Transcript Measuring Forecasting Market Demand

Measuring & forecasting
Market Demand
• Market is the set of all actual & potential
buyers of a market offer.
• Market estimation involves understanding
of key terms like Market potential,
company demand & sales forecast.
• Market : only refers to a set of existing &
potential buyers of a product/service.
• Potential Market: This is a set of
consumers who have interest in
marketers offer.
• For eg the potential market for luxury
homes are all consumers in the high
income & rich segment.
• Target Market:-This is also called served
market & refers to the market segment
which a firm chooses to serve.
• Eg:of Target Market is In case of luxury
homes,a builder may choose to target
Young professionals in Major cities who
have resources or access to resources.
• Market Penetration: In the above e.g. this
refers to the set of consumers in the target
market who have bought luxury homes.
Market penetration ratio refers to the total
number of such consumers to the total
number of consumers in the target market.
• Market Potential : The forecasting
exercises involve understanding Market
potential. Consider the example of a
product such as a TV set-To estimate the
market potential for TV sets in India,we
have to know no of Households.
• Assuming that each household will have
a TV Set, We can say that the market
potential for TV sets is equal to=The no of
house holds in the country..
• Three aspects involved in defining Market
potential:
a) Defined market environment.
b) Marketing expenditure by the industry
c) Market Demand
Market demand:
It refers to the total volume that would be bought
by a defined customer group in defined
geographical area in a defined time period in a
defined marketing environment under a defined
Marketing Programme.
Tools for estimating Future Market Demand:
There are two kinds of tools that one can
use to estimate market demand .
One is qualitative (mainly surveys)
& the other quantitative.
Qualitative tools:
Involve opinion surveys
Some of the more prominently used ones
are described as follows:
• Survey of Buying Intention:
• This involves surveying the buyers to
assess their intentions to buy the
products.
• This is very useful in estimating the market
demand for consumer durables or even
a new product .The purchase intention of
the buyer can be measured on a scale
• For e.g:
• Definitely buy
• Definitely not buy
• Composite of sales force opinion:
• In this method ,the company asks
individual sales personnel to estimate
sales of the given product in his territory.
• This estimates are then pooled and a
national level forecast of sales is obtained.
• Delphi Technique:
• Involves constituting a panel of experts &
asking them to estimate the market
demand for a given product.
• They are also asked to mention their
assumptions about the future market
environment.
• Individual experts do not know who else is
on the panel. since each expert works
from his or her office, the chances of him
or her getting influenced by others does
not arise.
• Once the marketer gets the estimates ,he
or she isolates extreme opinions &
estimates & reverts back to the concerned
expert, giving them the assumptions which
others have made.
• This method can study different scenarios
& is particularly useful in estimating
demand for a new product or technology.
Second method is quantitative
techniques
• In that we have
• 1.Tools for short term forecasting
• 2.tools for long term forecasting.
The End