Introduction to Electronic Commerce, 3e (Turban)
Chapter 4 Online Consumer Behavior, Market Research, and Advertisement
4.1 True/False
1) Netflix implemented intelligent agents in its movie recommendation service called CineMatch
to help customers select movies they would like to watch and to better manage its inventory.
2) Finding and retaining customers is a major critical success factor for most offline and online
businesses.
3) One of the keys to building effective customer relationships is an understanding of intelligent
agents.
4) When Chaplin’s auto lease is about to expire, he decides it is time to buy a new car. This
imbalance between a desired state and an actual state is called need identification.
5) When making a purchasing decision, deciding what product to buy is referred to as product
brokering.
6) When making a purchasing decision, deciding from whom to buy the product is referred to as
merchant brokering.
7) In the consumer decision-making process, the buyer is the person who ultimately makes the
buying decision.
8) In the purchase decision-making process, blogs and search engines support the evaluation,
negotiation, and selection step.
9) The first step in the purchase decision-making process is product evaluation and comparison.
10) Virtual catalogs and links to external sources support the information search step in the
purchase decision-making process.
11) Mass marketing treats each customer in a unique way such as fitting advertising with the
customer’s profile and needs.
12) Personalization matches services, products, and advertising content with large groups of
customer segments.
13) A user profile defines customer preferences, behaviors, and demographics and can be
generated by observing what the user does online.
14) Behavioral targeting uses information collected on an individual’s actual Internet purchases
to select which advertisements to display to that individual.
15) A cookie is a data file that is placed on a user’s hard drive by a remote Web server only when
the user gives full consent to collect information about the user’s activities at a site.
16) Customer loyalty is a deep commitment to rebuy or repatronize a preferred product or
service consistently in the future, thereby causing repetitive same-brand purchasing.
17) Universal services increase customer loyalty through personalization.
18) Customer loyalty leads to enhanced resistance to competitors, a decrease in price sensitivity,
and an increase in favorable word-of-mouth.
19) Attracting and retaining loyal customers is the most important issue for e-tailers because
customer loyalty can lower marketing and advertising costs, transaction costs, customer turnover
expenses, and failure costs such as warranty claims.
20) E-loyalty is customer loyalty to an e-tailer or loyalty programs delivered online or supported
electronically.
21) The aim of market research is to discover marketing opportunities and issues, to establish
marketing and advertising plans, to better understand the purchasing process, and to evaluate
marketing performance.
22) Spyware is tiny graphics files embedded in e-mail messages and in Web sites that transmit
information about users and their movements to a Web server.
23) One problem with Web analytics, Web mining, and clickstream data is that we observe and
follow a computer, not knowing who is actually moving the mouse.
24) Ad spawning refers to ads that appear in separate windows before, after, or during Internet
surfing or when reading e-mail.
25) Search engine tuning increases site rank on search engines.
1) A ________ is someone whose advice or view carries some weight in making a final
purchasing decision.
A) initiator
B) influencer
C) decider
D) buyer
2) In the consumer decision process, which of the following roles ultimately makes the buying
decision or any part of it?
A) buyer
B) initiator
C) influencer
D) decider
3) Which of the following CDSS support facilities supports information searching?
A) agents and event notification
B) virtual catalogs
C) blogs
D) customer testimonials
4) Banner advertising on Web sites helps trigger a realization that there is a gap between reality
and a desired state, which occurs in the ________ stage of the EC purchase decision-making
process.
A) need identification
B) information search
C) evaluation
D) product brokering
5) EC businesses generate user profiles in each of the following ways except by
A) asking users to fill in a questionnaire.
B) using cookies, spyware, or Web bugs to observe what people are doing online.
C) using customer segmentation to identify customers’ preferences.
D) basing them on what customers have purchased online before.
6) The use of cookies
A) is one of the most controversial issues in EC.
B) has not helped Internet marketers target their ads.
C) is a widely used method for mass marketing.
D) is being replaced by adware and spyware programs.
7) Key factors limiting the use of personalization include
A) matching profiles with product offerings and delivering those offerings.
B) communication costs and filtering costs.
C) privacy and trust issues.
D) lack of customer loyalty and service customization costs.
8) Examples of personalization include
A) notifying a customer when an auction comes to a close.
B) allowing a user to personalize Web site attributes.
C) sending an instant alert to customers’ mobile devices, notifying them about a drop in a
product’s price.
D) all of the above.
9) By increasing customer loyalty, EC companies achieve each of the following benefits except
A) lower marketing and advertising costs.
B) lower click through rates.
C) lower transaction costs.
D) lower customer turnover expenses.
10) Using cookies to “sell under the guise of research” is called
A) market segmentation.
B) one-on-one marketing.
C) e-sugging.
D) electronic research.
11) The introduction of EC has
A) decreased customer loyalty because customers can more easily shop, compare, and switch to
different vendors.
B) increased customer loyalty because customers do not have time to shop around.
C) increased the cost of acquiring and retaining customers.
D) decreased advertising and promotion costs.
12) The psychological status of willingness to depend on another person or organization best
defines
A) e-shopping.
B) trust.
C) satisfaction.
D) e-sugging.
13) Finding information and knowledge that describe the relationships among consumers,
products, marketing methods, and marketers is the goal of
A) market segmentation.
B) e-tailing.
C) market research.
D) collaborative filtering.
14) Procter & Gamble (P&G) used the Internet in the new product development of Whitestrips, a
teeth-brightening product. Based on this experience, P&G
A) decided to add Internet research to its traditional marketing test model.
B) could not determine the target market segments for the Whitestrips.
C) learned that the cost of online surveys was about the same as similarly sized telephone
surveys, but online surveys expedited research considerably.
D) reduced the time-to-market from concept to market launch by approximately two years.
15) To avoid obtaining inaccurate information from online survey participants, marketers learn
about customers by observing their behavior using each of the following except
A) transaction logs that record user activities at a company’s Web site.
B) cookies that allow a Web site to store data on the user’s PC.
C) spyware that gathers user information through an Internet connection without the user‘s
knowledge.
D) data mining to analyze clickstream data.
16) Which of the following major factors is the most important predictor of online buying
behavior?
A) product information requested
B) number of related e-mails
C) number of orders made
D) gender
17) Data collection methods in the Web 2.0 environment include each of the following except
A) folksonomy.
B) branding.
C) chatting.
D) polling.
18) The tiny graphics files embedded in e-mail messages and in Web sites that transmit
information about users and their movements to a Web server are
A) cookies.
B) shopbots.
C) chatterbots.
D) Web bugs.
19) Customer movements on the Internet best describes
A) Internet traffic.
B) clickstream behavior.
C) transaction tracking.
D) hits.
20) Which of the following statements about Web mining is false?
A) Web mining uses data mining techniques for discovering and extracting information from
Web documents.
B) Web mining explores both Web content and Web usage.
C) Web mining uses customer data to infer or predict customer interest in other products or
services.
D) Usage analysis is derived from clickstream data.
21) Once a company knows a consumer’s preferences, the company can predict, without asking
the consumer directly, what other products or services that consumer might enjoy through
A) active Web bugs.
B) spyware.
C) collaborative filtering.
D) personalization.
22) The key problem that biometric marketing is intended to solve is
A) knowing the identity of the actual shopper.
B) improving the accuracy of the shopper’s data.
C) increasing the speed of order processing.
D) creating a loyalty program.
23) The ethical issue raised by collaborative filtering is
A) spamming.
B) invasion of privacy.
C) theft of intellectual property.
D) security.
24) Banner ads that appear when a predetermined word is queried from a search engine are
A) personalized banners.
B) random banners.
C) keyword banners.
D) stylized banners.
25) An ad that appears underneath the current browser window, so when the user closes the
active window the ad is still on the screen describes
A) random ad.
B) pop-up ad.
C) ad spawning.
D) pop-under ad.
26) Word-of-mouth marketing by which customers promote a product or service by telling others
about it is referred to as
A) affiliate marketing.
B) viral marketing.
C) target marketing.
D) search engine marketing.
27) Tracking how long viewers watch an advertisement, what percentage of the video clip
viewers watch, and how often they see an advertisement describes
A) search engine rankings.
B) traction.
C) brand interaction.
D) market slicing.
28) One of the major challenges of one-to–one advertising is ________, or the flooding of users
with junk e-mail, banners, and pop-ups.
A) interstitial
B) permission marketing
C) spamming
D) behavioral targeting
29) Web site content is especially important to increase stickiness because
A) customers are expensive to acquire.
B) Web sites are expensive to maintain.
C) competitors are always attempting to steal away customers.
D) of Internet-accessible mobile devices.
30) As the volume of customers, products, vendors, and information increases, it becomes
uneconomical, or even impossible, for customers to consider all relevant information and
available products and services. The practical solution to handling such information overload is
to
A) use permission marketing.
B) use software or intelligent agents.
C) increase the use of ad agencies.
D) design Web sites with minimal content.
1) A(n) ________ is a person whose advice or view carries some weight in making a final
purchasing decision.
2) The final phase in the generic purchasing-decision model is the ________ phase which
consists of customer service and evaluation of the usefulness of the product.
3) ________ treats each customer in a unique way to fit marketing and advertising with the
customer’s profile and needs.
4) ________ matches services, products, and advertising content with individuals and their
preferences.
5) A ________ is the requirements, preferences, behaviors, and demographic traits of a particular
customer.
6) A ________ is a data file that is placed on a user’s hard drive by a remote Web server,
frequently without disclosure or the user’s consent, that collects information about the user’s
activities at a site.
7) ________ is the use of information collected on an individual’s Internet-browsing behavior to
select which advertisements to display to that individual.
8) ________ is a deep commitment to rebuy or repatronize a preferred product or service
consistently in the future, thereby causing repetitive same-brand purchasing.
9) ________ and ________ are the two most important factors in determining customer e-
loyalty.
10) ________ is the psychological status of willingness to depend on another person or
organization.
11) A ________ is a record of user activities at a company’s Web site.
12) As customers move from a Web site to other Web sites, they establish their ________, which
is a pattern of their movements on the Internet.
13) ________ are tiny graphics files embedded in e-mail messages and in Web sites that transmit
information about users and their movements to a Web server.
14) ________ is software that gathers user information over an Internet connection without the
user’s knowledge.
15) ________ are data that occur inside the Web environment, and they provide a trail of the
user’s activities in the Web site.
16) ________ uses data mining techniques for discovering and extracting information from Web
documents and Web usage.
17) ________ is online marketing, facilitated by the Internet, by which marketers and advertisers
can interact directly with customers, and consumers can interact with advertisers or vendors.
18) ________ are the number of times users call up a page that has a banner on it during a
specific period; known as impressions or page views.
19) ________ is the fee an advertiser pays for each 1,000 times a page with a banner ad is
shown.
20) ________ is the characteristic that influences the average length of time a visitor stays in a
site.
21) ________ is online advertising that focuses on social networking sites.
22) ________ is a way of measuring what viewers do when they watch an online video.
23) ________ is a marketing arrangement by which an organization refers consumers to the
selling company’s Web site.
24) ________ is a free Internet news service that broadcasts personalized news and information,
including seminars, in categories selected by the user.
25) The process of converting media products developed in one environment to a form culturally
and linguistically acceptable in countries outside the original target market describes ________.
1) Identify and discuss the five phases in the generic purchasing-decision model.
2) List and briefly discuss the five major roles that people play in the decision-making process.
3) Briefly discuss three major one-to-one online data collection approaches.
4) List four reasons why Web advertising is growing rapidly.
5) List the three major social network advertising classifications.