ESSAY QUESTION:
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."
Discuss how well reasoned you find this argument. Point out flaws in the argument's logic and analyze the argument's underlying assumptions. In addition, evaluate how supporting evidence is used and what evidence might counter the argument's conclusion. You may also discuss what additional evidence could be used to strengthen the argument or what changes would make the argument more logically sound.
YOUR RESPONSE:
The author talks about a promotional price reduction on energy drinks produced by the firm. He mentions that the dramatic increase in sales of the energy drinks was due to a price reduction. He states the results of a survey that reinforce the cause of the increase in sales. The author wishes to implement the same strategy on other drinks produced by the firm. According to him, the implementation of this such a strategy would be extremely profitable and would enhance the firm's perception in the eyes of the consumer.
The author's first assumption is that if a certain strategy worked well for a particular product, the same strategy, if implemented, will work on other products as well. The author believes that if the prices of the other drinks produced by the firm are reduced, there will be an increase in sales of these drinks. This speculative opinion is based on the increase in sales of the energy drinks produced by the firm. The author is of the opinion that the success enjoyed by the firm on the increase in sales of the energy drinks will be emulated.
A second assumption is predicting consumer's behaviour. Consumers may not react the same way they did with the promotional price offer of the energy drinks. The reduction in prices of the other drinks may not have the desired effect. The consumers may have genuinely liked the energy drink, and hence may have purchased more of it in the promotional price period. The consumers may or may not like the other drinks produced by the firm as much as the energy drink.
The argument does have its merits such as providing the results of the survey, which strengthens the author's strategy, but consumer behaviour cannot be predicted beforehand. Thorough research needs to be conducted in order to understand what might help increase the sales of the other drinks produced by the firm. Implementing the same strategy that worked for one product may not work for another product.
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."
Discuss how well reasoned you find this argument. Point out flaws in the argument's logic and analyze the argument's underlying assumptions. In addition, evaluate how supporting evidence is used and what evidence might counter the argument's conclusion. You may also discuss what additional evidence could be used to strengthen the argument or what changes would make the argument more logically sound.
YOUR RESPONSE:
The author talks about a promotional price reduction on energy drinks produced by the firm. He mentions that the dramatic increase in sales of the energy drinks was due to a price reduction. He states the results of a survey that reinforce the cause of the increase in sales. The author wishes to implement the same strategy on other drinks produced by the firm. According to him, the implementation of this such a strategy would be extremely profitable and would enhance the firm's perception in the eyes of the consumer.
The author's first assumption is that if a certain strategy worked well for a particular product, the same strategy, if implemented, will work on other products as well. The author believes that if the prices of the other drinks produced by the firm are reduced, there will be an increase in sales of these drinks. This speculative opinion is based on the increase in sales of the energy drinks produced by the firm. The author is of the opinion that the success enjoyed by the firm on the increase in sales of the energy drinks will be emulated.
A second assumption is predicting consumer's behaviour. Consumers may not react the same way they did with the promotional price offer of the energy drinks. The reduction in prices of the other drinks may not have the desired effect. The consumers may have genuinely liked the energy drink, and hence may have purchased more of it in the promotional price period. The consumers may or may not like the other drinks produced by the firm as much as the energy drink.
The argument does have its merits such as providing the results of the survey, which strengthens the author's strategy, but consumer behaviour cannot be predicted beforehand. Thorough research needs to be conducted in order to understand what might help increase the sales of the other drinks produced by the firm. Implementing the same strategy that worked for one product may not work for another product.
