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A restaurant that comes up with an innovative dish can normally increa

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A restaurant that comes up with an innovative dish can normally increa  [#permalink]

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New post 30 Sep 2017, 12:17
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A
B
C
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E

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Question Stats:

47% (01:32) correct 53% (01:50) wrong based on 298 sessions

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A restaurant that comes up with an innovative dish can normally increase its profits by capitalizing on the novelty of the dish. Since recipes can be easily replicated, the restaurant with a new dish advertises it aggressively to attract customers while the novelty factor can still be used as a selling point. But aggressive advertising generates a fear of losing customers in the competitors and gives them a strong incentive to quickly replicate the new dish. Therefore, the strategy to maximize overall profit from a new dish is to advertise it selectively.

Which of the following, if true, strengthens the suggestion given by the author?

A) The patrons of a restaurant are the ones who are most likely to try a new dish at the restaurant.
B) The word of mouth publicity generated by the customers of the restaurant is a good enough reason for the competitors to replicate the dish.
C) The recipes for the innovative dishes are usually kept under close guard by the restaurants that develop the dishes.
D) Aggressive marketing usually generates far more profits than does selective marketing.
E) Selective marketing has been proven to be an effective strategy for fast food restaurant chains.

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Re: A restaurant that comes up with an innovative dish can normally increa  [#permalink]

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New post 05 Oct 2017, 05:13
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Im super confused. I can’t see why A works. I chose E, given fast food restaurants are different in their menus and target selective tastes (Taco Bell vs Burger King). Can someone please explain why A works? Appreciate the help.

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Re: A restaurant that comes up with an innovative dish can normally increa  [#permalink]

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New post 05 Oct 2017, 06:45
Need explanation on A ...On a first go , i eliminated the choice :o
argument is all about marketing ..and it is written in argument , new dish normally produces profits...
Even if most of them try new dish , what about marketing effect on profit ....
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A restaurant that comes up with an innovative dish can normally increa  [#permalink]

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New post Updated on: 05 Oct 2017, 12:48
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I went with A for the following reason

1. Patrons or regular customer will try a new dish, this means the new dish will sell generating money without serious advertisement hence won't allow the competitors to copy the dish. This will result in revenue growth without the fear of losing customers to competitors .

Originally posted by Turkish on 05 Oct 2017, 07:51.
Last edited by Turkish on 05 Oct 2017, 12:48, edited 1 time in total.
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Re: A restaurant that comes up with an innovative dish can normally increa  [#permalink]

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New post 05 Oct 2017, 08:41
bkpolymers1617 wrote:
A restaurant that comes up with an innovative dish can normally increase its profits by capitalizing on the novelty of the dish. Since recipes can be easily replicated, the restaurant with a new dish advertises it aggressively to attract customers while the novelty factor can still be used as a selling point. But aggressive advertising generates a fear of losing customers in the competitors and gives them a strong incentive to quickly replicate the new dish. Therefore, the strategy to maximize overall profit from a new dish is to advertise it selectively.

Which of the following, if true, strengthens the suggestion given by the author?


A) The patrons of a restaurant are the ones who are most likely to try a new dish at the restaurant.
Correct. Advertising selectively to the patrons of a restaurant seems to help the restaurant not only keep the new dish secret but also maximum the revenue.

B) The word of mouth publicity generated by the customers of the restaurant is a good enough reason for the competitors to replicate the dish.
This choice weaken the argument. This choice indicates that even if the restaurant chooses to advertise selectively,
the dish is still replicated easily.


C) The recipes for the innovative dishes are usually kept under close guard by the restaurants that develop the dishes.
This choice is irrelevant to the argument.

D) Aggressive marketing usually generates far more profits than does selective marketing.
Same as C

E) Selective marketing has been proven to be an effective strategy for fast food restaurant chains.
"effective strategy" is irrelevant here. The argument focuses on replicating dish only.
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Re: A restaurant that comes up with an innovative dish can normally increa  [#permalink]

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New post 05 Oct 2017, 09:20
syedazeem3 wrote:
Im super confused. I can’t see why A works. I chose E, given fast food restaurants are different in their menus and target selective tastes (Taco Bell vs Burger King). Can someone please explain why A works? Appreciate the help.

Posted from my mobile device


I didnt choose E because I thought that the selective strategy that works for 'fast food restaurant chains' need not necessarily work for all restaurants (or even standalone fast food restaurant).

Pls correct me if my approach/thought is incorrect.
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Re: A restaurant that comes up with an innovative dish can normally increa  [#permalink]

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New post 05 Oct 2017, 12:12
I eliminated E over A because it talks about "Fast Food" Resturants - which is not necessarily stated in our question.
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Re: A restaurant that comes up with an innovative dish can normally increa  [#permalink]

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New post 09 Oct 2017, 06:06
deepeshagarwal101 wrote:
I eliminated E over A because it talks about "Fast Food" Resturants - which is not necessarily stated in our question.


Yes that seems to be a valid reason to eliminate option E .. I also eliminated E because of this reason..
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Re: A restaurant that comes up with an innovative dish can normally increa  [#permalink]

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New post 30 Oct 2018, 02:12
Ⓒ to maximize profit ← restaurant needs to advertise selectively ⟷ otherwise competitors will replicate the new dish → restaurant will loose customers → can't maximize profit

Ⓐ find link btw selective advertising & profit max.
If restaurant finds its target group successfully → can maximize its profit
If there is a statistical data proofing that selective advertising leads to profit max → supports the Ⓒ

A) The patrons of a restaurant are the ones who are most likely to try a new dish at the restaurant. - sounds like a narrow target group → if the restaurant finds the target of its selective marketing → can maximize profit
B) The word of mouth publicity generated by the customers of the restaurant is a good enough reason for the competitors to replicate the dish. - aggressive marketing → competitors replicate dish → loosing customers → statement doest support any way that selective marketing will help improve profit
C) The recipes for the innovative dishes are usually kept under close guard by the restaurants that develop the dishes. - passage doesn't state that competitors need the recipes to replicate the dish
D) Aggressive marketing usually generates far more profits than does selective marketing. - generalization and do not support selective marketing→ profit max
E) Selective marketing has been proven to be an effective strategy for fast food restaurant chains. - selective marketing=efficient in fast food restaurants → restaurant of the passage can maximize its profit as well by using selective marketing? sounds good, but we don't know if the restaurant is a fast food restaurant. The given criteria is too narrow
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Re: A restaurant that comes up with an innovative dish can normally increa &nbs [#permalink] 30 Oct 2018, 02:12
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