Please evaluate my essay.
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01 Aug 2014, 02:42
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.
The given argument asserts that recent promotional price reductions on energy drinks have been highly successful and have led to an increase in sales, and thus such price reductions should be offered on all drinks manufactured by the firm. The author is certain that this would not only bring in better profits, but also enhance the perception of the firm in the eyes of its consumers. The argument as it stands, lacks logical reasoning and is based on a couple of erroneous assumptions.
Firstly, the author has not provided any background information to the reasons for the recent promotional price reductions on energy drinks. Has the firm introduced a new variety of energy drinks into the market? Is the price reduction a seasonal decision, something energy drink manufacturers often give along side major sporting events? Were there new stores or vending booths opened as part of the advertisement strategy for the energy drink, which has allowed consumers to have better access to the drink as opposed to earlier? It is very likely that such external factors played a crucial role, along with the reduced prices to boost sales of the given energy drink in question. Also, it is possible that while the strategy worked very well in its initial phase, it may not work out very well on a long term basis.
Secondly, in order to back claims of a well received promotional campaign, the author mentions that a recent survey of consumers indicated that the campaign was favorably received by a majority of customers. No more details are provided about the survey - namely, the age group targeted by the survey, the time frame in which the survey was conducted as compared to the time during which the promotional campaign ran, the total number of participants in the survey etc. Without these details, it is preposterous to conclude that consumers would continue buying the said energy drink in the future, ensuring consistent high number of sales.
Lastly, the argument concludes with the author urging the firm to offer promotional price reductions on all drinks, to enjoy high profitability and enhance the company's perception in the eyes of its customers. This assertion is unfounded, because the results of a promotional campaign that ran for a energy drink, cannot be applied to all other types of drinks manufactures by the firm, simply because it may cater to a whole different segment of consumers to begin with. Also, it is very likely that constant price reductions offered on multiple products manufactured by the company, may hurt the company's image and reputation instead of enhancing it because consumers may jump to the plausible conclusion that the company's drinks are not being sold and hence it has had to resort to slashing prices. Additionally, offering too many discounts may actually add up to be a loss for the company, as compared to offering only a few discounts.
In summary, the arguments made by the author are not convincing and further proof, including a detailed assessment of the consumer market, present and past sales of each different kind of drink manufactured by the company and the overall company budget, will be required to come up with future promotional campaigns.