GMAT Essays (AWA)

The following appeared in a corporate memorandum of a beverage manufacturer:

"Our promotional price reductions on energy drinks have been highly successful, as we have seen a dramatic increase in unit sales. Further, surveys of our consumers indicate that this promotion was favorably received by the majority of our customers. Therefore, to improve our company's profitability and enhance its perception in the eyes of consumers, similar price reductions should be offered on all drinks produced by our firm."





Providing price reductions to its customers during the Promotional season is a big tool used by companies to access the knowlegde about how its product is working in the consumer market. These promotional offers are generally preffered by companies during a new product launch but many times older products are also given for promotional prices in order to enhance the company's image in the eye of its customers and capture a large market.

In the above arguments the author has stated that the promotional price reductions on the energy drinks was a big success for the brand with a huge increase in the unit sale price. The survey was conducted by the company officials also in order to understand the consumer's point of view about the promotion that had a positive result from consumers side. Hence taking all the above points into consideration the author is of the conclusion that in order to increase the profitability and customer's perception for the brand the company should reduce the price for all drinks produced by the firm. The author's conclusion may seem to be obvious at first glance, but a closer look reveals that the arguments are not only flawed but also unconvincing and non persuasive.

Firstly, The authors has stated that Promotional Reduction on energy drinks have been a great success and hence the firm should allow for a reduction in price for all the drinks its offers. There is shift in the author's scope of argumentation. The price reduction and the suceess of Enery drink does not guarantee the same success for the other beverages of the firm. The author has just generalised his point of view from a small sample set to a big sample which may or may not be true. The author's conclusion is not all without sustance regarding this point but from the arguments it is difficult to draw this conclusion. It can so happen that the energy drink was actually liked by the custoemrs of the firm and hence a price reduction actually spawned its sales but the firm's other beverage may not be famous among its consumers. Hence aprice reduction does not guarantee an icrease in sale and profit.

Next, the author bases his conclusion for price reduction on the basis of the survey that was conducted by the firm and had a positive result. But it has not been mentioned by the author that the survey was actually a representative of the customers it actually covered. It could have be that the survey was just conducted at a college campus or a at a particular area or Locality. the author has not given enough information for the readers to assume that the survey was from a representative set.

Moreover , the last point which the author has talked about is the profitability of the company. IF there is a price reduction then how is the profit increased that correlation is not explained by the author. If the author could have given more idea about his plans about the increase in profit with a decrease in reduction his point could have been well justified.


In summary, the author's argumets are not convincing and persuasive. If the author could have thrown more light on the above foresaid point then not only his arguments would have been bolstered but it could have been persuasive. In absence of these the author's argumeents and premises fall apart for the consclusion as it stands.