DECA Retail Merchandising Practice Exam

Which of the following best defines service retailing?

1. Retailing that primarily sells tangible goods

2. Retailing that is characterized by providing intangible services

3. Retailing that does not allow customer interactions

4. Retailing focused solely on online transactions

The correct answer is: Retailing that is characterized by providing intangible services

Service retailing is effectively characterized by the primary focus on providing intangible services rather than tangible products. This form of retailing emphasizes the delivery of experiences, expertise, or direct assistance to customers, highlighting the value of the service being rendered. Examples include businesses like hair salons, banks, and repair shops, where the customer experience and the outcome of the service are the main offerings rather than physical goods. The defining feature of service retailing lies in its intangibility, as it often cannot be touched or owned in the same manner as a product. Services in retail can include activities that are time-sensitive and depend significantly on human interaction, such as personal consultations or professional services. Thus, the essence of service retailing is about creating value through experience, expertise, and customer relationships, rather than simply selling physical items.