6.1 Quiz: Introduction (EN&NL)

Question 1

Which company provides a nice illustration of the concept of reintermediation?

PayPal
Facebook
E-bay
DHL

Answer 1

DHL

reintroduction of intermediaries to improve efficiency, add value, or address new challenges.

Internet offers new distribution channel
- potential channel conflicts
Internet has led to unbundling of information from traditional value chain channels
- disintermediation: cutting out the “middleman”
- reintermediation: new types of middlemen; eg. delivery services UPS, DHL and FedEx.

Question 2

Which statements is NOT CORRECT?

B2B relationships are often shorter-term than B2C which creates lower stickiness between the B2B partners involved.

B2B usually is a more complex process than B2C that may involve extensive negotiation over prices, product specifications, etc..

B2B is usually setup amongst a network of partners creating a so called collaborative commerce environment.

B2B typically requires IT system integration between the buyer and seller based on specialized technologies.

Answer 2

B2B relationships are often shorter-term than B2C which creates lower stickiness between the B2B partners involved.

Question 3

E-business is a broad term that not only refers to B2C e-commerce, but also has an important B2B component that is much more focused on the use of internet technology to optimize business processes between partners in a value chain.

True
False

Answer 3

True

Question 4

Goods delivered to private individuals via e-commerce are often returned. We generally refer to the transport activities involved in this with the term “reverse logistics”.

True
False

Answer 4

True

Question 5

When we compare e-commerce with traditional retail channels, you notice that the richness is declining. Because customers are not physically present, it is difficult or impossible to provide a personalized service and there is much less information exchange.

True
False

Answer 5

False

Three key features of e-commerce are *ubiquity, richness and reach
Ubiquity
available everywhere, at all times
*Reach
total number of users/customers e-commerce business can obtain
through universal standards (3G/4G/5G, HTML 5, HTTP, etc.)
lower entry and search costs
*Richness
complexity and content of message
Interactivity; 2-way communication between merchant and consumer
Information density; total amount and quality of information available to all market participants; strongly reduced information asymmetry: price + cost transparency
Mass personalization and customization; possibility for (almost) unlimited price discrimination

-> facilitates mass personalization and customization

Question 6

Reverse logistics is a term used to indicate that 3PL companies allow customers to track the delivery of goods.

True
False

Answer 6

False

Reverse logistics refers to the process of moving goods from their final destination back to the manufacturer or a designated location for the purpose of returns, repairs, recycling, or disposal. It is essentially the reverse flow of products in a supply chain.

Tracking the delivery of goods, on the other hand, is typically associated with the forward logistics process, where goods move from the manufacturer to the end consumer. The tracking of deliveries allows customers to monitor the progress of their orders during transportation.

*3thd party logistics

Question 7

A shopping bot will usually combine multiple products and services in a package in order to obtain better conditions (e.g. price).

True
False

Answer 7

False
Een shopping bot gaat normaliter geen producten of diensten combineren. Dat doet een aggregator.

Question 8

When you analyze the strategic impact of the Internet on the basis of Porter’s five forces model, one typically finds that many industries are experiencing an increase in the threat from substitutes. This is due to the fact that technology in itself leads to more potential substitute products or services.

True
False

Answer 8

True

Question 9

A supermarket is an example of a brick-and-mortar company.

True
False

Answer 9

False

Bricks-and-mortar (or “old-economy”)
traditional companies based in physical world only eg. locaal supermarket, barber
Pure-play (or virtual) organizations
companies are engaged only in electronic commerce, eg. Netflix, Facebook and Google
Clicks-and-mortar organizations
some e-commerce activities, yet primary business in physical world, eg. Walmart

=A brick-and-mortar company refers to a traditional business that has a physical presence, such as a physical store, office, or facility.

Question 10

A typical dot-com company would rely on network effects to increase market share by spending a lot of money. Oftentimes, they focused on so-called mind-share, for instance by offering products almost for free in the hope of charging higher prices later.

True
False

Answer 10

True

Question 11

Disintermediation means that companies position themselves as new intermediaries in existing value chains. Typical examples are 3PL companies and shopping bots.

True
False

Answer 11

False
disintermediation: cutting out the “middleman”

Question 12

A channel conflict arises when a company has several different sales channels that are not aligned with each other.

True
False

Answer 12

True

Question 13

According to Gartner, digital business entails the creation of new business designs by

clearly differentiating the digital and physical world.
blurring the digital and physical world.

Answer 13

blurring the digital and physical world.

Question 14

Which statement is NOT CORRECT?

In E-logistics, typically small parcels with products are sent to many homes using third-party logistics suppliers such as DHL, FedEx, etc.

In traditional forms of business, large amounts of products or materials were sent to a few destinations, such as supermarkets or physical retailers.

Facilities for reverse logistics are needed in case a damaged or the wrong product is delivered which needs to be sent back.

In click & collect buying a customer configures his or her market basket online and then has it sent to his/her home address.

Answer 14

In click & collect buying a customer configures his or her market basket online and then has it sent to his/her home address; instead of having the items sent to their home address, they choose to pick up the items in person at a specified location

Question 15

The strategy of a company like Dell can be seen as a typical example of a successful disintermediation strategy. It has adopted a totally new value chain model via internet technology to deliver cheaper to end customers.

True
False

Answer 15

True

Question 16

The Internet

decreases switching costs in case you want to change for example your payment transaction processor from PayPal to Stripe or any other company.
increases switching costs in case you want to change for example your payment transaction processor from PayPal to Stripe or any other company.

Answer 16

decreases switching costs in case you want to change for example your payment transaction processor from PayPal to Stripe or any other company.

Question 17

The strategy of a company like Dell can be seen as a typical example of a successful reintermediation strategy. It has adopted a totally new value chain model via internet technology to deliver cheaper to end customers.

True
False

Answer 17

False; no bcs intermediare function is not shifted but removed withing dell

Question 18

An aggregator will combine multiple products and/or services in one package so as to be able to offer better conditions (e.g. price).

True
False

Answer 18

True

Question 19

E-commerce includes e-business.

True
False

Answer 19

False

E-commerce: process of buying and selling goods and services electronically
E-business: e-commerce + use of Internet and other digital technologies for performing business processes and coordinating with suppliers and partners

Question 20

Web shops provide a new sales channel that is typically cheaper than working through traditional distribution channels. This creates tensions between the different sales channels, which is what we refer to as a channel conflict.

True
False

Answer 20

True

Question 21

When you analyze the strategic impact of the Internet using Porter’s five forces model, one typically finds that the market power of customers is declining because of the lack of transparency.

True
False

Answer 21

False
he Internet typically enhances the transparency of information, giving customers more power in terms of knowledge, choices, and negotiation

Question 22

An important characteristic of e-commerce and e-business in general is the so-called reach: products and services can be purchased almost 24/7, from countless platforms and devices.

True
False

Answer 22

False
this is ubiquity

Question 23

For digital products or services,

very limited economies of scale can be realised.
nearly unlimited economies of scale can be realised.

Answer 23

nearly unlimited economies of scale can be realised.

Question 24

Which statement is NOT CORRECT?

A company makes maximum profit when it sets its production output to the level where the marginal cost meets the marginal revenue or market price.

In traditional (non E-business) industries, the marginal cost, such as the cost of producing an extra product or assembling an extra car, increases as the production capacity becomes stretched.

For digital products or services, most of the costs are variable costs and incurred late in the process.

For digital products or services, we almost have near-zero marginal cost.

Answer 24

For digital products or services, most of the costs are variable costs and incurred late in the process;
in the digital realm, the emphasis is often on upfront investment and fixed costs associated with creating the product or service.

Question 25

The universal standardization of internet technologies, among other things, is causing a sharp increase in the total number of end customers who can buy via e-commerce. We also call this the “reach” characteristic of e-commerce.

True
False

Answer 25

True; Reach relates to the total number of users or customers an e-commerce business can obtain. Using universal standards such as 3G, 4G, 5G, HTML 5 and HTTP, customers across the whole world come within reach. For companies, this implies lower entry and search costs.

Question 26

When you analyze the strategic impact of the internet on the basis of Porter’s five forces model, one typically finds that the rivalry between existing competitors in a certain market increases because of stronger pressure to compete on price (because of the information density), but at the same time there is also a moderating effect because the internet increases the sales market.

True
False

Answer 26

True; Typically, many online industries are characterized by high rivalry since many players can be involved.

Question 27

Pure play companies typically do not have physical locations where they sell products.

True
False

Answer 27

True

Question 28

Web shops provide a new sales channel that is typically cheaper than working through traditional distribution channels. This creates tensions between the different sales channels, which is what we refer to as a channel conflict.

True
False

Answer 28

True

Question 29

Which statement is NOT CORRECT?

To protect themselves, distributors or retailers may threaten with lockouts and no longer sell the products or services an E-commerce web site directly sells.

Since the internet provides an easy mechanism for direct interaction with the end consumer a channel conflict may arise which creates tension between different distribution chains for the same product or service.

One successful strategy to handle disintermediation could be channel cooperation.

Disintermediation typically occurs instantaneously.

Answer 29

Disintermediation typically occurs instantaneously;
The internet creates a disintermediation effect by cutting out the middleman
disintermediation is typically not instantaneous but occurs gradually. For disintermediation to be successful, it is important to placate partners in the distribution channel while taking steps towards the eventual demise of these relationships.

Question 30

Which of the following statements is NOT CORRECT?

With the introduction of the Internet, the bargaining power of the buyers is high.

With the introduction of the Internet, the bargaining power of the suppliers is low.

Many online industries are characterized by high rivalry since many players can be involved.

With the introduction of the Internet, the threat of substitute products is low.

Answer 30

With the introduction of the Internet, the threat of substitute products is low; high
threats from both on-line and off-line shops

Question 31

Which statement is CORRECT?

The dotcom bubble burst implied the failure of B2C altogether.

In the early days of E-commerce, a typical dotcom company relied on network economies to justify losing money to build market or mind share, through giving its product or service away for free hoping to eventually charge for it once it has accumulated a critical customer base.

B2B represents a very small share of the overall E-business revenue.

Amazon was founded after the dotcom bubble burst.

Answer 31

In the early days of E-commerce, a typical dotcom company relied on network economies to justify losing money to build market or mind share, through giving its product or service away for free hoping to eventually charge for it once it has accumulated a critical customer base; correct

A) some B2C adapted to the changing market conditions and continued to thrive.
C) B2B transactions typically represent a substantial share of overall e-business revenue. Many businesses engage in B2B e-commerce for purchasing raw materials, components, services, and collaboration tools. B2B transactions often involve larger volumes and higher values compared to B2C transactions.
D) Amazon went public in 1997, well before the dotcom bubble burst in the early 2000s. Amazon’s success and ability to weather the challenges of the dotcom crash played a significant role in shaping the future of e-commerce.

Question 32

The underlying idea of the sharing economy is to value

a) ownership of resources rather than access to them.
b) access to resources rather than ownership of them.
c) both ownership of and access to resources.

Answer 32

access to resources rather than ownership of them.

Company does not make/own products
Idea: Internet-enabled sharing
use of tech platforms to allow consumers to make unused resources (temporarily) available to other consumers
cars, bicycles, rooms, office space, money (peer to peer lending)
Airbnb, Uber

Question 33

An important challenge for traditional logistics is the need to deliver small parcels to a very large number of private addresses.

True
False

Answer 33

False bcs 3PartyLpgistics are used

Question 34

A supermarket is an example of a click-and-mortar company.

True
False

Answer 34

True; Clicks-and-mortar organizations
some e-commerce activities, yet primary business in physical world