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CHAPTER 3 MARKETING IN THE INTERNET AGE MULTIPLE

CHOICE QUESTIONS

1. All of the following would be considered to be specific

forces that underlie the new Internet age EXCEPT: a.
digitalization and connectivity. b. the explosion of the
Internet. c. customization and customerization. d.
increasing affluence and income in the United States.
Answer: (d) Difficulty: (2) Page: 78 2. Which of the
following best characterizes digital information? a. a
stream of zeros and ones, or bits b. something made
possible high speed printers and color reproduction c.
information in virtual space d. space containing
compacted data Answer: (a) Difficulty: (1) Page: 78 3.
Today a growing number of appliances and systems
operate on digital information. For bits to flow from one
appliance or location to another requires a
telecommunications network. a. customization b.
customerization c. connectivity d. concentration Answer:
(c) Difficulty: (2) Page: 78, 79 4. are networks that
connect people within a company to each other and to
the company network. a. Internets b. Intranets c.
Extranets d. Compunets Answer: (b) Difficulty: (1) Page:
79 44 5. A network that connects a company with its
suppliers and distributors is called a(n): a. Internet. b.
Intranet. c. Extranet. d. Compunet. Answer: (c)
Difficulty: (2) Page: 79 6. The Johnson Company is
seeking to expand its business onto the made possible
recent advances in technology. To do this, the Johnson
Company would most likely choose the: a. Internet. b.
Intranet. c. Extranet. d. Compunet. Answer: (a)
Difficulty: (1) Page: 79 7. early 2001, Internet
penetration in the United States had reached close to: a.
100 percent. b. 90 percent. c. 75 percent. d. 60 percent.
Answer: (d) Difficulty: (3) Page: 79 8. The explosive
worldwide growth in usage forms the heart of the New
Economy. a. population b. c. Internet d. Intranet Answer:
(c) Difficulty: (1) Page: 79 9. Established retailers of all
kinds began to doubt their futures as competitors sprung
up selling their products and services via the Internet.
They feared being the new a. upstaged b. technologically
intermediated c. disintermediated d. contaminated
Answer: (c) Difficulty: (3) Page: 80 45 15. involves
buying and selling processes supported electronic
means, primarily the Internet. a. b. c. d. Answer: (a)
Difficulty: (2) Page: 82 16. Within marketplaces have
become: a. market regions. b. market zones. c.
marketspaces. d. marketdynamos. Answer: (c) Difficulty:
(1) Page: 82 17. The flip side of is: a. b. c. d. Answer:
(d) Difficulty: (1) Page: 82 18. All of the following could
be listed as benefits to buyers should they choose to buy
via the Internet EXCEPT: a. it can be convenient. b. it
always provides buyers with the lowest competitive
prices. c. it can provide buyers with greater product
access and selection. d. it can provide buyers with access
to a wealth of comparative information. Answer: (b)
Difficulty: (2) Page: 82 19. Buyers can often use the Web
site to create exactly the configuration of information,
products, or services they desire. Which of the following
buyer benefits would most appropriately match the above
phrase? a. The Internet can be convenient. b. The
Internet is interactive and immediate. c. The Internet can
provide buyers with greater product access and selection.
d. The Internet can always provide the lowest prices on
merchandise. Answer: (b) Difficulty: (2) Page: 82, 83 47
20. All of the following could be listed as benefits to
sellers should they choose to sell via the Internet
EXCEPT: a. the Internet is a powerful tool for customer
relationship building. b. the Internet is a more secure
place to conduct transactions than in a retail
environment. c. the Internet reduces costs and increases
speed and efficiency. d. the Internet offers truly global
commerce. Answer: (b) Difficulty: (2) Page: 83, 84 21.
One author concludes that Web customers are often very
loyal, and the Internet promotes this loyalty. This would
be an example of which of the following benefits to
sellers for using the Internet to conduct commerce? a.
The Internet is a powerful tool for customer relationship
building. b. The Internet is a more secure place to
conduct transactions than in a retail environment. c. The
Internet reduces costs and increases speed and
efficiency. d. The Internet offers truly global commerce.
Answer: (a) Difficulty: (2) Page: 83, 84 22. Which of the
following would not be considered to be among the major
Internet domains? a. B2C b. B2B c. G2C d. C2C Answer:
(c) Difficulty: (1) Page: 84 23. Which of the following
most accurately describes a transaction wherein online
selling of goods and services goes to final consumers? a.
B2C b. B2B c. C2B d. C2C Answer: (a) Difficulty: (2)
Page: 84 24. Although Internet users are still younger on
average than the population as a whole, consumers aged
50 and older make up: a. almost 10 percent. b. almost
20 percent. c. almost 30 percent. d. almost 40 percent.
48 29. Josh Nielsen has decided to sell demonstration ski
equipment that he has obtained from a Head Ski
salesperson via eBay using its auction feature. Which of
the following Internet domains would most accurately
describe the form of business Josh is using? a. B2C b.
B2B c. C2B d. C2C Answer: (d) Difficulty: (2) Page: 91
30. Sheryl Scott checked in to her favorite In her chat
room, she was able use library features, exchange
information with online acquaintances in real time, and
make new friends with whom she can air her views on a
variety of subjects. Which of the following terms would
be an appropriate description of Ms. chat room? a. an
open trading network b. a private trading network c. a
forum d. a private channel Answer: (c) Difficulty: (2)
Page: 91 31. is the Internet version of forums. However,
such groups are limited to people posting and reading
messages on a specified topic, rather than managing
libraries or conferencing. a. An open trading network b. A
private trading network c. A private channel d. A
newsgroup Answer: (d) Difficulty: (3) Page: 92 32. Using
Priceline.com, buyers bid for airline tickets, hotel rooms,
rental cars, and even home mortgages, leaving the
sellers to decide whether to accept their offers. Which of
the following Internet domains best matches the above
example? a. B2C b. B2B c. C2B d. C2C Answer: (c)
Difficulty: (3) Page: 92 50 33. If an distribution channel
consisted of a seller, store channels, and consumers,
which of the following most accurately describes this
method of marketing? a. marketers b. marketers c.
marketers d. marketers Answer: (a) Difficulty: (1) Page:
92, Figure 34. If an distribution channel consisted of a
seller, store channels, channels (and interaction between
the store and channels), and consumers, which of the
following most accurately describes this method of
marketing? a. marketers b. marketers c. marketers d.
marketers Answer: (c) Difficulty: (3) Page: 92, Figure 35.
Which of the following would be the most appropriate
example of a transaction site? a. Amazon.com b. Yahoo
c. AOL d. eBay Answer: (d) Difficulty: (3) Page: 93 36.
Which of the following would be the most appropriate
example of a search a. Amazon.com b. Yahoo c. AOL d.
eBay Answer: (b) Difficulty: (1) Page: 93 37. failed for a
variety of reasons. Which of the following would be one
of the chief reasons for this failure? a. Companies were
unable to secure recognizable Web addresses. b.
Companies had poor technological advice and had great
technical difficulties. c. Companies tended to devote too
much effort to acquiring new customers instead of
building loyalty and purchase frequency among current
customers. d. Companies tended to have inflated prices
which discouraged purchase. 51 42. A(n) is a Web site
designed to build customer goodwill and to supplement
other sales channels rather than to sell the products
directly. a. and Webcasting site b. corporate Web site c.
online advertising or promotion Web site d. Web
community site Answer: (b) Difficulty: (2) Page: 97,
Figure 43. A company provides information about its
history, its mission and philosophy, and the products and
services that it offers on its: a. and Webcasting site. b.
corporate Web site. c. online advertising or promotion
Web site. d. Web community site. Answer: (b) Difficulty:
(2) Page: 98 44. A Web site that engages consumers in
interactions that will move them closer to a direct
purchase or other marketing outcome is called a(n): a.
and Webcasting site. b. online advertising or promotion
Web site. c. marketing Web site. d. Web community site.
Answer: (c) Difficulty: (2) Page: 98 45. The key to
designing an attractive Web site is to: a. create enough
value and excitement to get customers to come to the
site, stick around, and come back again. b. have cutting
edge graphics that demonstrate the technology available
to the Web marketer. c. have a least million in design
funds which provide for the interactivity demanded Web
savvy consumer. d. be willing beg, borrow, or steal ideas
from the top Web page designers and incorporate these
ideas into the own site. Answer: (a) Difficulty: (2) Page:
99 46. For Web sites, such as one for dental floss, a
company should create a corporate Web site to do all of
the following EXCEPT: a. answer customer questions. b.
build goodwill and excitement. c. become the primary
selling channel because of the reach of the Internet. d.
collect customer feedback. 53 Answer: (c) Difficulty: (2)
Page: 99 47. All of the following would be among the 7Cs
for effective Web site design EXCEPT: a. context. b.
content. c. community. d. conceptualization. Answer: (d)
Difficulty: (3) Page: 100 48. With respect to the 7Cs of
effective Web site design, refers to a layout and design.
a. context b. content c. community d. customization
Answer: (a) Difficulty: (2) Page: 100 49. All of the
following are characteristics of effective Web sites
EXCEPT: a. the lowest prices within an industry group. b.
deep and useful information. c. changing promotional
features. d. links to other related sites. Answer: (a)
Difficulty: (2) Page: 100 50. Advertising that appears
while consumers are surfing the Web, including banner
and tickler ads, interstitials, skyscrapers, and other forms
is called: a. specialty advertising. b. portal promotion. c.
online advertising. d. virtual advertising. Answer: (c)
Difficulty: (1) Page: 101 51. Sam Harrison is reviewing a
Web site for tennis shoes. He notices several
advertisements that move across the screen announcing
special discount travel offers if he purchases Nike tennis
shoes. These crawling advertisements are called: a.
interstitials. b. content sponsorships. c. banner ads. d.
microsites. Answer: (c) Difficulty: (1) Page: 101 54 57.
Webcasting is also known as as it affords an attractive
channel through which online marketers can deliver their
Internet advertising or other information content. a. pull
programming b. push programming c. customized
programming d. viral programming Answer: (b)
Difficulty: (3) Page: 107 58. Along with its considerable
promise, faces many challenges. All of the following,
according to the text, would be among those challenges
EXCEPT: a. poor revenue potential. b. limited consumer
exposure and buying. c. skewed user demographics and
psychographics. d. chaos and clutter. Answer: (a)
Difficulty: (2) Page: 108 59. Online users still tend to be
somewhat more upscale and more than the general
population. Which of the following challenges most
appropriately corresponds with this statement? a. ethical
concerns b. limited consumer exposure and buying c.
skewed user demographics and psychographics d. chaos
and clutter Answer: (c) Difficulty: (2) Page: 108 60. One
study found that a Web site must capture a Web
attention within eight seconds or lose them to another
site. Which of the following challenges most appropriately
corresponds with this statement? a. ethical concerns b.
security c. skewed user demographics and
psychographics d. chaos and clutter Answer: (d)
Difficulty: (3) Page: 108 QUESTIONS 61. According to
information provided in the text, Charles Schwab now
runs the largest site. 56 Answer: (True) Difficulty: (2)
Page: 78 62. New types of intermediaries are among the
four specific forces underlying the new Internet age.
Answer: (True) Difficulty: (2) Page: 78, Figure 63. The
increasing age factor of U.S. consumers is among the
four specific forces underlying the new Internet age.
Answer: (False) Difficulty: (2) Page: 78, Figure 64.
Digital information, which operates a growing number of
appliances and systems, comes in streams of Xs and 0s.
Answer: (False) Difficulty: (1) Page: 78 65. Extranets are
networks that connect a company with its suppliers and
distributors. Answer: (True) Difficulty: (1) Page: 79 66.
early 2001, Internet penetration in the United States had
reached close to 80 percent. Answer: (False) Difficulty:
(3) Page: 79 67. The Old Economy revolved around
advertising and promotion that mainly focused on the
idea of sell, sell, sell. Answer: (False) Difficulty: (2) Page:
80 68. In customerization, the company leaves it to
individual customers to design the offering. Answer:
(True) Difficulty: (1) Page: 80 69. The text defines as
buying and selling processes supported electronic
means, primarily the Intranet. Answer: (False) Difficulty:
(2) Page: 82 70. have physical marketplaces just like
traditional commerce. Answer: (False) Difficulty: (1)
Page: 82 71. B2C is the online selling of goods and
services to final consumers. 57 Answer: (False) Difficulty:
(3) Page: 101 81. Sam gets an from Microsoft describing
a new feature on Windows Sam then uses his to tell Bart
about the new feature. This would be an example of viral
marketing. Answer: (True) Difficulty: (2) Page: 102 82.
Viral marketing is the automatic downloading of
customized information of interest to PCs. Answer:
(False) Difficulty: (3) Page: 102, 105 83. One of the
major challenges facing online marketers is the inability
to ensure privacy. Answer: (True) Difficulty: (1) Page:
108 ESSAY QUESTIONS 84. List and briefly discuss the
four specific forces that underlie the new Internet age.
Answer: The four specific forces referred to in the text
are: a). Digitalization and of business operates on digital
information, which flows through connected networks. b).
The explosion of the Internet has grown explosively to
become the revolutionary technology of the new
millennium, empowering consumers and businesses alike
with the blessings of connectivity. c). New types of
Internet marketers and channel relationships have arisen
to replace some types of traditional marketers. Marketing
offers can be tailored. d). Customization and New
Economy is blurring the boundaries between industries,
allowing companies to pursue opportunities that lie at the
convergence of two or more industries. Difficulty: (2)
Page: 85. Discuss the difference between customization
and customerization. Use examples to illustrate the
difference. Answer: Customization involves taking the
initiative to customize the market offering. For example,
a salesperson takes a measurements, and the company
customizes the jeans at a factory. 59 In customerization,
the company leaves it to the individual customers to
design the offering. For example, jeans customers take
their own measurements and add specific features that
they may want in their jeans, such as colorful patches.
Difficulty: (1) Page: 80 86. State the definitions of and
Discuss the differences between the concepts. Answer:
a). use of electronic platforms (intranets, extranets, and
the Internet) to conduct a business. b). and selling
processes supported electronic means, primarily the
Internet. c). side of efforts to communicate about,
promote, and sell products and services over the
Internet. focuses on the platforms for delivery of
business activities. focuses on the processes for bringing
goods and services to consumers via the Internet. is the
side of (using the promotional mix components over the
Internet). Difficulty: (2) Page: 82 87. and the Internet
bring many benefits to both buyers and sellers. List and
briefly describe the major benefits to (a) buyers and (b)
sellers. Answer: Benefits to buyers: a). It can be
convenient. Customers do not have to battle traffic, find
parking spaces, and trek through stores and aisles to find
and examine products. b). Buying is easy and private.
Customers encounter fewer buying hassles and have to
face salespeople or open themselves up to persuasion
and emotional pitches. c). The Internet often provides
buyers with greater product access and selection. The
sky is the limit on the Web. d). Buyers have access to a
wealth of comparative about companies, products and
competitors. e). Online buying is interactive and
immediate. Consumers have a greater measure of
control. Benefits to sellers: a). The Internet is a powerful
tool for customer relationship building. b). The Internet
and other electronic channels can reduce costs and
increase speed and efficiency. avoid the expense of
maintaining a store and the accompanying costs of rent,
insurance, and utilities. Communication costs are less. 60
Answer: a). marketers would be considered the types of
marketers present before the Internet revolution and the
advent of the New Economy. In this form, a seller would
sell through store channels (intermediaries) to
consumers. b). which only operate online without any
market presence. In this form, a seller uses channels to
reach consumers. c). is a hybrid form. It is a traditional
company that has added to its operations. In this form, a
seller uses a combination of and channels to reach
consumers. Difficulty: (2) Page: Figure 91. List and
briefly characterize the four methods for setting up an
presence. Answer: a). Corporate Web Web site designed
to build customer goodwill and supplement other sales
channels, rather than to sell the products directly. This is
the most basic type of presence. These sites generally
provide information about the history, its mission and
philosophy, and the products and services that it offers.
b). Marketing Web Web site that engages consumers in
interactions that will move them closer to a direct
purchase or other marketing outcome. Such sites might
include a catalog, shopping tips, and promotional
features. c). Online advertising and that appears while
consumers are surfing the Web, including banner and
ticker ads, interstitials, skyscrapers, and other forms. d).
Web sites upon which members can congregate online
and exchange views on issues of common interest. These
communities are the online equivalent of a coffeehouse
(a place where everybody knows your address). Web
communities can either be social or Difficulty: (3) Page:
Figure 92. List and briefly characterize the 7Cs of
effective Web site design. Answer: The 7Cs are: a).
layout and design b). pictures, sound, and video that the
Web site contains c). ways that the site enables
communication d). ability to tailor itself to different users,
or allow users to personalize the site e). ways the site
enables or communication 62 f). that the site is linked to
other sites g). capabilities to enable commercial
transactions Difficulty: (3) Page: 100 93. Briefly describe
the following online advertising ads, tickers, interstitials,
skyscrapers, browser ads, and rectangles. Answer: a).
Banner ad that flashes information to the consumer while
visiting a Web page b). ads that move across the screen
c). ads that pop up between changes on a Web site d).
skinny ads at the side of a Web page e). Browser viewers
to watch them f). that are much larger that a banner
Difficulty: (1) Page: 101 94. Describe what happens in
Provide a descriptive example. Answer: Webcasting is the
automatic downloading of customized information of
interest to PCs, affording an attractive channel for
delivering Internet advertising or other information
content. An example would be Internet Financial
Infogate, which sends financial news, market data, and
stock quotes to subscribers in the financial services
industry for a fee. Difficulty: (1) Page: 105 95. Many
believe that has a bright future. However, will also face
many challenges in the next decade. List and briefly
describe the five major challenges discussed in the text.
Be specific in your comments and descriptions. Answer:
The major challenges are: a). Limited consumer exposure
and rapidly expanding, online marketing still only reaches
a limited marketspace. Market buying has not yet caught
up with browsing. b). Skewed user demographics and
audience is becoming more mainstream, however, online
users still tend to be somewhat more upscale and more
technology oriented than the general population.
Mainstream products have a difficult time being accepted.
c). Chaos and are millions of Web sites and a staggering
volume of information. Navigating the Internet can be
frustrating, confusing, and for consumers. 63