Demand Analysis & Sales Forecasting Dr. Dawne Martin Business Marketing October 11, 2011.
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Transcript of Demand Analysis & Sales Forecasting Dr. Dawne Martin Business Marketing October 11, 2011.
![Page 1: Demand Analysis & Sales Forecasting Dr. Dawne Martin Business Marketing October 11, 2011.](https://reader035.fdocuments.net/reader035/viewer/2022081821/56649e165503460f94b01b40/html5/thumbnails/1.jpg)
Demand Analysis & Sales Forecasting
Dr. Dawne Martin
Business Marketing
October 11, 2011
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Administrative Things
Exam 2, October 27 Part III of Project Due 10/31 For next time: Chapter 6 & 7
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Market Segmentation Approaches
What are the criteria for a good market segment?
What are the primary bases of segmentation used in B2B marketing?
When are they used? How is the market segmented in your
industry?
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Types of Forecasts
Sales Forecast
Market Potential
Industry Sales
Sales Potential
Market Forecast (Market Demand)
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Questions
Why do we need to estimate market demand?
What are the uses for sales forecasts? Why is it important that they are as accurate as possible?
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Examples of Forecasts Used in Business Marketing
Sales Management Decisions
Assessing market opportunity & allocating resources
Evaluating competitive performance
Planning for manufacturing and inventory
Assessing the size of the sales force
Type of Forecast
Market potential & market forecast
Sales potential
Sales forecast
Sales forecasts
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Forecasting Approaches: Top-Down
Forecast of general economic & business conditions for country
Market potential for relevant industry
Factors affecting company’s share of total industry sales
Sales potential for company as % of industry sales
Company sales forecast
Zone, region, district, territory & account forecasts
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Forecasting Approaches: Bottom-Up
Sales person’s forecast of accounts
Combined into territory forecasts
Combined into District, Region, Zone forecasts
Company Sales Forecasts
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Determining Market & Sales Potential
Statistical Series Assumes there is a good relationship between demand
and statistical series Example: # employees and number of uniforms
Single Series Method Based on NAICS or market segments Steps
Select Statistical series Relate series to demand through usage factor Estimate series for desired time period Potential = usage factor X value of series for year
Multiple Series Methods – for more complex demand Multiple regression techniques
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Determining Market & Sales Potential Market Research
Uses Estimate demand from few buyers Estimate demand for new products Supplement data from statistical series
Methods Surveys – Institute for Supply Chain Management
Manufacturing -- http://www.ism.ws/ISMReport/MfgROB.cfm?navItemNumber=12942
Non-Manufacturing -- http://www.ism.ws/ISMReport/NonMfgROB.cfm
Focus groups Customer visits
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Forecasting Methods:Association/Casual & Time Series
Association/Causal Correlation Regression Models Leading Indicators
http://www.newyorkfed.org/research/national_economy/
Econometric Models Input-Output Models
http://www.bea.gov/industry/
Time-Series Moving Averages Exponential Smoothing Adaptive Filtering Time-Series
Extrapolation Times Series
Decomposition Box-Jenkins
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Forecasting Methods: Judgement & Counting Methods
Naïve Extrapolation Sales Composite Jury of Executive Opinion Scenario Analysis and Sensitivity Analysis Delphi Technique Historical Analogy Counting Methods
Market Testing Market Survey
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Summary
Demand Analysis (Market Potential) and Sales forecasts are used throughout the organization
Choosing a forecasting technique is based on: Who and how it will be used Time frame Data available Costs/Benefits
Various methods may be used, but should combine top-down & bottom- up
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Problem
Biomedical researchers at a Midwest medical school notes that jaundice is seen in approximately 60 percent of infants. To quickly diagnose the problem, the researchers have developed a device that provides a one-handed test for jaundice. A key benefit from the product is for dark-skinned infants. How would you assess the market potential for this product?