The following appeared in the opinion column of a financial magazine:
“On average, middle-aged consumers devote 39 percent of their retail expenditure to department store products and
services, while for younger consumers the average is only 25 percent. Since the number of middle-aged people will
increase dramatically within the next decade, department stores can expect retail sales to increase significantly
during that period. Furthermore, to take advantage of the trend, these stores should begin to replace some of those
products intended to attract the younger consumer with products intended to attract the middle-aged consumer.”
Answer:
The argument claims that since middle -aged people spend more at departmental stores than younger consumers, replacing these stores with some products relevant to middle age consumers will bring considerable benefits to the departmental stores. Thre are serious flaws that needs to be fixed inorder to validate this argument.
Firstly, the argument assumes that the number of middle aged people will increase within the next decade. This fails to mention the key factors on the basis of which it could be evaluated. There is no evidence stated in the passage which says the middle aged number is going to increase in the coming years. Even if the middle aged population was to increase , it may have very well be in par with the younger people population which would have increased too. Hence replacing the store products with products pertaining to middle aged people cannot increase the product sales. Infact this would attract middle aged people at the cost of losing younger customers. This is a compromise and risk that retail stores usually would not encourage.
If the argument had provided evidence that middle aged number was going to be increasing much more in comparion to younger people in the next decade, then the argument would have been lot more convincing.
Secondly, replacing the products to concentrate on middle aged people will create a sort of bias among customers and this inturn will lead to customers prefering stores that do not have such restrictions. For instance the people visiting a retail store will usually do so with there family members or friends who may or maynot be from the same age group. So if a younger person shops with a elder person, then they both will have different product needs and they will therefore prefer a place which caters to both their requirement than just one person's.
Thirdly , when a store concentrates on a particular customer group, it may catch the eye of their immediate opponent stores who can take this business style for their advantage by introducing more schemes for both younger and elder population. For eg. say there are two stores in close proximity. A and B both are in operation for about 20 years, have great reputation. Each has its own share of customers. Assume A has introduced 10 products for middle aged alone. B on the other hand has increased products for both Younger and middle aged . In this case B will catch the eye of customers from store A too, as they get more options and choices to choose from. This would decrease rather than increasing the store sales.
Hence, without convincing answers to these questions, the conclusion is unconvincing.