer is a retailer that operates on the Internet.

Question 13

Interactivity makes it easy for consumers to provide e-tailers with the information that they want- including credit card numbers, e-mail addresses, shipping addresses, personal preferences, and purchase histories.

Question 14

Use of a risk-free return policy to build trust and to assure consumers that its products are of high quality would be an effective way to sell an experience good for an e-tailer.

Question 15

Ranking and ordering ads in terms of relevance to a consumer's search rather than in terms of dollars is an example of how online marketing differs from brick and mortar marketing.

Question 16

E-tailers are usually better at selling search and credence goods than experience goods.

Question 17

The following are examples of information that e-tailers want: credit card numbers, e-mail addresses, birth dates, personal preferences, and social security numbers.

Question 18

Panama used by Yahoo! is an example of online marketing that gives advertisers more control by allowing them to change strategies and keywords to adapt to changing consumer preferences.

Question 19

Information search is greater and information search costs are higher in online (vs. off-line) environments.

Question 20

The quality of experience goods can only be determined by long term use of the product.

Question 21

Ryan buys a new T.V. about every 5 years and by reading Consumer Reports and other independent sources, he has a good idea as to what attributes entail a smart T.V. purchase. Next time he is ready to purchase a T.V., Ryan is likely to make an impulse buy and not research the different brands because he is moderately familiar with the industry and doesn't buy a new T.V. very often.

Question 22

Consumers are less likely to use a compensatory strategy if a web site is organized by options rather than by attributes.

Question 23

The relationship between prior knowledge and the amount of information search a consumer will engage in is a positive correlation.

Question 24

Search costs are lower in online environments than in offline environments, such as the grocery store.

Question 25

Consumers often make better decisions if they use a compensatory strategy rather than a non-compensatory strategy.

Question 26

A comparison matrix is a reporting aid that helps consumers evaluate reviews of a product by providing a Consumer Reports style brand-by-attribute matrix that makes the decision for the customer as to which brand is best.

Question 27

Involvement and risk are often positively correlated when making a purchasing decision.

Question 28

As easy of comparison shopping increases, cost transparency decreases.

Question 29

One outcome of relationship marketing programs is more one-to-one marketing or individualized transactions with customers.

Question 30

Cost transparency can actually lower brand loyalty.

Question 31

According to Glen Urban, a former Dean of the MIT Sloan School of Management, the best way for firms to respond to consumer power brought about by the Internet is to find new ways to persuade consumers.

Question 32

The relationship between the online and offline efforts of a brand is symbiotic.

Question 33

Research shows that price sensitivity is higher when quality comparability is high rather than low for a typical online shopper.

Question 34

A recommendation agent is an interactive decision aid that helps consumers to eliminate options by using information about their personal preferences or about their prior purchase histories.

Question 35

"Red Hawk Clothing" is a start up and intends to build trust and a long lasting relationship with their customers. They intend to profit by return shoppers and a long term approach to building a strong brand. Consumer advocacy aligns strongly with their business approach.

Question 36

A new clothing line is being developed called "Red Hawk" enterprises. If Red Hawk sold clothes via a brick and mortar shop, it will most likely improve sales of Red Hawk's e-tailing efforts.

Question 37

Relationship marketing programs involve building stronger relationships with consumers by using consumer reports advice and improved advertising efforts.

Question 38

Consumers generally trust large corporations.

Question 39

Consumer advocacy programs can benefit all companies.

Question 40

When giving consumers options among product attributes while shopping online, it is good to make options negatively correlated to force consumers to make trade-offs.

Question 41

Which of the following would most likely be considered a credence product?

A) silverware
B) coffee mug
C) box of donuts
D) laptop computer
E) toothbrush

Question 42

In addition to making shopping easy, the Internet makes shopping fun, at least for some consumers. People have the most fun when they are in a state of _____, which is experienced when people perform an activity skillfully with little thought or effort.

A) continuity
B) breeze
C) ease
D) continuance
E) None of the above is correct.

Question 43

Electronic retailers are commonly referred by what term?

A) I-tailers
B) E-tailers
C) Internet merchants
D) Bricks and mortar retailers
E) Interactivity agents

Question 44

Online stores enable consumers to shop for products:

A) across states
B) between cities
C) across country borders
D) between stores
E) All of the above are correct.

Question 45

Which of the following is not one of the main categories discussed in your readings that e-tailers need to focus on when designing a web site?

A) Level of customization
B) Navigation
C) Information search
D) How information is organized to facilitate choice
E) All of the above are correct.

Question 46

The biggest difference between online stores and brick and mortar stores is that online stores offer greater _____ and greater _____.

A) availability; accuracy
B) choice; customization
C) value; choice
D) opportunity; preference
E) discretion; evaluation

Question 47

E-tailers are more successful if they primarily sell _____, rather than _____ or _____.

A) search goods, experience goods; information goods
B) search goods, experience goods, credence goods
C) experience goods, credence goods, online products
D) credence goods, experience goods, search goods
E) online products, information goods, search goods

Question 48

The quality of _____ can be examined by simply examining the product or a picture of the product.

A) information goods
B) search goods
C) experience goods
D) credence goods
E) online products

Question 49

The quality of _____, can only be determined by touching, feeling, or using the product.

A) information goods
B) search goods
C) experience goods
D) credence goods
E) online products

Question 50

In a recent study of 755 e-tailers from BizRate.com, it was found that online business success depends on all of the following except:

A) brand name reputation
B) types of products sold
C) ease with which consumers could navigate the web site
D) web site's domain name
E) All of the above are correct.

Question 51

Traditional mass marketing uses tools like television, radio, newspapers and magazines to deliver a(n) _____ message to consumers about product benefits.

A) one-way
B) two-way
C) bilateral
D) customized
E) interactive

Question 52

In Internet marketing, _____ is when one party's response depends on the other party's response, and this helps both parties get the information they need when they need it.

A) consistency
B) collaboration
C) apprehension
D) complacency
E) contingency

Question 53

A picture frame would most likely be considered a:

A) information good
B) search good
C) experience good
D) credence good
E) online product

Question 54

In comparing two online e-tailers, Target.com vs. DavesDeepDiscounts.com, Target.com should be considered the better online business based primarily on:

A) a more descriptive name
B) a bricks and mortar operation that is well known
C) a wide variety of products
D) an efficient product delivery system
E) a better brand logo

Question 55

Which of the following is not a type of customer information that interactivity makes it easy for e-tailers to obtain?

A) E-mail addresses
B) Credit card numbers
C) Shipping addresses
D) Personal preferences
E) All of the above are type of consumer information.

Question 56

_____ refers to how much information consumers attempt to acquire.

A) Information search
B) Information search costs
C) Web 2.0
D) Information symmetry
E) Compiling information

Question 57

If an online business wanted to be successful, the company would be best served to have:

A) strong brand name reputation
B) a bricks and mortar operation that is well known
C) a wide variety of products
D) an efficient product delivery system
E) All of the above are correct.

Question 58

A frozen dinner would most likely be considered a:

A) information good
B) search good
C) experience good
D) credence good
E) online product

Question 59

When consumers use a _____, they make tradeoffs between attributes and this enables a good attribute to compensate for, or at least reduce concerns about, a bad attribute.

A) information accuracy strategy
B) search efficiency method
C) risk aversion method
D) compensatory strategy
E) non-compensatory strategy

Question 60

Liz loves to shop online. When she get on her favorite shopping web site, it is fun and effortless. When Liz shops online, she experiences:

A) continuity
B) breeze
C) flow
D) continuance
E) ease

Question 61

Consumer Advocacy is best for firms:

A) with quality control problems
B) that are monopolies
C) large corporations that consumers don't trust
D) firms with extreme price competition
E) firms with a long term focus

Question 62

Explain the differences between online stores and traditional brick and mortar stores.

Question 63

What are the three main categories that e-tailers need to focus on when designing a web site?

Question 64

Explain the differences between a recommendation agent and a comparison matrix.

Question 65

In terms of search goods, experience goods, and credence goods, which is easiest to sell online? Why?

Question 66

Research on traditional advertising has shown that _____, increases price sensitivity and encourages consumers to purchase the less expensive brand.

A) attribute advertising
B) price advertising
C) cross brand advertising
D) differentiating advertising
E) None of the above is correct.

Question 67

Consumers behave as limited information processors and are only able to consider about _____, plus or minus two, pieces of information at a time.

A) 7
B) 5
C) 2
D) 17
E) 13

Question 68

Involvement and risk tend to be related in that they tend to be:

A) opposite
B) negatively correlated
C) balanced
D) positively correlated
E) inverted

Question 69

The Internet has reduced all of the following types of costs for consumers except for:

A) information search costs
B) transaction costs
C) experience goods costs
D) product information costs
E) All of the above costs are reduced by the Internet.

Question 70

Molly decides to buy a new digital camera. She notices that the one of the attributes on the Cannon camera does not meet her requirements and because of this, she eliminates the Cannon camera. This strategy would best be considered what type of strategy?

A) Selective-conductive
B) Risk averse
C) Information accurate
D) Non-compensatory
E) Search inefficient

Question 71

Mike considers himself an expert on cell phones. He has extensive knowledge of the various providers and models. When it comes time to purchase a new cell phone, Mike will most likely engage in a(n_____ level of search information.

A) moderate
B) high
C) low
D) none at all
E) None of the above is correct.

Question 72

Involvement in a purchase will tend be high for all of the following except:

A) a car
B) a interviewing suit
C) a medical procedure
D) a magazine
E) All of the above will include high involvement.

Question 73

When online shopping, consumers tend to "click" on more options when alternatives are:

A) equal
B) negatively correlated
C) balanced
D) positively correlated
E) inverted

Question 74

_____ involves building stronger relationships with consumers by using information technology and improved business processes.

A) Online advertising
B) Relationship marketing
C) Transactional surveys
D) Process improvement initiatives
E) Attribute advertising

Question 75

Compare and contrast traditional mass marketing and Internet marketing.

Question 76

Research on online-offline brand alliances shows that such alliances encourage consumers to form what type of effect between online and offline brands?

A) Conversion effect
B) Contrast effect
C) Assimilation effect
D) Availability effect
E) Representativeness effect

Question 77

A(n) _____ is an interactive decision aid that helps consumers to eliminate options by using information about their personal preferences or about their prior purchase histories.

A) information agent
B) recommendation agent
C) consumer report
D) comparison matrix
E) None of the above is correct.

Question 78

Define search goods, experience goods, and credence goods, and provide an example for each.

Question 79

Define the goals and objectives of e-tailers relating to consumer interactivity online.

Question 80

When a web site is organized by customized options, this encourages what type of choice strategy?

A) Compensatory
B) Assimilated
C) Contingency
D) Balanced
E) Non-compensatory