Deck 6: Web, nonstore-Based, and Other Forms of Nontraditional Retailing

Question 1

Which of the following is a not a disadvantage to a catalog-based direct marketer?

A) the inability to pinpoint specific customer segments through mailing lists
B) the effect of increases in postal rates and paper stock costs on profits
C) high clutter due to the large number of catalogs that are mailed
D) the inability to revise prices when catalogs are prepared months in advance of distribution

Answer 1

A

Question 2

The "30-day rule" requires direct marketers to ________.

A) ship orders within 30 days of receipt or notify customers of delays
B) have 30 days worth of inventory on hand based on normal sales rates
C) notify consumers of any delay by mail, phone, fax, or computer
D) cancel orders if they cannot be shipped within 30 days of receipt

Answer 2

A

Question 3

A customer orders products by mail,phone,fax,tablet,or computer in ________.

A) services retailing
B) direct marketing
C) direct selling
D) retail catalog showrooms

Answer 3

B

Question 4

While an infomercial may be 30 minutes in length,it commonly has timed segments since ________.

A) the advertiser wants to better distribute ordering times
B) the advertiser can change the advertised product if the response is low
C) media rates are reduced
D) most viewers watch only a few minutes at a time

Question 5

Direct marketing is forecast to grow based on ________.

A) greater product standardization and the prominence of well-known brands
B) the growth of private label brands
C) direct marketing clutter
D) reduced postal rates and paper stock costs

Question 6

The high level of competition in direct marketing is due to ________.

A) high control over postal rates and paper costs
B) high profitability of existing direct marketers
C) low technological requirements for Web access
D) ease of entry into direct marketing

Question 7

Direct marketers are most affected by which federal legislation?

A) Robinson-Patman Act
B) 30-day rule
C) Green River ordinances
D) Blue laws

Question 8

Direct marketers are typically divided into two broad categories: ________ and ________.

A) single channel; dual channel
B) static; interactive
C) mail; phone
D) general; specialty

Question 9

The promotional strategy of shopping networks ________.

A) enables purchases to be made only while an item is being advertised
B) relies heavily on cooperative advertising allowances
C) uses fringe times on cable television
D) stresses the use of infomercials

Question 10

Multichannel and omnichannel channel retailing both engage in ________.

A) nonstore retailing
B) store-based retailing
C) vertically integrated marketing
D) channel control retailing

Question 11

A way to collect,store,and use relevant information about customers is ________.

A) marketing information systems
B) database retailing
C) marketing research
D) one-on-one research

Question 12

Infomercials are generally broadcast ________.

A) at peak hours on broadcast television
B) continuously on broadcast television
C) continuously on cable television
D) at fringe times

Question 13

Direct marketing is increasingly used by store-based retailers since it ________.

A) increases sales to the store's current target market
B) is an inexpensive way to reach a broad geographic base
C) appeals primarily to male shoppers
D) enables the retailer to offer distinctive merchandise to small market segments

Question 14

A retailer keeps an updated record of its customers' purchases,method of payment,and size and color preferences.This illustrates ________.

A) the 80-20 principle
B) database retailing
C) direct marketing
D) Web retailing

Question 15

Direct marketing is increasingly used by store-based retailers.This illustrates ________.

A) multichannel retailing
B) downsizing
C) diversification
D) vertical integration

Question 16

Conventional vending machines are generally not considered as a form of direct marketing since ________.

A) most transactions involve beverages, food items, and cigarettes
B) consumers do not complete transactions via mail, phone, fax, or computer
C) the transaction is automated
D) no credit or checks are involved as part of the transaction

Question 17

Unlike traditional marketers,the profitability of direct marketers is highly sensitive to which types of expenses?

A) rental costs
B) postage and paper stock costs
C) energy costs
D) fringe benefit expenses

Question 18

The most sophisticated form of retailing that offers a consistent,uninterrupted,and seamless experience regardless of channel or device is ________.

A) single-channel retailing
B) multichannel retailing
C) dual marketing
D) omnichannel retailing

Question 19

Which of these is not a strategic business advantage of direct marketing?

A) Products can be examined prior to purchase.
B) Reduced inventories can be held.
C) A very large geographic area can be efficiently covered.
D) Customers encounter no crowds or parking congestion.

Question 20

A direct marketer can economically appeal to the needs of a particular customer segment through ________.

A) regional editions of catalogs
B) infomercials
C) specialogs
D) micro-merchandising

Question 21

Which statement concerning the World Wide Web and the Internet is not correct?

A) The World Wide Web is one way of accessing the Internet.
B) The World Wide Web accounts for five percent of overall U.S. retail sales.
C) The World Wide Web has graphics, sound, video, and audio capability.
D) Almost all online interactive retailing is conducted on the World Wide Web.

Question 22

A major advantage of the use of airport retailing by a retailer is ________.

A) tighter security at airports
B) access to a captive audience
C) interest in duty-free shopping by domestic travelers
D) availability of larger stores

Question 23

Which statement concerning vending machines is not correct?

A) Newspapers and cigarettes account for a high percent of vending machine sales.
B) Well-known brands and standardized nonfood items are best suited for vending machine sales.
C) Eighty-five percent of vending machine sales involve hot and cold beverages and food items.
D) Most vending machines still do not have dollar bill changers.

Question 24

Which of the following is a negative feature for retailers of the World Wide Web?

A) the small size of the potential audience
B) the poor demographics of World Wide Web users
C) low degree of interactivity between users and retailer sponsor
D) credit card security issues reducing consumer purchasing

Question 25

In general,which of the following would have the highest response rate to a direct marketer's promotion?

A) a mailing of a general clothing catalog featuring sales merchandise
B) a mailing of a special magazine subscription offer which includes a sweepstakes offer
C) a mailing to past purchasers of a collectible doll for the third doll in a series
D) a mailing based on a rented list

Question 26

Which statement concerning the characteristics of World Wide Web users is not correct?

A) Females shop on the Web more often than males.
B) Consumers with high levels of education use the Web more often than lower-educated consumers.
C) Adults over 60 use the Web most often.
D) Web users use the Web for information, entertainment, and interactive communications.

Question 27

A freestanding,interactive computer terminal that displays products and related information on a video screen is commonly referred to as a(n)________.

A) video kiosk
B) interactive vending machine
C) World Wide Web scanner
D) Internet scanner

Question 28

Under the FTC's Telemarketing Sales Rule,telemarketers must ________.

A) disclose their identity, and that the purpose of the call is selling
B) offer a refund to unsatisfied customers
C) initiate all calls between 9 A.M. and 9 P.M.
D) remove any prospect from their phone list on written request

Question 29

A typical response rate for a direct marketer is ________.

A) very low
B) moderate
C) high
D) very high

Question 30

Which is not a reason why direct marketing is especially suitable to small retailers?

A) Small retailers can inexpensively expand their trading area through direct marketing.
B) The costs and time demands of developing and maintaining a mailing list are low.
C) Consumers cannot determine the size of a retailer based on its catalog or Web site.
D) The costs of entry into direct marketing are low.

Question 31

An ethical issue that affects direct marketers relates to ________.

A) the sale of mailing lists
B) different prices charged in store and catalog operations
C) the distribution of overstocked goods to factory outlets
D) the cancellation of orders from suppliers that cannot deliver goods on time

Question 32

A major advantage of omnichannel retailing is the ability of consumers to ________.

A) examine products prior to purchase
B) receive merchandise several days after placing an order
C) use multiple channels and devices in their purchase journey
D) receive discounts based on direct marketers' lower costs

Question 33

Telemarketing is most closely part of ________.

A) direct marketing
B) direct selling
C) nontraditional retailing
D) interactive retailing

Question 34

The first step in developing a direct marketing strategy is ________.

A) generating customers
B) business definition
C) customer response
D) maintaining the database

Question 35

Which of the following encompasses buy on line and pick up in store?

A) single-channel retailing
B) multichannel retailing
C) omnichannel retailing
D) nonstore retailing

Question 36

Merchandise cannot generally be examined by consumers in which retail formats?

A) vending machines and direct marketing
B) direct selling and specialty stores
C) membership clubs and flea markets
D) retail catalog showrooms and membership clubs

Question 37

Which of the following is not an advantage of using the Web by retailers?

A) A Web site generally costs less to develop and maintain than a store.
B) The potential marketplace on the Web is large and dispersed.
C) Web sites do not have to be maintained after they are developed.
D) People can visit Web sites at any time.

Question 38

Which customer classification is least likely to respond to a direct marketer's efforts?

A) regulars
B) nonregulars
C) trivial buyers
D) nonrespondents

Question 39

A direct marketer can best respond to the increases in paper costs by ________.

A) reducing the height and width of the catalog and lowering the size of all photographs proportionately
B) using less costly grades of paper for photographs
C) recommending a Web site for additional information
D) purchasing recycled paper to appeal to ecologists, despite the still higher costs

Question 40

Direct selling and direct marketing are similar in that ________.

A) both are forms of dual distribution
B) both enable 24-hour per day ordering
C) mail and phone solicitations are used in both
D) store locations and fixtures are not necessary

Question 41

Which prospective customers are least likely to respond to a direct marketer's offering?

A) regulars and nonregulars
B) regulars and new contacts
C) new contacts and nonregulars
D) new contacts and nonrespondents

Question 42

Multichannel retailing is an example of what form of market segmentation strategy?

A) differentiated
B) homogeneous
C) skimming
D) niche

Question 43

Low costs to develop and maintain a catalog or Web site,the ability to outsource order fulfillment operations,and low inventory needs all contribute to ________.

A) a low level of competition within direct marketing
B) high direct marketing sales
C) low barriers to entry for direct marketing
D) the need for the 30-day rule of the Federal Trade Commission

Question 44

A firm uses both direct selling as well as department store formats to sell its cosmetic products.This illustrates ________.

A) an independent vertical marketing system
B) a partially integrated system
C) a fully integrated system
D) multichannel retailing

Question 45

A direct marketer can effectively cater to a highly specialized niche market through use of a(n)________.

A) search engine
B) selective binding
C) infomercial
D) specialog

Question 46

The most valuable asset of a highly profitable direct marketer is generally its ________.

A) owned mailing lists
B) rented mailing lists
C) employees
D) inventory

Question 47

Which lifestyle trend increased the desirability of direct marketing for consumers?

A) increased consumer sophistication
B) poverty-of-time
C) component lifestyle
D) increased ecological awareness

Question 48

Infomercials are ideally suited for ________.

A) nationally advertised manufacturer brands
B) goods that are not widely available that require a demonstration to show their benefits
C) private labels of major retailers
D) goods priced below market

Question 49

The handling of merchandise,including addressing,mailing,and billing customers is often conducted by third-party service providers on a fee basis.These firms are called ________.

A) direct marketing service specialists
B) mailing list brokers
C) expediters
D) order fulfillment firms

Question 50

Many direct marketers used to order merchandise after orders were placed by consumers.Now,they place orders in anticipation of demand.This change in strategy is largely due to ________.

A) concern over better customer service
B) the "30-day rule"
C) discounts on purchases in advance of customer orders
D) delays in order fulfillment houses

Question 51

Direct selling is not considered part of direct marketing since ________.

A) personal communication is used to initiate customer contact
B) no database is maintained
C) consumers do not interact with the firm
D) orders are not typically placed via mail or computer

Question 52

A direct marketer determines the goods and services sold as well as its target market in the ________ stage of a direct marketing strategy.

A) order fulfillment
B) generating customers
C) business definition
D) consumer response

Question 53

The "30-day rule" most directly relates to which stage of a direct marketing strategy?

A) presenting the message
B) measuring results
C) maintaining the database
D) order fulfillment

Question 54

A fishing specialties retailer concerned about the quality of a list of fly fishermen enthusiasts seeks to test a mailing list broker's mailing list.The retailer should ________.

A) purchase a mailing list
B) rent a mailing list
C) purchase a PC-based list of homeowners and mail catalogs to selected towns
D) seek to quickly develop its own list through a Web site

Question 55

A direct marketer can reduce its order fulfillment responsibilities by ________.

A) using a public warehouse
B) using a private warehouse
C) retaining a third party order fulfillment service provider
D) using a bonded warehouse

Question 56

Which prospective customers are most likely to respond to a direct marketer's offering?

A) regulars and nonregulars
B) regulars and new contacts
C) new contacts and nonregulars
D) new contacts and nonrespondents

Question 57

A direct marketer determined that its customers' high levels of dissatisfaction with the firm concerned late delivery,the wrong items being delivered,or items arriving in defective condition due to being damaged in transit.These complaints concern which direct marketing strategy?

A) order fulfillment
B) customer response
C) measuring results
D) customer contact

Question 58

The promotional strategy of most infomercials ________.

A) stresses presold merchandise
B) stresses infomercials
C) encourages consumers to act immediately; otherwise, they have to wait for a special to be repeated
D) utilizes network programming

Question 59

A direct marketer's selling advertising space to noncompeting firms in its catalogs most closely resembles ________.

A) vertical cooperative advertising
B) a leased department
C) an infomercial
D) a regional edition

Question 60

While a direct marketer's overall response rate is good,its average purchase amount per catalog is below average.Most of its orders were placed by phone.The direct marketer should ________.

A) train its telephone-based personnel to cross-sell merchandise
B) utilize smaller catalogs for new contacts
C) utilize larger catalogs for regular customers
D) encourage customers to mail in their orders

Question 61

Ordering information is flashed on the screen once in an infomercial.

Question 62

The use of party plans and group sales are strategies used by ________.

A) vending machine operators
B) direct marketers
C) Web-based marketers
D) direct sellers

Question 63

A major factor contributing to the low level of sales on the Web is ________.

A) consumer concern for credit card security on the Web
B) the need to constantly update each Web site
C) the poor demographics of Web users
D) the need for a Web master to be available during the hours the site is available for viewing

Question 64

Vending machine operators can expand their range of goods sold by ________.

A) increasing the number of machines in offices and factories
B) using microprocessors to record consumer preferences
C) adding dollar bill changers and debit card readers to current and new machines
D) adding voice synthesizers to existing and new machines

Question 65

Direct marketing enables a retailer to cover a large geographic area inexpensively and efficiently.

Question 66

The depersonalization of many neighborhoods and the increase in working women have had the greatest detrimental effect on which retailer?

A) direct marketing
B) direct selling
C) vending machines
D) retail catalog showroom

Question 67

Specialogs are often used to target new customers.

Question 68

Single-channel retailing is less complex to manage than multichannel retailing.

Question 69

Direct marketing,direct selling,and vending machines are all forms of nonstore retailing.

Question 70

A direct marketing strategy should start with media selection.

Question 71

The profitability of catalog-based direct marketers is highly sensitive to postal rates and paper costs.

Question 72

Some Web sites are a conglomeration of complementary noncompeting retailers.The Web site coordinator is responsible for promoting the master Web site address and for maintaining the computer server.Each retailer is then responsible for developing and updating its own Web site.This arrangement closely resembles a ________.

A) central business district
B) shopping center
C) leased department
D) franchise

Question 73

Which nontraditional retailing has a temporary captive audience?

A) airport retailing
B) vending machines
C) infomercials
D) direct marketing

Question 74

The ease of entry into direct marketing means that this is a highly competitive industry.

Question 75

Which forms of nonstore and nontraditional retailing are used by retailers that need to demonstrate their products to consumers for at least 15 minutes to show their unique features?

A) the World Wide Web and video kiosks
B) the World Wide Web and video catalogs
C) infomercials and direct selling
D) vending machines and direct marketing

Question 76

The addition of direct marketing to a store-based retailer is a complementary (instead of competitive)activity.

Question 77

Direct selling and conventional vending machines are included as forms of direct marketing since they are nonstore activities.

Question 78

Rent (or a percent of sales)has to be paid for each location with ________.

A) video kiosks and vending machines
B) the World Wide Web and the Internet
C) the Internet and video catalogs
D) video catalogs and video kiosks

Question 79

A computer magazine routinely sells or rents mailing lists of its subscribers to local computer stores.The magazine classifies its customers into categories based on their completing a comprehensive questionnaire.The magazine's practice constitutes a(n)________.

A) ethical practice
B) invasion of privacy
C) vertical cooperative promotion
D) horizontal cooperative promotion

Question 80

A trade-off to using a high degree of graphics on a Web site is the ________.

A) need for high-speed modems to download the graphics
B) need to constantly reconfigure the graphics
C) larger size of the Web site
D) increased downloading time for graphics-intensive sites