Deck 9: E-Commerce and the Entrepreneur

Question 1

Before a Web site can become the foundation for a successful e-business:

A) the technology must be right.
B) it should be previewed by a Web designer.
C) it must be created with the target audience in mind.
D) the physical storefront must be established.

Answer 1

C

Question 2

The Web is one of the most efficient ways of reaching both new and existing customers and when properly promoted, a Web site can:

A) reduce a company's cost of generating sales leads.
B) be an affordable way to reach customers beyond your geographic area.
C) provide an efficient method to provide information about a company and their products.
D) All of the above

Answer 2

D

Question 3

________ monitor customers' behavior while they are on a site, giving Web-based businesses the information they need to make their Web sites and their online ________ efforts more effective.

A) Wikis; social marketing
B) Tracking tools; marketing
C) Tracking tools; security
D) Tracking tools; listings

Answer 3

B

Question 4

Entrepreneurs should make sure they do not fall victim to any of the e-commerce myths. Which of the following is not an e-commerce myth?

A) Setting up a business on the Web is easy and inexpensive.
B) If I launch a site, customers will flock to it.
C) Making money on the Web is easy.
D) Privacy and site security is an important issue on the Web.

Question 5

One of the most valuable attributes of the Web is the ability to:

A) provide companies with instantaneous customer feedback.
B) enable the site to create an appearance that the organization is able to meet customer needs that, in fact, are not possible based on its actual resources.
C) eliminate advertising expenses and the amount of printed materials needed to facilitate promotional efforts.
D) encourage the use of credit cards as a means of paying for the online transaction.

Question 6

Which of the following is an important issue that business owners should consider before launching an e-commerce effort?

A) How to develop long-term relationships with customers
B) How to exploit the interconnectivity and the opportunities it creates to transform relationships with its suppliers, customers, and external stakeholders
C) How to measure the success of its Web-based sales effort
D) All of the above

Question 7

To avoid unpleasant surprises in launching an e-commerce effort an entrepreneur should:

A) test the Web site with real customers to make sure it is easy to navigate.
B) avoid being talked into establishing a privacy policy.
C) cancel all current advertisements in other media.
D) not try to out-guess customers, and handle order fulfillment as orders come in.

Question 8

Building a Web strategy based on a clear definition of the company's target audience and an understanding of those customers' needs, wants, likes, and dislikes is:

A) relatively unimportant for a company's Web site due to its flexibility.
B) something that the entrepreneur no longer has to focus on to realize success.
C) also critically important for a company's presence on the Web.
D) an exercise that should eventually be addressed after the site is launched.

Question 9

Which of the following is not a common reason customers leave Web sites before checking out?

A) Total shipping charges were too high.
B) The privacy policy was not posted.
C) The shopping cart was too hard to find.
D) The site did not appear trustworthy.

Question 10

Experts estimate that nearly ________ of the world's online population has used the Internet to make a purchase.

A) 46 percent
B) 66 percent
C) 84 percent
D) 96 percent

Question 11

The entrepreneurs who are proving to be the most successful in e-commerce are those who know how:

A) their industries work, inside and out.
B) technology works, inside and out.
C) to turn a profit.
D) to effectively finance their e-commerce effort.

Question 12

Successful e-tailers have discovered that these factors enhance their reputations for online customer service:

A) comprehensive FAQ pages and e-mail order confirmation with shipment notices.
B) visible telephone and e-mail contact information.
C) quick responses to questions with meaningful information.
D) All of these factors enhance a Web-based reputation.

Question 13

An estimated ________ percent of small business owners in the U.S. have Web sites.

A) 25 percent
B) 64 percent
C) 75 percent
D) 85 percent

Question 14

An important part of any e-commerce effort is:

A) the use of current technology and its successful implementation.
B) the ability to understand the underlying business and to develop a workable business model.
C) to have a site that is fast and dependable.
D) to have high traffic to the site, regardless of the customers' interest in what the site actually offers.

Question 15

The Internet penetration rate is greatest in North America with 78.3% and the second region of the world in penetration is:

A) Oceania/Australia.
B) Europe.
C) Latin America/Caribbean.
D) Middle East.

Question 16

The most common reasons for leaving a site without purchasing include which of the following?

A) Shipping charges were too high.
B) Site did not look trustworthy.
C) Customers could not find the items they were looking for.
D) All of the above

Question 17

All of the following represent benefits of selling on the Web except:

A) opportunity to increase revenues.
B) power to educate and inform.
C) ability to remain open 24 hours a day.
D) ability to advertise in a cheaper media form.

Question 18

To be successful online, small companies must create Web sites with features that appeal to experienced Web shoppers, such as:

A) simple navigation and customer reviews.
B) solid security and quick access to product information.
C) videos and blogs.
D) The successful Web site will include all the above.

Question 19

The intentional and targeted promotion of a Web site is:

A) critical to online success.
B) optional because once you are on the Web, you will get traffic and sales.
C) a luxury that most small businesses can not afford.
D) contrary to current Web trends.

Question 20

A study by the Pew Internet and American Life Project reports that ________ percent of Americans research products and services online before buying them, an increase of ________ percent in the year 2000.

A) 40; 15
B) 40; 35
C) 60 ;15
D) 60; 35

Question 21

Rather than trying to compete head to head with the dominant players on the Web with greater access to resources, entrepreneurs should consider focusing on:

A) serving a market niche.
B) serving a geographic niche.
C) only brick-and-mortar retail channels.
D) building a Web site in-house.

Question 22

Examples of Web 2.0 tools include:

A) mashups and podcasts.
B) social networking and RSS feeds.
C) wikis and blogs.
D) All the above

Question 23

Approximately ________ of Web users speak English.

A) 38 percent
B) 27 percent
C) 37 percent
D) 29 percent

Question 24

According to Gerry Goldsholle, founder of two Web sites aimed at small companies, he suggests to "________" when you first launch your Web site.

A) Make sure it is perfect
B) Try it, learn from it, and fix it
C) Work to get all the information
D) Create your copy and don't worry about visuals

Question 25

The single most common reason for abandoning online shopping carts is:

A) shipping and handling charges were too high.
B) delivery times were too long and the checkout process required too much information and time.
C) there was insufficient product information available.
D) the inability to compare the final price before buying.

Question 26

The ________ while downloading a Web page is one of the most important determinants of its sales effectiveness.

A) visual stimuli
B) "flash and show"
C) memory required
D) time required

Question 27

Visitors begin to evaluate the credibility of a Web site as soon as they arrive. Which of the following does not help develop a site's credibility?

A) Posting a privacy policy
B) Citing reference sources
C) Presenting fair and objective information
D) Avoiding the promotion of brand names

Question 28

For entrepreneurial companies that lack brand and name recognition, and if building name recognition is one of the keys to success on the Web, one effective and affordable option may be to:

A) invest more in online promotion.
B) rely on viral marketing.
C) develop better brand recognition.
D) form strategic alliances with larger companies that can add credibility.

Question 29

Strategies for successful e-commerce efforts should include all of the following except:

A) focusing on a niche market.
B) developing a community of customers.
C) attracting visitors by giving away "freebies."
D) adding value to recipients by sending spam e-mail.

Question 30

The most significant ways online companies can bolster customer service include all of the following except:

A) create a well-staffed and well-trained customer response team.
B) offer a simple return policy.
C) provide an easy order tracking process.
D) make financing available.

Question 31

One common mechanism to attract international visitors is to include several:

A) alternative forms of payment options.
B) language buttons.
C) images reflecting multiple cultures.
D) colors and symbols reflective of international cultures.

Question 32

Some companies use ________ to encourage customers to participate in the design of their products, a process called ________ .

A) wikis; co-creation
B) wikis; collaboration
C) widgets; co-creation
D) mashups; co-creation

Question 33

Businesses selling less well-known brands should:

A) reduce prices.
B) offer freebies.
C) use customer testimonials and endorsements.
D) All of the above

Question 34

Although e-commerce can lower many costs of doing business, it still requires:

A) a professional Web designer's input.
B) a basic infrastructure in the distribution channel to process orders, maintain inventory, fill orders, and handle customer service.
C) a brick-and-mortar store presence.
D) None of the above

Question 35

Customers will typically welcome well-constructed permission e-mail that directs them to company sites for information or special deals, unlike unsolicited and universally despised e-mail known as:

A) spam.
B) electronic flyers.
C) voice mail.
D) clipboards.

Question 36

The amount of time the average person spends online is ________ than he or she spends watching television.

A) less
B) about the same
C) almost one-half
D) more

Question 37

An estimated ________ percent of adults participate in social networks and the highest level of participation is social media is among adults ________ years of age.

A) 65; over 30
B) 65; under 30
C) 55; over 30
D) 55; under 30

Question 38

There is plenty of room for improvement in customer service on the Web. Research by Harris Interactive reports that more than ________ of online shippers said that they expect higher levels of customer service than they do in offline, traditional stores. .

A) 2 percent
B) 12 percent
C) 22 percent
D) 52 percent

Question 39

Many Web sites seek to create, develop, and facilitate a:

A) technology that is fast and complex.
B) site that appeals to a broad range of diverse visitors.
C) community of customers with similar interests.
D) site that provides a variety of information that most anyone can find useful.

Question 40

A Web site or an application that combines content from multiple sources is a:

A) mashup.
B) Really Simple Syndication (RSS)
C) wiki.
D) widget.

Question 41

Popular social media tools for small businesses include:

A) social networking.
B) online videos.
C) Webcasts.
D) All the above

Question 42

The percentage of shoppers who place at least one item in a shopping cart but never complete the transaction is called the:

A) bounce rate.
B) cart abandonment rate.
C) conversion rate.
D) cost per acquisition.

Question 43

An effective search engine optimization (SEO) strategy can be maintained through:

A) natural, or organic, listings.
B) paid or sponsored listings.
C) paid inclusions.
D) All of the above

Question 44

One of the most valuable benefits of giving customers a reason to return to your site is that it can be an effective tool to:

A) deter competitive action.
B) increase traffic.
C) build customer loyalty.
D) establish online habits.

Question 45

Perhaps the best domain name is one that:

A) customers can easily guess if they know the company's name.
B) is complex to stop competitors from copying it.
C) sounds very much like a larger competitor's name.
D) does not use the company's initials.

Question 46

Tools that measure a Web site's ability to attract customers, generate sales, and keep customers coming back are:

A) Web analytics.
B) recency.
C) cost per acquisition tools.
D) conversion tools.

Question 47

A situation that occurs when a company pays for clicks that are generated by someone with no interest in or intent to purchase its products or services is called:

A) paid inclusion.
B) unpaid inclusion.
C) click fraud.
D) an unnatural listing.

Question 48

Responsible online merchants should make sure shipping and handling charges are:

A) reasonable.
B) displayed early in the buying process.
C) easy to find.
D) All of the above

Question 49

A company that pays a search engine for the right to submit either selected pages or the entire content of the Web site is referred to as:

A) click fraud.
B) web analytics.
C) paid or sponsored listings.
D) Really Simple Syndication (RSS).

Question 50

The number of visitors to a company's Web site who view a single page and leave without viewing other pages is referred to as the:

A) stickiness of the site.
B) click-stream.
C) conversion ratio.
D) bounce rate.

Question 51

Search engine listings that are the result of "spiders," powerful programs that crawl around the Web and analyze sites for keywords links, and other data are :

A) wikis, or Web 2.0 listings.
B) widgets, or organic listings.
C) mashups, or natural listings.
D) natural, or organic listings.

Question 52

A successful Web site should include all of the following characteristics except:

A) a FAQ section.
B) continuous automated music that cannot be cut off.
C) updated and timely information.
D) readable font sizes.

Question 53

A measurement of the cost a company incurs to generate each purchase or customer registration is the:

A) cost per acquisition, or CPA.
B) bounce rate.
C) conversion ratio.
D) browser-to-buy ratio.

Question 54

The purchase funnel identifies ways to improve the online shopping experience. The process begins with ________ and ends with ________ .

A) promoting an online presence; a streamlined checkout process
B) making the site easy to find; a streamlined checkout process
C) promoting the URL; a purchase
D) creating customer confidence; the payment process

Question 55

The pages on which visitors land after they click on a sponsored link in a search engine, e-mail ad, or online ad are referred to as:

A) landing pages.
B) the home page.
C) the transition page.
D) the search page.

Question 56

The ideal domain name should be:

A) short.
B) memorable.
C) easy to spell.
D) All of the above

Question 57

All of the following are effective ways to encourage customers to return to a site except:

A) offer "frequent buyer" programs.
B) clearly state prices and shipping charges.
C) advertise with "pop-ups."
D) provide a search function.

Question 58

To launch a successful Web site, business owners should consider:

A) a simple design that is easy to navigate.
B) that in order to stand out on the Web, the a site really has to sparkle.
C) all the "bells" and "whistles" technology can provide.
D) that flash makes a Web site better.

Question 59

When creating a Web site, the goal is to create a design:

A) in which customers "see themselves" when they visit.
B) that is flashy.
C) in which customers cannot relate.
D) that is inclusive of everyone in most every situation.

Question 60

The ________ is the percentage of visitors to the site who actually make a purchase and the average is about ________ percent

A) conversion rate; 1.2
B) bounce back rate: 3.2
C) conversion rate; 3.2
D) cost per acquisition; 3.2

Question 61

A combination of hardware and software that allows employees to have access to the Internet but keeps unauthorized users from entering the company's network is called:

A) virus detection software.
B) intrusion detection software.
C) a firewall.
D) Web protection.

Question 62

For many entrepreneurs, the key barrier to not using the Web as a business tool is that they do not see any benefits to selling online.

Question 63

A valuable method of preventing online fraud is to:

A) ask customers for their card verification value.
B) not accept credit cards.
C) run background checks on customers.
D) All of the above

Question 64

Experienced online shoppers tend to be unforgiving, quickly clicking to another site if their shopping experience is unsatisfactory or they are unable to find the products and information they want.

Question 65

Virtual shop owners using banner ads have no reason to buy ads in traditional advertising media.

Question 66

Web sites have two conflicting goals regarding security. The first is to establish a presence on the Web so that customers from across the globe can have access to its site, and the second goal is to:

A) maintain a database system of customer information and preferences.
B) have a system in place to prosecute hackers.
C) maintain a high level of security so that the business, its site, and the information it collects are safe from hackers and intruders intent on doing harm.
D) develop an in-house payment processing system.

Question 67

Measuring the success of its Internet-based sales effort is essential if a company is to remain relevant to customers whose tastes, need, and preferences are always changing.

Question 68

Research indicates that younger audiences do not take the time to seek product information before they make a purchase.

Question 69

The Web is one of the most efficient ways of reaching both new and existing customers.

Question 70

A study by the Pew Internet and American Life Project reports that 58 percent of Americans research products and services online before buying them, an increase of 35 percent from the year 2000.

Question 71

The Web typically lacks the ability to lower the cost of doing business.

Question 72

Measuring the success of its Web-based sales is not essential because customer tastes and preferences are always changing.

Question 73

To minimize the likelihood of invasion by hackers, e-commerce companies rely on several tools, including:

A) virus detection software.
B) intrusion detection software.
C) firewalls.
D) All of the above

Question 74

More than 75 percent of small business owners who have Web sites engage in e-commerce.

Question 75

The most common problem is the online transactions that customers dispute, referred to as:

A) acts of fraud.
B) chargebacks.
C) torts.
D) recency.

Question 76

Companies quickly learn that setting up a Web site is only the first investment required. The site leads to an ongoing investment of resources -- time, money, energy and talent.

Question 77

Online sales and Internet activity will account for more than 50 percent of total retail sales.

Question 78

E-commerce is replacing traditional retailing.

Question 79

Listing a site with a popular Web search engine will guarantee that surfing customers will find your site.

Question 80

The security software that can trace a hacker's location is identified by which of the following?

A) Virus detection software
B) Intrusion detection software
C) A firewall
D) A viral site