Question 1

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.

Accepted Answer

The statement suggests that Ryan is likely to make an impulse buy and not research the different brands, which goes against his behavior of researching and being familiar with the attributes of a smart T.V. purchase.

Question 2

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

Accepted Answer

The answer of Consumers are less likely to use a...

Question 3

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

Accepted Answer

Prior knowledge often reduces the amount of information search a consumer will engage in because they already have information relevant to the decision-making process.

Question 4

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

Accepted Answer

In online environments, consumers can easily and quickly search for products using search engines or filters, whereas in offline environments, consumers may need to physically search for products on shelves or ask staff for assistance.

Question 5

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

Accepted Answer

Compensatory strategies allow consumers to weigh the pros and cons of various options, taking into account both positive and negative attributes. Non-compensatory strategies, on the other hand, involve setting a cutoff point or relying on one particular attribute to make a decision, which can lead to oversimplification and potentially poorer choices.

Question 6

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.

Accepted Answer

The answer of A comparison matrix is a reporting aid...

Question 7

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

Accepted Answer

When a person perceives a higher level of risk in a purchase decision, they tend to be more involved in the decision-making process. This is because they want to gather more information and carefully consider their options in order to minimize any potential negative outcomes. Therefore, involvement and risk are often positively correlated in purchasing decisions.

Question 8

As easy of comparison shopping increases, cost transparency decreases.

Accepted Answer

As the ease of comparison shopping increases, cost transparency typically increases because consumers can more easily compare prices and understand the cost differences between products or services.

Question 9

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

Accepted Answer

Relationship marketing programs focus on building long-term relationships with customers by understanding their individual needs and preferences. This leads to more one-to-one marketing, where companies tailor their approach and offerings to each customer in personalized transactions.

Question 10

Cost transparency can actually lower brand loyalty.

Accepted Answer

Cost transparency can increase price sensitivity and lead to consumers being more likely to switch to a competitor offering a lower price. Therefore, it can reduce brand loyalty.

Question 11

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.

Accepted Answer

Glen Urban suggests that firms should focus on building trust and relationships with consumers rather than just persuading them, as consumer power has increased with the Internet.

Question 12

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

Accepted Answer

The online and offline efforts of a brand work together and complement each other, creating a symbiotic relationship. Online efforts can drive offline purchases, and offline experiences can further enhance online engagement.

Question 13

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

Accepted Answer

The answer of Research shows that price sensitivity is higher...

Question 14

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.

Accepted Answer

This statement is true. Recommendation agents use personal preferences or purchase histories to suggest options and help eliminate choices for consumers.

Question 15

"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.

Accepted Answer

The statement indicates that Red Hawk Clothing intends to build trust and a long lasting relationship with customers and profit through return shoppers and strong branding, which aligns with a long-term approach to business and consumer advocacy.

Question 16

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.

Accepted Answer

Having a physical presence can increase brand recognition and trust, which may lead to increased online sales. Additionally, customers who see the clothes in person may be more likely to make a purchase, even if they ultimately buy online.

Question 17

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

Accepted Answer

Relationship marketing focuses on creating long-term relationships with customers through personalized interactions and customer engagement, rather than relying solely on consumer reports and advertising.

Question 18

Consumers generally trust large corporations.

Accepted Answer

According to various surveys and studies, trust in large corporations has decreased in recent years due to issues such as scandals, unethical behavior, and lack of transparency.

Question 19

Consumer advocacy programs can benefit all companies.

Accepted Answer

Consumer advocacy programs primarily benefit companies with a strong customer focus and positive reputation, as they rely on satisfied customers to promote the brand. Companies with poor customer service or products may not benefit.

Question 20

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.

Accepted Answer

By making options negatively correlated, consumers are forced to make trade-offs and prioritize certain attributes over others, which can lead to more thoughtful and considered purchases. This can ultimately result in greater satisfaction with the chosen product.

Quiz 15: Consumer Behavior Online