Snazzy Sodas Is Known for Its Variety of All-Natural Sodas

question 24

Multiple Choice

Snazzy Sodas is known for its variety of all-natural sodas as well as its efforts toward social responsibility. The company has decided to produce a new line of energy drinks, and while it does not have the resources to promote its product widely, it can make a sizeable impact with a carefully chosen market segment. The CEO favours marketing the product primarily to young males, but the VP of operations recommends targeting female professionals. Which of the following, if true, would support the CEO's position?

• A) Snazzy decided that producing a line of energy drinks would be more profitable than attempting to penetrate international markets.
• B) Young males, as a group, consume more energy drinks than any other market segment.
• C) Energy drinks cost more per ounce than other popular beverages.
• D) Energy drink manufacturers have recently tried to associate their product with positive social causes.
• E) Different companies define "young" differently.

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Definitions:

Vertical Contracts

Agreements between companies at different levels in the supply chain, such as between a manufacturer and a retailer, aiming to increase efficiencies and reduce costs.

Costly Activities

Actions or endeavors that require significant expenditures of resources, such as money, time, or effort.

Supply Chain

A system of organizations, people, activities, information, and resources involved in moving a product or service from supplier to customer.

Double Marginalization

A situation in a supply chain where both the manufacturer and the retailer mark up prices, leading to higher costs for consumers.