106. Interactivity is one of the new developments in retailing. In retailing, interactivity refers to:
a.
the use of improved communications with customers
b.
a new form of customer relationship marketing
c.
entertainment for customers to get them involved
d.
the use of information kiosks
e.
the creation of a static atmosphere
107. Build-a-Bear is a retailer where children can design and assemble a stuffed animal from shelves full of
parts. Each child starts by deciding what animal they want. Then, the child moves to a place where the
stuffing is added. Finally, the child moves to the area where the last accessories are added.
Build-A-Bear is part of a recent trend in retailing referred to as::
a.
nonstore retailing
b.
m-commerce
c.
convenience retailing
d.
e-business
e.
adding interactivity
108. At the American Girl store in Chicago, dolls can be purchased and girls can then go to the American
Girl Café or American Girl Theatre, and even have birthday parties. This is an example of using:
a.
nonstore retailing
b.
m-commerce
c.
convenience retailing
d.
e-business
e.
interactivity
109. Pop-up shops are:
a.
Web sites that pop up while you are visiting a site
b.
m-commerce
c.
convenience retailing
d.
e-business
e.
temporary retail establishments
110. Calendar Club stores are open only from November until January, usually in an otherwise vacant store.
This is an example of a:
a.
temp store
b.
m-commerce
c.
convenience retailing
d.
pop-up shop
e.
flash store
John Diaz immigrated to Tallahassee from Cuba in the 1980s. He set up a coffee shop called Diaz in a
small upper-middle-class neighborhood. It rapidly became popular because of the wonderful coffee it
brewed. Soon Diaz was selling the finest coffees from around the world, plus coffee-making
necessities such as grinders and brewers. Within ten years, Diaz was operating a lucrative mail-order
business in addition to his coffee shop.
Upon entering the shop, the first thing the customer sees is a countertop crowded with all of the
machinery needed for making a perfect cup of coffee. Marble-topped tables are set in cozy nooks with
overstuffed chairs. Bookshelves on one wall hold books about coffee for patrons to read while they
sip. The smell is intoxicating to a real coffee lover. Coffee drinkers can take home a pound when they
leave. The store carries all types of coffee from $300 per pound Kopi Luwak from Sumatra to
Brazilian Cerrado for $8 a pound.
111. Refer to Diaz. In terms of ownership, Diaz’s coffee shop would be classified as a(n):
a.
franchise
b.
wholesaler
c.
independent retail operation
d.
agency
e.
chain store
112. Refer to Diaz. The type of merchandise carried by Diaz is deep but with a narrow assortment. The
store would most likely be classified as a:
a.
convenience store
b.
mass merchandiser
c.
specialty store
d.
category killer
e.
membership club
113. Refer to Diaz. Customers of Diaz’s coffee shop can purchase coffee, coffee makers, mugs, chocolate,
music CDs, and all sorts of unique gift items. Diaz is practicing:
a.
m-commerce
b.
interactive merchandising
c.
lifestyle merchandising
d.
scrambled merchandising
e.
pop-up shopping
114. Refer to Diaz. If Diaz wanted to grow his business and granted another owner the rights to use his
format and approach to doing business, he would be involved in:
a.
trading up
b.
m-commerce
c.
direct marketing
d.
product and trade name franchising
e.
business format franchising
115. Refer to Diaz. The smell of fresh coffee, the fact it is made where drinkers can watch the process, and
the comfortable chairs all are used to create the store’s:
a.
atmosphere
b.
cultural impact
c.
target strategy
d.
merchandise mix
e.
promotional strategy
Walmart, the world’s largest retailer by revenue, announced that it will get back to its founder’s roots
by initiating more price cuts. Critics claimed that the giant was getting away from its original focus
because it posted relatively high gross profit margins. CEO Mike Duke assuaged critics by saying
Walmart’s $400 billion in sales will become even larger because the price cuts will attract more
customers and it will lower its costs of goods sold.
116. Refer to Walmart. In terms of ownership, Walmart would be classified as a(n):
a.
independent retailer
b.
chain store
c.
franchise
d.
discount store
e.
department store
117. Refer to Walmart. Walmart’s gross margin is the:
a.
total sales from all of its stores worldwide
b.
amount of money it makes as a percentage of sales after the cost of goods sold is
subtracted
c.
amount of money it makes as a percentage of sales before taxes
d.
amount of money it makes as a percentage of sales after all costs are subtracted
e.
net profit it earns after all expenses and taxes are subtracted
118. Refer to Walmart. Many Walmart stores have a full line of groceries and general merchandise with a
wide range of services, such as a pharmacy, portrait studio, optical shop, and bank. Walmart is an
example of which type of discount store?
a.
hypermarket
b.
supermarket
c.
extreme-value retailer
d.
supercenter
e.
category killer
119. Refer to Walmart. Most Walmart stores are not located in shopping centers but rather are buildings
all by themselves. This type of location is referred to as a:
a.
primary outlet
b.
freestanding store
c.
pop-up store
d.
single-unit retailer
e.
strip store
120. Refer to Walmart. Which type of pricing strategy describes Walmart’s commitment to offer
consistently lower prices?
a.
high-low pricing
b.
everyday low pricing (EDLP)
c.
extreme-value pricing
d.
prestige pricing
e.
marginal pricing
Apple Inc. opened its first Apple Store in 2001 and currently has hundreds of stores spanning several
countries. Many of the Apple Stores are inside malls, but Apple also has several free standing stores
they call their flagship stores, with each looking a little different on the outside. These are located in
New York City, Boston, Los Angeles, Chicago, San Francisco, Montreal, Tokyo, and Osaka.
The store in New York City is a glass cube with a glass cylindrical elevator and spiral staircase that
leads to an underground store. Inside they have long tables displaying products ranging from the iMac,
MacBook Air, iPods, printers, cameras, and other accessories. All these products are accessible to
customers who can try them out and ask various questions of informed associates. The walls are
mostly metallic and the signs are all backlit.
All stores have a Genius Bar where a customer can receive technical advice or set up service and repair
for their products. To address the needs of the many iPod users, some stores, such as the New York
store, have set up a separate iPod Bar where customers can get their own technical assistance. They
also have an iMac station for kids who want to try out games and learning products and a theatre for
workshops, product training sessions and special presentations.
Apple introduced the handheld Easy Pay system where customers don’t have to wait in line to
purchase products and with a simple click of a paperless, handheld credit card scanner, the employee
brings the cash register to the customer. Items can be rung up anywhere on the show room floor. Apple
plans to open several more stores in the years to come.
Apple also has its online store. At its web site a customer can order any Mac or iPod product, plus a
large variety of accessories. In addition to its product offerings, a customer can watch a
demonstration of how products work or check out the latest Mac ads or news.
121. Refer to Apple Stores. In terms of ownership, which of the following best describes Apple stores?
a.
independent retailer
b.
chain stores
c.
franchises
d.
pop-up shop
e.
department stores
122. Refer to Apple Stores. Of the major types of retail operations, Apple stores are _____.
a.
department stores
b.
specialty stores
c.
superstores
d.
convenience stores
e.
discount stores
123. Refer to Apple Stores. What method of nonstore retailing does Apple take advantage of through the
use of its Web site?
a.
telemarketing
b.
automatic vending
c.
direct mail
d.
catalogs and mail orders
e.
electronic retailing
124. Refer to Apple Stores. Some shoppers purposely plan to visit the Apple store on Fifth Avenue in New
York City, which is characteristic of:
a.
generator stores
b.
lifestyle stores
c.
interactive stores
d.
m-stores
e.
destination stores
125. Refer to Apple Stores. Apple has the Genius Bar, the backlit signs, the Apple products themselves, the
modern metallic walls and spiral staircases in its stores. These are all work together to convey the
store’s _____.
a.
impression
b.
environment
c.
atmosphere
d.
surroundings
e.
elements
126. Refer to Apple Stores. The Genius Bar where customers can ask questions of knowledgeable personnel
is an example of getting consumers involved in the retail experience, also known as _____.
a.
product
b.
presentation
c.
m-commerce
d.
interactivity
e.
elements
ESSAY
1. Define retailing and list the factors that are used to classify retail operations.
2. Define independent retailer, chain store, and franchise and give an example of each.
3. There are several types of retail stores, each offering a different product assortment, service level, and
price level, according to the shopping preferences of its customers. Name ten types of retailers. For
each type, indicate the level of service, price level, and width of product assortment.
4. A specialty store is not only a type of store, but also a method of retail operations. Describe the
specialty store strategy. Then name two examples of specialty stores.
5. Compare and contrast supermarkets and convenience stores. Name several characteristics of each store
in your answer.
6. Based on demographic trends in the U.S., discuss the likely prospects for the drugstore industry over
the next few years.
7. Discount stores are retail chains that compete on the basis of low prices, high turnover, and high
volume. Name and briefly describe four types of discounters, and give an example of each type.
8. Compare and contrast restaurants with retailing establishments and service establishments.
9. Retailing opportunities can take place without customers shopping at a store. Name and briefly discuss
four forms of nonstore retailing.
10. Defining franchising and discuss the two basic forms of franchising. Give an example of each form.
11. After defining and selecting a target market, retailers must develop the six Ps of the retailing mix to
successfully meet the needs of the chosen target market. What are the six Ps of the retailing mix?
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12. What is the first task of developing a retail strategy? What is involved in this task?
13. When retailers decide on location, they have two basic site options: the freestanding store and the
shopping center. Briefly describe these location alternatives and discuss the advantages and
disadvantages of each location alternative.
14. Define store atmosphere and name and briefly describe the major determinants of store atmosphere.
15. Compare and contrast trading up and suggestive selling.
16. Name and briefly describe two new developments in retailing.