Deck 9: Online Retailing and Services

Question 1

Omni-channel merchants are also referred to as:

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

Answer 1

B

Question 2

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

Answer 2

False

Question 3

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

A) 10
B) 30
C) 50
D) 80

Answer 3

D

Question 4

Online retail constitutes about 6% of the total retail market today.

Question 5

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 6

Sharing economy fees collect a fee from both sellers and buyers who use the platform.

Question 7

LivingSocial is an example of local commerce.

Question 8

Almost all recruiting professionals now use social networks to find new employees.

Question 9

EC2 is an example of cloud computing.

Question 10

Online banking has become the primary banking channel for all age groups.

Question 11

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 12

In 2014, the number of online buyers was over 200 million.

Question 13

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

Question 14

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

Question 15

Which of the following is not a major trend in online retail for 2014-2015?

A) About 90% of Internet users in the United States are now online shoppers.
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) Virtual merchants using a subscription-based revenue model emerge.

Question 16

Online retailing is the fastest growing retail channel.

Question 17

Big Data plays an important role in predictive marketing.

Question 18

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

Question 19

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 20

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

Question 21

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 22

Which of the following launched trials of Buy buttons in 2014?

A) Facebook and Pinterest
B) Twitter and Pinterest
C) Twitter and Facebook
D) Pinterest and Tumblr

Question 23

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 24

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 25

In 2014, approximately what percentage of Internet users over the age of 14 made a purchase at an online retail store?

A) 35%
B) 55%
C) 75%
D) 95%

Question 26

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 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

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 29

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 (GAAP) earnings

Question 30

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

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

Question 31

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 32

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 33

All of the following are examples of Amazon Web Services except:

A) Amazon Prime.
B) Amazon S3.
C) Amazon EC2.
D) Amazon Glacier.

Question 34

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 35

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 36

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

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

Question 37

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 38

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 39

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 40

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 41

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

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

Question 42

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 43

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 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

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

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

Question 46

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 47

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 48

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 49

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 50

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 51

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 52

All of the following services require extensive personalization except:

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

Question 53

All of the following statements about Amazon are True except:

A) Amazon did not show a profit in 2013.
B) Amazon is at the forefront of the "infrastructure as a service" market.
C) eBay can be considered a competitor of Amazon's.
D) Amazon continues to generate revenue primarily by selling products.

Question 54

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 55

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

A) Top mobile banking activities include checking balances and transferring money from one account to another.
B) Online and mobile banking transactions provide significant costs savings for banks.
C) All of the purely online banks (those that operate without a network of branches) have gone out of business.
D) Over 50% of the adult U.S. population used online banking in 2014.

Question 56

Which of the following is not True about sharing economy firms?

A) Their growth is supported by the use of online reputation systems based on peer review.
B) Sharing economy firms that choose a marketplace that is too small to generate sufficient and steady demand are likely to fail.
C) Sharing economy firms facilitate access to resources.
D) Sharing economy firms are a totally new phenomenon without precedent in the history of e-commerce.

Question 57

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

A) Zillow and Trulia together account for over 60% of Web and mobile traffic to online real estate sites.
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 58

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 59

Which of the following is a sharing economy company focused on the rental of lodging?

A) Uber
B) Lyft
C) Airbnb
D) Task Rabbit

Question 60

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 61

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 62

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

Question 63

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 64

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

Question 65

In a(n) ________ model, products are not built until an order is received.

Question 66

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

Question 67

________ is the largest online travel service.

Question 68

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

Question 69

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

Question 70

________ retailers are firms that sell products through a variety of channels and integrate their physical stores with their Web sites and mobile platform.

Question 71

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

Question 72

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 73

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

Question 74

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 75

________ is a sharing economy company is said to be the fasted expanding e-commerce company in history.

Question 76

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

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

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

Question 79

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

Question 80

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