Deck 9: Online Retailing and Services

Question 1

The major impact of Internet real estate sites is in enabling online-only property transactions.

Answer 1

False

Question 2

Online career sites are being threatened by both job search engines and aggregators.

Answer 2

True

Question 3

Approximately two-thirds of U.S.Internet users use online banking.

Answer 3

True

Question 4

Consumers are primarily price-driven when shopping on the Internet.

Question 5

Within the United States retail market, personal consumption of ________ accounts for the largest share.

A)durable goods
B)general merchandise
C)online retail
D)food and beverage

Question 6

Online retailing is one of the largest segments of the retail industry.

Question 7

Online retailing provides an example of the powerful role that intermediaries continue to play in retail trade.

Question 8

In 2013, the number of online buyers was over 150 million.

Question 9

Contrary to predictions of analysts made during the early days of e-commerce, the Internet has led to both disintermediation and hypermediation on a widespread basis.

Question 10

The online mortgage industry has transformed the process of obtaining a mortgage.

Question 11

Comparison shopping sites drive approximately ________ % of e-commerce.

A)15
B)30
C)50
D)75

Question 12

Which of the following is not a major trend in online retail for 2013-2014?

A)Online retailing is the fastest growing retail channel.
B)Lunchtime purchases are the fastest growing time segment for online retail purchases.
C)Online retailers increase the use of interactive marketing tools such as blogs and user-generated content.
D)Social commerce almost doubles from $3 billion to $5 billion.

Question 13

The retail industry is the largest investor in information technology.

Question 14

Mobile commerce currently accounts for more retail goods sold than social commerce.

Question 15

Groupon is an example of local commerce.

Question 16

Eight of the top ten fastest-growing e-commerce merchants from 2003 to 2013 were:

A)virtual merchants.
B)bricks-and-clicks companies.
C)catalog merchants.
D)manufacturer-direct firms.

Question 17

Personal consumption of retail goods and services accounts for approximately ________ % of the United States GDP.

A)15
B)25
C)50
D)70

Question 18

The power of suppliers is a key industry strategic factor.

Question 19

Social network sites have become major locations from which consumers directly purchase products.

Question 20

In the United States, the service sector accounts for about 75% of all economic activity.

Question 21

Service industry groups are categorized generally into two groups, those that provide transaction brokering and those that involve:

A)retailing goods.
B)personalization.
C)information brokering.
D)providing hands-on services.

Question 22

Which of the following is not a key industry strategic factor?

A)synergies
B)barriers to entry
C)industry value chain
D)existence of substitute products

Question 23

In 2013, approximately what percentage of Internet users over the age of 14 made a purchase at an online retail store?

A)33%
B)53%
C)73%
D)93%

Question 24

All of the following statements about the MOTO sector are true except:

A)compared to general merchandisers, the transition to e-commerce has been easier for MOTO firms.
B)the MOTO sector is also referred to as the specialty store sector.
C)MOTO was the last technological revolution that preceded e-commerce.
D)distribution of catalogs is one of MOTO retailers' biggest expenses.

Question 25

The top 10 retailers account for about ________ % of all online retail.

A)30
B)50
C)70
D)90

Question 26

All of the following are strategic factors that pertain specifically to a firm and its related businesses except:

A)core competencies.
B)synergies.
C)technology.
D)power of customers.

Question 27

Which of the following is not one of the central challenges facing the online retail industry?

A)lack of physical store presence
B)consumer concerns about the privacy of personal information
C)inconvenience in returning goods
D)delivery delays

Question 28

The MOTO sector of the retail industry is most similar to the ________ sector.

A)specialty stores
B)general merchandise
C)online retail sales
D)consumer durables

Question 29

Which of the following is not categorized as an operating expense?

A)the cost of products being sold
B)marketing costs
C)administrative overhead
D)amortization of goodwill

Question 30

Operating margin is defined as:

A)operating income or loss divided by net sales revenues.
B)operating income or loss divided by total operating expenses.
C)net sales revenues divided by net income or loss.
D)net assets divided by net liabilities.

Question 31

Which of the following is not one of the seven major segments of the retail industry?

A)electronics and computers
B)specialty stores
C)gasoline and fuel
D)food and beverage

Question 32

Gross margin is defined as gross profit:

A)minus total operating expenses.
B)divided by net sales revenues.
C)divided by cost of sales.
D)minus net income.

Question 33

All of the following were parts of the vision during the early days of e-commerce except the belief that:

A)new, "first-mover" middlemen, with expertise in e-commerce, would force traditional intermediaries out of business.
B)Web consumers were rational and cost-driven.
C)entry costs to the online retail market would be much less than those needed to establish a physical storefront.
D)the cost of acquiring customers would be much lower.

Question 34

All of the following were factors that precipitated the growth of MOTO except:

A)the national toll-free call system.
B)the growth of the cellular phone industry.
C)falling long distance telecommunications prices.
D)the growth of the credit card industry.

Question 35

Which of the following is not one of the methods used by traditional retailers to develop multi-channel integration?

A)online Web catalog
B)online order, in-store pickup
C)online supply-push
D)online promotions for offline purchases

Question 36

In 2013, online retail revenues were approximately:

A)$2.6 billion.
B)$26 billion.
C)$260 billion.
D)$2.6 trillion.

Question 37

What is another name for pro forma earnings?

A)net margin
B)operating income
C)earnings before income taxes, depreciation, and amortization (EBITDA)
D)generally accepted accounting principles (GAA

Question 38

Which consumer review aggregator is facing charges that as many as 10 million of its reviews are faked?

A)Yelp
B)TripAdvisor
C)Angie's List
D)Porch

Question 39

The lower the cost of sales compared to ________, the higher the gross profit.

A)assets
B)revenue
C)gross margin
D)operating expenses

Question 40

All of the following are advantages of online retail except:

A)lower supply chain costs.
B)lower cost of distribution.
C)ability to change prices.
D)faster delivery of goods.

Question 41

All of the following statements about the online insurance industry are true except:

A)the Internet has dramatically changed the insurance industry's value chain.
B)Web sites of almost all the major firms provide the ability to obtain an online quote.
C)Internet usage has led to a decline in term life insurance prices industry-wide.
D)the industry has been very successful in attracting visitors searching for information.

Question 42

All of the following are challenges faced by bricks-and-clicks firms except:

A)coordinating prices across channels.
B)handling returns of Web purchases at retail outlets.
C)building a credible Web site.
D)building a brand name.

Question 43

For a quick check of a firm's short-term financial health, examine its:

A)working capital.
B)gross margin.
C)long-term debt.
D)cost of sales.

Question 44

Which of the following would not be considered a current asset?

A)long-term investments
B)cash
C)accounts receivable
D)marketable securities

Question 45

All of the following statements about the online real estate services market are true except:

A)the major impact of Internet real estate sites is in influencing offline decisions.
B)real estate differs from other types of online financial services because it is impossible to complete a property transaction online.
C)the primary service offered by real estate sites is a listing of houses available.
D)the Internet and e-commerce have created significant disintermediation in the real estate marketplace.

Question 46

All of the following are challenges for catalog merchants except:

A)high costs of printing and mailing.
B)building a credible Web site.
C)the need to bring staff in or manage new technology.
D)building sophisticated order entry and fulfillment systems.

Question 47

Virtual merchants face potentially large costs for all of the following except:

A)building and maintaining a Web site.
B)building and maintaining physical stores.
C)building an order fulfillment infrastructure.
D)developing a brand name.

Question 48

Which of the following has experienced the most significant online growth?

A)offline general merchandisers
B)virtual merchants
C)catalog merchants
D)manufacturer-direct firms

Question 49

In ________, all of a customer's financial (and even nonfinancial)data are pulled together at a single personalized Web site.

A)account aggregation
B)a financial portal
C)integrated financial services
D)EBPP systems

Question 50

Which of the following is not an example of a transaction broker?

A)a stockbroker
B)a real estate agent
C)an accountant
D)an employment agency

Question 51

All of the following statements about Amazon.com are true except:

A)Amazon has achieved success by focusing on its primary mission: selling books at highly competitive prices.
B)Amazon leases its own computing power to other companies.
C)eBay can be considered a competitor of Amazon's.
D)the Kindle is the best-selling product in Amazon's history.

Question 52

The term demand-pull refers to:

A)making products prior to orders being received based on estimated demand.
B)waiting for orders to be received before building a product.
C)channel conflict.
D)multi-channel manufacturers who sell directly online to consumers.

Question 53

The Internet has resulted in lower search costs, increased price comparison, and lower prices to consumers for which insurance product line?

A)term life insurance
B)automobile insurance
C)health insurance
D)property and casualty insurance

Question 54

Approximately ________ % of the United States labor force is involved in providing services.

A)50
B)65
C)75
D)85

Question 55

Which of these job recruitment sites is a job site aggregator?

A)SimplyHired
B)Craigslist
C)Monster
D)CareerBuilder

Question 56

Which of the following is not one of Amazon's primary business models?

A)transaction brokering
B)financial services provider
C)manufacturer-direct
D)content provider

Question 57

All of the following services require extensive personalization except:

A)financial services.
B)legal services.
C)medical services.
D)accounting services.

Question 58

All of the following are examples of the challenges that traditional manufacturers experience when using the Internet to sell directly to the consumer except:

A)moving to a demand-pull model.
B)high cost structures.
C)developing a fast-response online order and fulfillment system.
D)channel conflict.

Question 59

Which of the following statements about online banking is not true?

A)Top mobile banking activities include paying bills and depositing checks.
B)Online and mobile banking transactions incur radically lower transaction costs than in-person transactions.
C)Online banking is beginning to displace national banks.
D)Online banking is the primary banking channel for all ages.

Question 60

Current liabilities are debts of the firm that will be due within:

A)three months.
B)six months.
C)one year.
D)two years.

Question 61

A(n)________ is a single channel Web firm that generates almost all its revenues from online sales.

Question 62

The leading provider of account aggregation technology is ________.

Question 63

What is the largest sector of the online travel services market in terms of revenue?

A)hotel reservations
B)car reservations
C)cruise/tour reservations
D)airline reservations

Question 64

In a(n)________ model, products are made prior to orders received based on estimated demand.

Question 65

________ is the leading supplier of reservation, table management, and guest management software for restaurants.

Question 66

Craigslist is a player in which of the following online services market?

A)real estate services and career services
B)insurance services and brokerage services
C)travel services
D)online accounting services

Question 67

________ measures the percentage of sales revenue a firm is able to retain after all expenses are deducted from gross revenues.

Question 68

________ are sites that provide consumers with comparison shopping services, independent financial advice, and financial planning.

Question 69

Thus far, the most successful and innovative pure-play online retailer is ________.

Question 70

The four major sectors in the travel market are airline tickets, hotel reservations, cruises/tours, and ________.

Question 71

Which of the following is not a major trend in the online recruitment services industry?

A)disintermediation
B)localization
C)social networking
D)consolidation

Question 72

Which of the following statements is not true?

A)Price competition among online travel services is difficult as comparison shopping for better prices is easy.
B)Online travel services is one of the few sectors in which extensive disintermediation has occurred.
C)The ability of travel products and services to be commoditized is a significant factor in the explosive growth of the online travel services industry.
D)The online travel services industry has gone through a period of consolidation.

Question 73

Which of the following best explains why the service sector is a natural avenue for e-commerce?

A)The service sector is less geographically reliant and more globally oriented.
B)The service sector has historically been more technology-reliant.
C)Much of the value in services is based on the collection, storage, and exchange of information.
D)It is not; services are difficult to translate to e-commerce because they rely on face-to-face communication and barter.

Question 74

If a firm's ________ is only marginally positive, or negative, the firm will likely have trouble meeting its short-term obligations.

Question 75

________ occurs when retailers of products must compete on price and currency of inventory directly against the manufacturer.

Question 76

The four main online retail business models are virtual merchants, multi-channel merchants, manufacturer-direct firms, and ________ merchants.

Question 77

________ refers to the ability of firms to survive as profitable business firms during the specified period.

Question 78

A(n)________ provides a financial snapshot of a company's assets and liabilities (debts)on a given date.

Question 79

________ provide integrated airline, hotel, conference center, and auto rental services at a single Web site.

Question 80

In a(n)________ strategy, traditional merchants combine their offline retail and online retail stores and services to provide a seamless customer experience.