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Chapter 12: Deliver the Customer Experience: Bricks and Clicks
IV. END-OF-CHAPTER ANSWER GUIDE
CHAPTER QUESTIONS AND ACTIVITIES
QUESTIONS: TEST YOUR KNOWLEDGE
12.1 Define retailing. What is the role of retailing in today’s world?
12.2 How does the wheel-of-retailing theory explain the evolution of retailing? How do the
economic environment, demographics, technology, and globalization affect the future of
retailing?
The wheel-of-retailing hypothesis is a theory that explains how retail firms change, becoming more
“upscale” as they go through their life cycle. The suggestion is that retailers compete on price and
then move “upscale,” leaving room for other new, low-price entrants.
12-3 Describe experiential merchandising, destination retailing and omnichannel marketing.
1 Experiential merchandising is a tactic whose intent is to convert shopping from a passive
7
1 Destination retailing refers to a store that consumers view as distinctive enough to go out
Copyright © 2018 Pearson Education
Chapter 12: Deliver the Customer Experience: Bricks and Clicks
12-4 What is beacon marketing? What are digital wallets?
12-5 Explain retail store shrinkage and the ways shrinkage normally occurs. What is
“sweethearting”? What is retail borrowing? What are some of the ethical issues in retailers’
treatment of consumers?
Shrinkage is the term retailers use to describe losses due to shoplifting, employee theft, and damage
to merchandise. Analysts estimate that shrinkage during 2005–2006 was 2.76 percent of overall retail
sales.
12-6 How do marketers classify retail stores? Explain merchandise breadth and depth.
Retail stores are classified by: (1) what they sell—the merchandise mix. In retailing, a product line is
the set of related products offered by the retailer; and (2) by level of service.
Self-service retailers do not assist customers in making selections.
12-7 Describe the differences in merchandise assortments for convenience stores, supermarkets,
box stores, specialty stores, category killers, leased departments, variety stores, general
merchandise discount stores, off-price retailers, warehouse clubs, factory outlet stores,
department stores, hypermarkets, and pop-up stores.
Differences in merchandise assortments for the following types of retailers include:
a. Convenience stores: neighborhood retailers that carry a limited number of frequently
b. Supermarkets: food stores that carry a wide selection of edibles and related products.
Copyright © 2018 Pearson Education
Chapter 12: Deliver the Customer Experience: Bricks and Clicks
c. Box stores: food stores that have a limited selection of items, few brands per item and few
12-8 Explain the different types of direct selling. What is the difference between a multilevel
network and a pyramid scheme?
Direct selling includes door-to-door sales, parties, and networks. Door-to-door selling is one of the
oldest forms of retailing. However, the method is declining in the United States because of the high
Home shopping parties are popular in neighborhoods and useful if the product needs intimacy and
demonstration to execute a sale. Many times, party participants buy out of obligation to the host and
Multilevel network, also known as network marketing, is a system with master distributor recruits
12-9 What is B2C e-commerce? What are some benefits of B2C e-commerce for consumers and
for marketers? What are the limitations of B2C e-commerce?
Copyright © 2018 Pearson Education
Chapter 12: Deliver the Customer Experience: Bricks and Clicks
Business-to-consumer (B2C) e-commerce is the online exchange between companies and individual
consumers.
Benefits of B2C e-commerce include:
a. E-commerce allows consumers and marketers to easily find and make exchanges in a global
marketplace.
b. From a consumer’s perspective, electronic marketing has increased convenience by breaking
down the barriers caused by time and location.
Limitations of B2C e-commerce include:
a. Consumers still may have to wait several days before receiving merchandise.
b. Some websites are poorly designed, confusing, and irritating.
12-10 What are some possible effects of B2C e-commerce on traditional retailing?
Areas to begin a discussion with include:
12-11 What are intangibles? How do basic marketing concepts apply to the marketing of
intangibles?
12-12 What is a service? What are the important characteristics of services that make them
different from goods?
Copyright © 2018 Pearson Education
Chapter 12: Deliver the Customer Experience: Bricks and Clicks
12-13 What dimensions do consumers and business customers use to evaluate service quality? How
should marketers respond to failures in service quality?
Because services are inseparable in that they are not produced until they are consumed, consumers
and business customers find it difficult to estimate how good service will be until it is purchased.
Therefore, marketers come up with ways for to illustrate the benefits their services will provide.
12-14 What do we mean by marketing people? Marketing places? Marketing ideas?
People are products and are marketed as such. A number of people hire personal image consultants to
devise a marketing strategy for them, others undergo plastic surgery, physical conditioning, or
cosmetic makeovers to improve their “market position” or “sell” themselves.
ACTIVITIES: APPLY WHAT YOU’VE LEARNED
12-15 Creative Homework/Short Project Assume you are an entrepreneur who is seeking
funding to start up your new retail business specializing in handcrafted artisan goods from
developing and least developed countries. Customers would be able to acquire a unique
product and at the same time receive a good feeling knowing that a portion of the price paid
for the product would go back to the individuals who produced the product. Using the
wheel of retailing as a guide, map out how you expect your business to grow and change
over time while remaining profitable.
MyMarketingLab for answers to Assisted Graded Questions.
12-16 Creative Homework/Short Project Assume that you are the director of marketing for a
national chain of convenience stores. Your firm has about 200 stores located in 43 states.
The stores are fairly traditional both in design and in the merchandise they carry. Because
you want to be proactive in your marketing planning, you are concerned that your firm may
Copyright © 2018 Pearson Education
Chapter 12: Deliver the Customer Experience: Bricks and Clicks
need to consider making significant changes because of the current economic, demographic,
technological, and global trends in the marketplace. You think it is important to discuss
these things with the other executives at your firm. Develop a presentation that includes the
following:
Students should begin to develop their presentation by reviewing the material on demographic,
technological, and global changes found in the chapter. They will notice that demographic changes
such as an aging population will affect how retailers implement strategies in the future (for instance,
12-17 In Class, 10–25 Minutes for Teams Retailers are faced with the problem of shrinkage and
what to do about it. Shrinkage comes, of course, from shoplifting and employee theft. More
subtle, however, is shrinkage that involves customers, such as “sweethearting” and “retail
borrowing.” Many consumers feel that such practices are okay. Conduct a short survey of
students in your group to study these two sources of shrinkage. You might want to include
questions about the following:
This activity is sure to provide controversial opinions from students. The book provides the
following on “sweethearting” and “retail borrowing.”
“Sweethearting” is an employee practice in which a cashier consciously undercharges,
gives a cash refund, or allows a friend to walk away without paying for items. Sometimes
a dishonest employee simply carries merchandise out the backdoor to a friend’s waiting
12-18 Creative Homework/Short Project You just started working for a firm that sells baseball
caps. Currently, the firm sells its products only in specialty stores, like Lids. You think
Copyright © 2018 Pearson Education
Chapter 12: Deliver the Customer Experience: Bricks and Clicks
you can improve sales by branching out to other types of retailers. Prepare a presentation
that identifies the additional types of retailers your firm could sell to and what the
advantages of selling to those types of retailers would be. Also, how would you change
your retail strategy for these different retailers?
MyMarketingLab for answers to Assisted Graded Questions.
12-19 For Further Research (Individual) One problem that traditional retailers face when they
open online stores is cannibalization. Select a traditional retailer where you and your
fellow students might normally shop that also sells products online. You might, for
example, select Best Buy, Banana Republic, Gap, or Target. Visit the retailer’s online
store and make notes on the site’s product offering, pricing, customer service policies, and
so on. (If the store you have chosen offers many different product lines, you might wish to
limit your research to one or two different product lines.) Then visit the store and compare
what is offered there with the online offerings. Develop a report that summarizes your
findings and discusses the potential for cannibalization and its implications for the retailer.
Also, discuss any changes in either the online or store strategies that you would
recommend.
store?
Copyright © 2018 Pearson Education
