Deck 14: Retailing

Question 1

In a franchise, a franchisor pays a franchisee for the right to use its name, product, and methods of operation.

Answer 1

False

Question 2

Service quality is a priority in service industries because they are so customer oriented.

Answer 2

True

Question 3

Determining a target market is optional while creating the retailing mix.

Answer 3

False

Question 4

The use of mobile devices and social media while browsing, comparison shopping, and making a purchase limits retailers from accessing any useful information about their customers, thereby giving retailers no concrete way to appeal to shoppers.

Question 5

Redoubt Nation, a specialty store that sells adventure sports gears, employs one salesperson per customer. Each salesperson is required to influence customers to purchase items related to the products they have purchased. In this scenario, Redoubt Nation is using _____ as its marketing strategy.

A)low employee density
B)suggestion selling
C)merchandise type
D)trading up

Question 6

Specialty stores compete on the basis of low prices, high turnover, and high volume.

Question 7

Target markets in retailing are often defined by demographics, geographic boundaries, and psychographics.

Question 8

Suggestion selling by sales or service associates should always help shoppers recognize true needs rather than sell them unwanted merchandise.

Question 9

Shopper marketing is responsible for the decline of the partnership trend between brand manufacturers and specific retailers.

Question 10

Establishing channel-wide network coherence is a key factor in maintaining service quality.

Question 11

Salespeople should practice trading-up techniques, whether customers need those products or not, to increase overall product sales.

Question 12

Since retail prices are usually based on the cost of the merchandise, an essential part of pricing is efficient and timely buying.

Question 13

Customers are always skeptical about the reasons for retailer errors, however, their reactions to mistakes such as product stockouts and unexpectedly poor quality products are limited to casual indifference.

Question 14

Higher prices often indicate a level of exploitation that weakens the prestigious image of retailers.

Question 15

Retailers can better acquire and use assets when they customize store layouts and merchandise mixes to the tastes of local consumer bases.

Question 16

Floor stock refers to the inventory held in reserve for potential future sale in a retailer's storeroom or stockroom.

Question 17

Will, a salesperson at a superstore, mistakenly provides wrong information to a customer about the location of a specific brand of dishwashing liquid. The customer, as a result, wastes time searching for the product. This is an example of brand cannibalization.

Question 18

Unlike supermarkets, convenience stores:

A)charge lower prices.
B)carry a much more limited line of high-turnover convenience goods.
C)enable customers to shop without visiting a physical store location.
D)offer no service to customers.

Question 19

Unlike nonstore retailing, in-store retailing enables customers to shop without visiting a physical store location.

Question 20

In-store retailing adds a level of convenience for customers who wish to shop from their current locations.

Question 21

Henry runs Moonlight Café, a world renowned fast-food restaurant, in his locality. He started the restaurant after getting a license from Moonlight Café and by regularly paying it a fee for the right to use its brand name, products, and methods of operation. Henry most likely operates a(n) _____.

A)independent retail store
B)warehouse club
C)chain store
D)franchise

Question 22

Providing great customer service is one of the most challenging elements in the retail mix because:

A)customer relations do not increase brand value.
B)customers are indifferent to service quality.
C)customer expectations for service vary greatly.
D)customers do not trust retail salespeople.

Question 23

In addition to making shopping easy and convenient for the customer, an effective layout:

A)heightens the olfactory sense of the customers.
B)provides customers with the ability to easily replace sold items.
C)can persuade customers to purchase expensive products.
D)has a powerful influence on traffic patterns and purchasing behavior.

Question 24

Asif, a member of a local baseball team, broke his bat during a practice match. With the final match scheduled for the next day, Asif urgently required a new bat. Therefore, he placed an order on Duke.com, an online portal for sports goods, and he dropped in at its nearest physical store to pick up his order. This is an example of the use of _____.

A)microtargeting
B)click-and-collect
C)telemarketing
D)e-tailing

Question 25

Which of the following statements is true of retail channel omnification?

A)Physical and online stores are combined into a single system for delivering on customer demand.
B)Consumers are required to pick up their orders from a physical store after purchasing them online.
C)Physical stores are replaced by warehouses to store goods that can be purchased online.
D)Consumers are required to visit physical stores before getting access to their online store.

Question 26

At the store level, the goal of tactical retailing is to:

A)eliminate the need for segmenting a market.
B)increase the sales of a specific item.
C)increase overhead costs.
D)eliminate the need for new advertising campaigns.

Question 27

Which of the following statements is true of click-and-collect?

A)It requires representatives to sell products door-to-door, in offices, or at in-home sales parties.
B)It employs outbound and inbound telephone contacts to sell directly to customers.
C)It enables consumers to make their purchases online and pick up their orders from physical stores.
D)It allows customers to shop over the Internet and have items delivered directly to their doors.

Question 28

_____ is a selling technique that seeks to broaden customers' original purchases with related items.

A)Suggestion selling
B)Co-marketing
C)Shopper marketing
D)Benefit selling

Question 29

Which of the following is a similarity between factory outlets and off-price retailers?

A)Both sell at prices 25 percent or more below traditional department store prices.
B)Both offer high levels of customized service to customers.
C)Both follow an agile approach to inventory.
D)Both carry multiple product lines that are considerably deep.

Question 30

Service delivery can be improved by:

A)implementing a no-return policy after sale.
B)maximizing wait times for customers.
C)increasing the costs of services provided.
D)choosing the right distribution channel.

Question 31

_____ is the technique used to sift through the data collected by point-of-purchase scanning equipment.

A)Big data analysis
B)Shopper marketing
C)Market-basket analysis
D)Shopper analytics

Question 32

A _____ is a discount store that carries a vast depth and breadth of product within a single product category.

A)supercenter
B)specialty discount store
C)warehouse club
D)full-line discount store

Question 33

The first element in the retailing mix is the _____.

A)retail promotion
B)product offering
C)retail location
D)product pricing

Question 34

A _____ is the originator of a trade name, product, methods of operation, and the like that grants operating rights to another party to sell its product.

A)broker
B)franchisor
C)consumer
D)wholesaler

Question 35

_____ is an emerging retailing trend that employs market data to best serve customers as they prepare to make a purchase.

A)Channel omnification
B)Click-and-collect
C)Shopper marketing
D)Cloud computing

Question 36

A(n) _____ is a retail business where the operator is granted a license to operate and sell a product under the brand name of a larger supporting organizational structure.

A)chain store
B)independent retail store
C)franchise
D)factory outlet

Question 37

Which of the following is a difference between off-price retailers and specialty shops?

A)Off-price retailers keep a greater amount of floor stock, whereas specialty shops keep a lower amount of floor stock.
B)Off-price retailers charge higher prices for customers, whereas specialty shops charge lower prices for customers.
C)Off-price retailers focus on lean inventory management, whereas specialty shops have an agile approach to inventory.
D)Off-price retailers focus on providing high quality customer service, whereas specialty shops de-emphasize customer service.

Question 38

_____ represents all the activities directly related to the sale of goods and services to the ultimate consumer for personal, nonbusiness use.

A)Product development
B)Production
C)Retailing
D)Manufacturing

Question 39

Unlike off-price retailers, specialty shops:

A)adopt an operating model that implies low prices for customers.
B)focus on lean inventory management.
C)can accommodate a broader range of customer demands.
D)de-emphasize customer service and product selection.

Question 40

_____ is a form of nonstore retailing that entails the use of machines to offer goods for sale.

A)Direct retailing
B)Telemarketing
C)Automatic vending
D)E-tailing

Question 41

Strategic retailing goals typically focus on:

A)reducing costs of goods sold.
B)increasing costs of goods sold.
C)reducing return on assets or equity.
D)not using a retailing mix.

Question 42

Which of the following statements is true of service failures?

A)They can be eliminated by successful market segmentation.
B)Retailers cannot recover from service failures.
C)They can be solved by canceling return policies.
D)If handled effectively, they can result in higher customer loyalty.

Question 43

Briefly explain the process of defining a target market.

Question 44

Lily's Apparel, a renowned apparel store, focuses on Gen Y customers and provides them with a customized clothing experience. Lily's Apparel has defined its target market by _____.

A)religion
B)educational qualifications
C)geographic boundaries
D)psychographic characteristics

Question 45

Why is it important to maintain service quality in service industries? Explain the four areas that service distribution should focus on to maintain the quality of service.

Question 46

Briefly explain the actions a retailer should take to address retail product/service failures.

Question 47

Zeta Inc., a multinational retail corporation, uses a device that notifies the respective store managers whenever a customer is near their store. It also helps them to map customer foot traffic data. This is an example of _____.

A)cloud computing
B)a beacon
C)shopper marketing
D)click-and-connect

Question 48

Which of the following statements is true of big data analytics?

A)It analyzes customers' needs based on their proximity to a retail store.
B)It focuses on understanding the behavior of a brand's target customers.
C)It enables retailers and suppliers alike to gain better customer insights.
D)It allows customers to evaluate the service quality offered by retailers.

Question 49

Delta Graphics Inc., a company specializing in publishing educational books, recruits and trains college students to sell its products door-to-door. Which of the following forms of nonstore retailing is illustrated in this scenario?

A)Direct retailing
B)Telemarketing
C)Automatic vending
D)E-tailing

Question 50

The Hunt, a liquor store, is famous for its unique and extensive collection of alcoholic beverages. Its employees possess up-to-date knowledge of the liquor available in the store, which allows them to assist customers in their purchasing decisions. The Hunt is an example of a _____.

A)supermarket
B)specialty store
C)warehouse club
D)convenience store

Question 51

What is brand cannibalization? Why is it dangerous to the retailer?