The colours on this photo are remarkable. The photographer, Richard Droker, explains that the colour is nearly as it was in the field, but that he achieved his excellent focus through focus stacking using Zerene Stacker software. For more about this process, visit Richard’s original post.
Cladonia bellidiflora goes by the common name toy soldier, arising from the bright red apothecia (cup or saucer shaped fruiting body) that sit atop their podetia (stalk-like outgrowths). Like a tin soldier’s red hat, apothecia are all show and little purpose; they are reproductive structures that allow the fungus to disperse through spores, but for a lichen, this is not terribly helpful. Lichen reproduction requires that the fungus and alga disperse together, since most of the time, fungal spores don’t land close enough to an alga to form the symbiosis that results in a new lichen.
The most common way for Cladonia species to reproduce is likely through the breaking off of squamules, which are the leaf-like scales that you can see clearly in today’s photo. The squamules contain both fungi and algae, and when a squamule is carried to a suitable site–perhaps by animals, wind, gravity, or water–the lichen is able to regenerate and produce a new thallus, or main body. There are a number of other ways in which Cladonia bellidiflora and other lichen species can reproduce, and these are explained on the Images of British Lichens website. Interestingly, in any case, only the fungus in a lichen has the opportunity to reproduce sexually, as sexual reproduction of the algal partner is suppressed in lichens.