CEC E-commerce Strategy & Planning 3 — Questions and Answers
Question 1: An e-commerce brand's gross margin is 60% but net margin is 2%. Which area should the consultant investigate FIRST?
- Product pricing
- Operating expenses and overhead costs (Correct answer)
- Return on ad spend
- Website conversion rate
Correct answer: Operating expenses and overhead costs
A large gap between gross and net margin signals excessive operating costs such as fulfillment, staffing, or software eating into profitability.
Question 2: Which framework helps prioritize e-commerce growth initiatives by evaluating Impact, Confidence, and Ease?
- SWOT analysis
- ICE scoring (Correct answer)
- Balanced Scorecard
- Porter's Five Forces
Correct answer: ICE scoring
ICE scoring ranks initiatives by multiplying Impact, Confidence, and Ease scores so teams focus on high-value, low-effort experiments first.
Question 3: A brand sells B2B and B2C through the same platform. What is the primary strategic risk of this approach?
- Increased server load
- Pricing conflict and channel cannibalization (Correct answer)
- Higher SEO competition
- Slower checkout times
Correct answer: Pricing conflict and channel cannibalization
Exposing wholesale B2B pricing alongside retail B2C pricing can undermine retail margins and create conflicts with reseller partners.
Question 4: What is the strategic purpose of a product catalog audit in e-commerce planning?
- To speed up website load times
- To identify underperforming SKUs and rationalize the assortment (Correct answer)
- To set up automated reorder points
- To configure product schema markup
Correct answer: To identify underperforming SKUs and rationalize the assortment
A catalog audit reveals SKUs that drain logistics and merchandising resources without proportional revenue contribution, enabling smarter assortment decisions.
Question 5: Which growth strategy involves selling existing products to new customer segments or geographies?
- Product development
- Market penetration
- Market development (Correct answer)
- Diversification
Correct answer: Market development
Market development (from Ansoff's Matrix) expands reach by targeting new demographics or regions with the current product line.
Question 6: A consultant recommends an omnichannel strategy. What is the core benefit compared to multichannel?
- Lower SKU count
- Unified customer experience across all touchpoints (Correct answer)
- Reduced return rates
- Faster product development cycles
Correct answer: Unified customer experience across all touchpoints
Omnichannel integrates inventory, data, and messaging so customers experience seamless consistency whether shopping in-store, on mobile, or via chat.
Question 7: When building an e-commerce business plan, what does a 'unit economics' analysis primarily evaluate?
- Warehouse square footage per SKU
- Profitability of a single transaction or customer (Correct answer)
- Number of SKUs per category
- Website uptime percentage
Correct answer: Profitability of a single transaction or customer
Unit economics measures contribution margin per order or LTV minus CAC per customer to determine whether the business model is inherently profitable at scale.
CEC E-commerce Strategy & Planning 3
An e-commerce brand's gross margin is 60% but net margin is 2%.
Which area should the consultant investigate FIRST?