Chapter 10

Broadly speaking the definition of price includes all of the following accept:
physical cost
This refers to the idea that both buyers and sellers can view all competitive prices for items sold online.
Price transparency
All of the following are cost savings enjoyed by shoppers online except
shipping costs are reduced
the phenomenon that some people may actually pay a higher price for auctioned products than they would pay an online retailor
The winners curse
This power is based largely on the huge quantity of information and product availability on the Web
Buyer Power
This is the most common profit-oriented objective for pricing
Current profit maximization
Which of the following attributes puts upward pressure on pricing
all the above
-online customer service
-affiliate programs
-customer acquisition cost (CAC)
Which of the following internet attributes puts downward pressure on pricing
Self-service order processing
All of the following are types of markets recognized by economists except
oligopolistic monopoly
A market is truly efficient when customers have equal access to information about
all the above
This refers to the variability of purchase behavior with changes in price
Price elasticity
Which of the following are possible explanations of online price dispersion
All the above
-delivery options
-time-sensitive habits
-switching costs
Which of the following is true in regard to electronic money
Both b and c
-it has been widely adopted in other countries(not U.S)
-also called e-money or digital cash
In general marketers can employ which of the following types of pricing strategies both online and offline
all the above
-fixed pricing
-auction pricing
-dynamic pricing
2 types of fixed pricing strategies
Price leadership and promotional pricing
This pricing uses the internet properties for mass customization, automatically devising pricing based on the size and timing, demand and supply levels, and other preset decision factors
In order to avoid upsetting customers who learn they are getting different prices than neighbors, e-marketers should use customer accepted reasons. These reasons may include
all the above
-giving discounts to new customers
-giving discount to loyal customers
-adjusting shipping fees due to outlying locations
When using this? segment pricing, a company may set different prices when selling a product in different states or regions.
geographic segment pricing
This suggests that 80% of a firm’s business typically comes from the top 20% of customers
The Pareto principle
Which of the following customer group is least valuable to a seller
Buyer power on the internet is the result of all the following except:
product costs
Companies select market-oriented pricing on the internet to
grow market share