Deck 9: Online Retail and Services

Question 1

All of the following have launched trials of Buy buttons except:

A)Facebook.
B)Pinterest.
C)Instagram.
D)Tumblr.

Answer 1

D

Question 2

Personal consumption of retail goods and services accounts for over 75% of total gross domestic product.

Answer 2

False

Question 3

The MOTO sector of the retail industry is most like the ________ sector.

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

Answer 3

C

Question 4

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 5

Which of the following categories generates the highest percentage of online retail revenue?

A)computers and electronics
B)apparel and accessories.
C)books/music/video
D)automobile and automobile parts and accessories

Question 6

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

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

Question 7

In 2016,approximately what percentage of Internet users over the age of 14 made a purchase at an online retail store?

A)37%
B)57%
C)77%
D)97%

Question 8

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 9

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 10

Which of the following statements is not true about the automobile and automobile parts and accessories online retail category?

A)Most of the revenue in this category is generated from the sales of automobiles.
B)Automobile manufacturers use the Internet to deliver branding advertising.
C)U.S.franchising law prohibits automobile manufacturers from selling cars directly to consumers.
D)Automobile retailing is dominated by dealership networks.

Question 11

Which of the following is not a major trend in online retail for 2016-2017?

A)Online retail remains the fastest growing retail channel.
B)The average annual purchase of online buyers continues to increase.
C)Online retailers place an increased emphasis on providing an improved "shopping experience".
D)The number of online buyers begins to plateau.

Question 12

Which of the following had the highest online sales revenue in 2015?

A)Macy's
B)Walmart
C)Sears
D)Target

Question 13

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)online 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 14

Approximately ________ retailers generate 90% of all retail e-commerce sales.

A)10
B)100
C)1,000
D)10,000

Question 15

Online retail constitutes about 20% of the total retail market today.

Question 16

In 2016,the number of online buyers was over 175 million.

Question 17

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 18

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 19

About 90% of Internet users in the United States are now online buyers.

Question 20

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 21

The existence of substitute products is a key industry strategic factor.

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

Which of the following provides a financial snapshot of a company's assets and liabilities (debts)on a given date?

A)working capital
B)operating margin
C)balance sheet
D)gross margin

Question 24

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 25

Describe the vision of online retailing during the early days of e-commerce.Did these predictions and assumptions turn out to be true?

Question 26

What are the challenges faced by automobile manufacturers in selling online?

Question 27

________________ measures the percentage of sales revenue a firm retains after all expenses are deducted from gross revenues.

A)Gross profit
B)Net margin
C)Operating margin
D)Working capital

Question 28

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 29

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

Question 30

Describe the state of the online retail sector today.

Question 31

The lower the ____________ compared to revenue,the higher the gross profit.

A)assets
B)cost of sales
C)gross margin
D)operating expenses

Question 32

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 33

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 34

Naturebox is an example of a subscription-based retail revenue model.

Question 35

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 36

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 37

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

Question 38

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 39

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

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

Question 40

Big data plays an important role in predictive marketing.

Question 41

Discuss Amazon's future prospects.Do you think Amazon will ever be consistently profitable?

Question 42

In the United States,the service sector accounts for approximately ________ % of the United States GDP.

A)70
B)75
C)80
D)85

Question 43

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

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

Question 44

Which of the following has the second-highest share of online retail sales?

A)omni-channel merchants
B)virtual merchants
C)catalog merchants
D)manufacturer-direct

Question 45

Why have so many online retailers had difficulty in achieving profits? How has this changed by 2016?

Question 46

Describe the virtual merchant business model and its unique challenges in becoming financially viable.

Question 47

Which of the following is not an example of a virtual merchant?

A)Overstock
B)Wayfair
C)Rue La La
D)Dell

Question 48

All of the following statements about Amazon are true except:

A)Amazon failed to show a profit in 2015.
B)Amazon Web Services is now a major part of Amazon's business.
C)eBay can be considered a competitor of Amazon's.
D)Amazon continues to generate revenue primarily by selling products.

Question 49

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)hands-on services.

Question 50

The term supply-push 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 51

Which of the following is a subscription-based retailer using predictive marketing and Big Data?

A)Macy's
B)Birchbox
C)Dell
D)Lands' End

Question 52

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 53

All of the following are challenges for catalog merchants except:

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

Question 54

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

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

Question 55

Which of the following has the highest share of online retail sales?

A)omni-channel merchants
B)virtual merchants
C)catalog merchants
D)manufacturer-direct

Question 56

Omni-channel merchants are also referred to as:

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

Question 57

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

A)50
B)60
C)70
D)80

Question 58

Which of the following occurs when retailers of products must compete on price and currency of inventory directly against the manufacturer?

A)disintermediation
B)localization
C)channel conflict
D)hypermediation

Question 59

Define the term economic viability and explain the factors involved in assessing a firm's economic viability.

Question 60

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 61

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

A)most people use the Internet to search for a home,but still use the services of a real estate agent to complete the purchase.
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 62

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)websites 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 63

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 are 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 64

Discuss the issue of consolidation in the online travel services industry.

Question 65

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 66

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

Question 67

Which of the following has introduced a tool known as Consumer Alerts to inform readers when a review is likely to be fraudulent?

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

Question 68

More than 50% of the adult U.S.population use online banking.

Question 69

Almost all recruiting professionals now use social networks in the recruiting process.

Question 70

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 71

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

A)Top mobile banking activities include checking balances and bank statements and viewing recent transactions.
B)Online and mobile banking transactions provide significant costs savings for banks.
C)Millennials are adopting mobile banking at a much higher rate than those who are older.
D)More people use a tablet for mobile banking than a mobile phone.

Question 72

Expedia owns all of the following except:

A)Travelocity.
B)Orbitz.
C)TripAdvisor.
D)CheapTickets.

Question 73

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 74

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

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

Question 75

The major impact of Internet real estate sites is in influencing offline decisions.

Question 76

All of the following services require extensive personalization except:

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

Question 77

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

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

Question 78

Identify and discuss the key features of the online insurance industry.

Question 79

Which of these job recruitment sites is not a job listing aggregator?

A)Indeed
B)SimplyHired
C)Glassdoor
D)CareerBuilder

Question 80

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

A)disintermediation
B)Millennials and GenX primarily use mobile devices to search for jobs
C)social recruiting
D)hiring by algorithm