Chapter 3: End-of-Chapter Questions

1. Electronic commerce in its narrow sense includes linkages between the firm and its suppliers and customers.

2. Barriers to electronic commerce are high costs, security concerns, and immature or unavailable software.

3. Business intelligence consists of information that describes the firm’s environmental elements.

4. Business intelligence has a wider scope than competitive intelligence, by including information on more than the firm’s competitors.

5. Primary data is data that the firm gathers itself; secondary data is gathered by someone else.

6. Selective dissemination of information makes the distribution of business intelligence efficient.

7. Government Web-based databases that would be especially helpful to marketers include the

Library of Congress (WWW.LOC.GOV) and the Census Bureau (WWW.CENSUS.GOV).

Marketers could seek information on customers and competitors. HR could use a government database to keep current on laws and regulations that relate to HR.

8. Vendors of commercial databases make their products available for free (with a limited amount of information and analysis) or for a fee.

9. Firms in an IOS are called trading partners or business partners. The leading firm is the IOS sponsor.

10. Vendor stock replenishment is accomplished by enabling vendors to monitor the inventory balances of its customers so that the stock can be automatically replenished. The firm’s security can be compromised when vendors have access to the firm’s inventory records.

11. Electronic funds transfer accomplishes the transmittal of funds from one organization to another.

12. The applications of level-three EDI users are tailored to the EDI technology, whereas those of level-two and level-one are geared to converting paper documents to electronic documents.

13. Direct benefits are improvements in the firm’s operations. Indirect benefits are made possible by the direct benefits.

14. XML/EDI will allow firms to exchange information (file structure and large amounts of data) using web pages.

15. EDI adoption influences include competitive pressure, exercised power, internal need, and top management support.

16. A common carrier serves as the vendor when direct connectivity is the electronic commerce technology.

17. A VAN vendor provides such services as mapping software, maintenance of logs and archive files, assistance in trading partner training, and security.

18. The Internet is the data communications network; the World Wide Web is a method for storing documents and retrieving them by means of the network connections.

19. A location on the WWW is called a Web site. The material that is made available is called the Web page.

20. A browser is a means of retrieving documents from the WWW by providing search parameters.

21. In order to use FTP or Gopher you need to know the URL of the Web site where the needed file is located.

22. Packet-filtering firewalls and circuit-level firewalls rely on hardware devices. Application-level firewalls rely on a combination of hardware and software.

23. Intranet is a use of the Internet for internal communications within the firm. Extranet is a use of the Internet for communications with such selected entities in the firm’s environment as trusted business partners.

24. Industrial marketing firms engaging in marketing research can obtain information on their customers from the Internet.

25. Marketing stands to gain the most from the Internet since the firm’s customers can use it to order the firm’s products. A new communications channel is opened between the firm and its customers and the channel provides a good way to gather information on customers and their needs.

Topics for Discussion

1. Just like any other tool or technology, the information superhighway is not inherently bad. Bad things can happen through misuse. If the computer industry does not police the use, the government will likely step in, driven by social pressure, and make restrictions.

2. Viewers will return to home pages when the pages are interesting, change frequently, provide an opportunity for interaction, and offer something in the way of a reward.

3. Retailers who market such electronic products as computer games, CD-ROMs, and software can handle the promotion and distribution through the Internet. The retailer with a product that can be delivered electronically is in the best position to utilize the Internet.