Deck 2: E-Commerce Business Models and Concepts

Question 1

Which of the following is not a community provider?

A)LinkedIn
B)Facebook
C)Blue Nile
D)Pinterest

Answer 1

C

Question 2

All of the following can be considered a direct or indirect competitor of Amazon except:

A)eBay.
B)Apple's iTunes Store.
C)Walmart.
D)Priceline.

Answer 2

D

Question 3

Stickiness is an important attribute for which of the following revenue models?

A)advertising revenue model
B)subscription revenue model
C)transaction fee revenue model
D)affiliate revenue model

Answer 3

A

Question 4

Which element of the business model addresses what a firm provides that other firms do not and cannot?

A)competitive environment
B)competitive advantage
C)market strategy
D)value proposition

Question 5

A perfect market is one in which:

A)there are no competitive advantages or asymmetries because all firms have equal access to all the factors to production.
B)one firm develops an advantage based on a factor of production that other firms cannot purchase.
C)one participant in the market has more resources than the others.
D)competition is at a minimum, as each niche market within an industry is served by the company with the greatest competitive advantage.

Question 6

Which of the following involves a company giving away a certain level of product or services without charge, but then charging a fee for premium levels of the product or service?

A)advertising revenue model
B)subscription revenue model
C)freemium strategy
D)transaction fee revenue model

Question 7

A firm's ________ describes how a firm will produce a superior return on invested capital.

A)value proposition
B)revenue model
C)market strategy
D)competitive advantage

Question 8

Which of the following is an example of the affiliate revenue model?

A)Scribd
B)eBay
C)L)L. Bean
D)MyPoints

Question 9

Which of the following uses a subscription revenue model for books?

A)Spotify
B)Scribd
C)Rhapsody
D)Pandora

Question 10

All of the following would be considered a direct competitor of Priceline except:

A)Travelocity.
B)Expedia.
C)Orbitz.
D)ESPN.

Question 11

Organizations that typically provide an array of services to start-up companies along with a small amount of funding are referred to as:

A)angel investors.
B)crowdfunders.
C)incubators.
D)venture capital investors.

Question 12

The existence of many competitors in any one market segment may indicate:

A)an untapped market niche.
B)the market is saturated.
C)no one firm has differentiated itself within that market.
D)a market that has already been tried without success.

Question 13

________ and ________ are typically the most easily identifiable aspects of a company's business model.

A)Market strategy; market opportunity
B)Value proposition; revenue model
C)Competitive advantage; competitive environment
D)Revenue model; market opportunity

Question 14

Which of the following are Amazon's primary value propositions?

A)personalization and customization
B)selection and convenience
C)reduction of price discovery cost
D)management of product delivery

Question 15

Which of the following companies uses a transaction fee revenue model?

A)Yahoo
B)E*Trade
C)Twitter
D)Birchbox

Question 16

Which of the following is not a variation of the e-tailer business model?

A)bricks-and-clicks
B)virtual merchant
C)market creator
D)manufacturer-direct

Question 17

Which of the following factors is not a significant influence on a company's competitive environment?

A)how many competitors are active
B)what the market share of each competitor is
C)the availability of supportive organizational structures
D)how competitors price their products

Question 18

Which of the following is an example of the subscription revenue model?

A)eHarmony
B)eBay
C)E*Trade
D)Twitter

Question 19

A ________ specifically details how you plan to find customers and to sell your product.

A)sales analysis
B)business plan
C)competitive strategy
D)market strategy

Question 20

Which element of the business model refers to the presence of substitute products in the market?

A)value proposition
B)competitive environment
C)competitive advantage
D)market opportunity

Question 21

Which of the following is not an example of the bricks-and-clicks e-tailing business model?

A)Walmart
B)Sears
C)Bluefly
D)Staples

Question 22

Which type of investor typically becomes interested in a start-up company after it has begun generating revenue?

A)incubators
B)angel investors
C)crowdfunders
D)venture capital investors

Question 23

All of the following may lead to a competitive advantage except:

A)less expensive suppliers.
B)better employees.
C)fewer products.
D)superior products.

Question 24

Which of the following is an unfair competitive advantage?

A)brand name
B)access to global markets
C)lower product prices
D)superior technology

Question 25

A value proposition defines how a company's product or service will generate revenue for the firm.

Question 26

Information asymmetries enable some firms to have an edge over others.

Question 27

In 2017, the overall retail market in the United States was estimated to be about:

A)$50 trillion.
B)$5 trillion.
C)$500 billion.
D)$50 billion.

Question 28

________ is defined by company using its competitive advantage to gain in surrounding markets.

A)Market strategy
B)Differentiation
C)Leverage
D)Focus

Question 29

Firms that fail to produce returns greater than alternative investments typically go out of business.

Question 30

Which of the following uses a subscription-based sales revenue model?

A)Yahoo
B)eBay
C)MyPoints
D)Dollar Shave Club

Question 31

In general, the key to becoming a successful content provider is to:

A)own the content being provided.
B)own the technology by which content is created, presented, and distributed.
C)provide online content for free.
D)provide other services as well as online content.

Question 32

Which of the following statements about Foursquare is not true?

A)Foursquare combines a social network business model with location-based technology.
B)Foursquare has struggled to find profitability.
C)From 2014 to 2017, Foursquare's revenue doubled on a year-to-year basis.
D)Foursquare has decided to refocus its effort on developing a subscription-based revenue model.

Question 33

In the subscription revenue model, a company generates income from the placement of ads.

Question 34

All of the following use a social network marketing strategy except:

A)Twitter.
B)YouTube.
C)Pinterest.
D)Amazon.

Question 35

First movers are usually more successful than follower firms.

Question 36

A wealthy individual who invests personal funds in a start-up in exchange for an equity share in the business is referred to as a(n):

A)incubator.
B)angel investor.
C)venture capital investor.
D)crowdfunder.

Question 37

Which of the following gives a business model the most credibility with outside investors?

A)the firm's management team
B)the firm's value proposition
C)the firm's market opportunity
D)the firm's market strategy

Question 38

An example of a company using the content provider model is:

A)Priceline.
B)Rhapsody.
C)Dell.
D)eBay.

Question 39

Which of the following is another name for a revenue model?

A)business model
B)business strategy
C)financial model
D)financial statements

Question 40

Which of the following is not a key element of an elevator pitch?

A)exit strategy
B)growth metrics
C)legal structure
D)market opportunity

Question 41

First movers often fail because:

A)their competitive advantage is unfair.
B)they lack complementary resources needed to sustain their advantages.
C)they are operating in a perfect market.
D)they fail to leverage their competitive assets.

Question 42

The financial services, travel services, and job placement services industries typically use the ________ business model.

A)community provider
B)transaction broker
C)market creator
D)e-tailer

Question 43

What is the primary revenue model for an e-distributor?

A)sales
B)transaction fee
C)advertising
D)subscription

Question 44

All of the following use an advertising revenue model except:

A)Twitter.
B)Yahoo.
C)Google.
D)Amazon.

Question 45

Define and describe the transaction broker business model and discuss the eight components of the business model for this type of B2C firm.

Question 46

eBay uses all of the following business models except:

A)B2C market creator.
B)C2C market creator.
C)content provider.
D)e-commerce infrastructure provider.

Question 47

Portals primarily generate revenue in all of the following ways except:

A)charging advertisers for ad placement.
B)collecting transaction fees.
C)sales of goods.
D)charging subscription fees.

Question 48

________ create and sell access to digital markets.

A)E-distributors
B)Portals
C)E-procurement firms
D)Market creators

Question 49

In the ________ business model, a web-based business builds a digital environment in which buyers and sellers can meet, display products, search for products, and establish prices.

A)market creator
B)community provider
C)e-tailer
D)portal

Question 50

On-demand service companies are characterized by the free sharing of resources between the company and consumers.

Question 51

Amazon Business is an example of which of the following business models?

A)B2B service provider
B)exchange
C)e-distributor
D)industry consortia

Question 52

Define elevator pitch and describe its key elements.

Question 53

Define organizational development and describe its importance in relation to the implementation of a business plan and strategy.

Question 54

The basic value proposition of community providers is:

A)they offer a fast, convenient one-stop site where users can focus on their most important concerns and interests.
B)they offer consumers valuable, convenient, time-saving, and low-cost alternatives to traditional service providers.
C)they create a digital electronic environment for buyers and sellers to meet, agree on a price, and transact.
D)they increase customers' productivity by helping them get things done faster and more cheaply.

Question 55

All of the following are business models employed in the online music industry except:

A)subscription.
B)peer-to-peer streaming.
C)download-and-own.
D)cloud streaming.

Question 56

The Jumpstart Our Business Startups (JOBS)Act, and issuance of enabling regulations by the Securities and Exchange Commission, allows a start-up company to use crowdfunding to solicit investors to invest in small and early-stage start-ups.

Question 57

Why is the management team such an important element of a business model?

Question 58

Who are the e-commerce enablers and why are they important?

Question 59

All of the following are examples of business-to-business (B2B)business models except:

A)e-distributors.
B)e-procurement.
C)exchanges.
D)portals.

Question 60

Which of the following is not considered a portal?

A)Yahoo
B)MSN
C)Amazon
D)AOL

Question 61

Scale economies are efficiencies that result from increasing the size of the business.

Question 62

A ________ refers to a competitive strategy in which firms attempt to achieve lower business process costs.

A)strategy of cost competition
B)scope strategy
C)customer intimacy strategy
D)focus/market niche strategy

Question 63

The term unfit fitness refers to a situation in which employees of a firm have the wrong skills for the current environment.

Question 64

A ________ marketplace supplies products and services of interest to particular industries.

A)perfect
B)differentiated
C)horizontal
D)vertical

Question 65

The Seam is an example of a(n):

A)private industrial network.
B)exchange.
C)industry consortium.
D)e-distributor.

Question 66

What is a B2B exchange, and what benefits do they offer? Given those benefits, why are they currently only a small part of the overall B2B picture?

Question 67

________ technologies are technologies that enable the incremental improvement of products and services.

A)Sustaining
B)Differentiating
C)Disruptive
D)Commodity

Question 68

Interactivity that enables product customization alters industry structure by decreasing the threat of substitutes.

Question 69

E-commerce has increased price competition in many markets.

Question 70

Which of the following is not a primary activity in a firm value chain?

A)outbound logistics
B)finance/accounting
C)operations
D)after-sales service

Question 71

The Internet's universal standards can change industry structure by decreasing barriers to entry and increasing competition within an industry.

Question 72

If you wished to leverage the ubiquitous nature of the Web to differentiate your product, you would:

A)enable individual customization of the product by consumers.
B)implement a strategy of commoditization.
C)adopt a strategy of cost competition.
D)develop a scope strategy to compete within a narrower market segment.

Question 73

Innovative entrepreneurs and their business firms that destroy existing business models are referred to as:

A)crowdfunders.
B)venture capitalists.
C)disruptors.
D)angel investors.

Question 74

Which of the following features of e-commerce technology changes industry structure by lowering barriers to entry but greatly expands the market at the same time?

A)global reach
B)richness
C)interactivity
D)personalization

Question 75

A ________ is a networked business ecosystem that coordinates a firm's suppliers, distributors, and delivery firms with its own production needs using an Internet-based supply chain management system.

A)value chain
B)value system
C)value web
D)business strategy

Question 76

A company's strong linkages with its customers increase switching costs.

Question 77

Which of the following may offer its customers value chain management software?

A)e-distributors
B)e-procurement companies
C)exchanges
D)community providers

Question 78

A strategy designed to compete within a narrow market or product segment is called a ________ strategy.

A)scope
B)differentiation
C)commoditization
D)focus

Question 79

Over the past decade, the number of exchanges has:

A)greatly increased.
B)diminished sharply.
C)stayed about the same.
D)increased slowly but steadily.

Question 80

SaaS and PaaS providers can typically provide services at lower costs through scale economies.