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" In these types of organizations where only a few large customers are served, predicting sales based on first-hand knowledge of the customers can be an effective forecasting method.
A survey of customers involves asking customers about their future intentions. One of the benefits of this method is that it allows for an overview of all customers, rather than focusing on several select customers. The second benefit is that it gains information by going directly to the buyer. This method is best used in markets where consumer behavior and consumer perceptions drive the market (Neal, Quester, & Hawkins 1999, p. 1.5). This includes the fashion industry, the entertainment industry, as well as many service industries.
The historical analogy method is based on recognizing that similar products will often follow similar growth patterns. This method is used to predict the future sales of new products. This method is best used in industries that are introducing completely new products. The two main examples are the electronics and computer industries. This method is best used for completely new products because the other methods often cannot produce accurate predictions for a product that has no past sales history. In these cases, considering how a similar product sold...
This includes considering the consumer, competitors, market conditions, and any other aspect that will impact the sales of the product. The advantage of this method is that it takes into account all the factors that will impact sales, that it provides a more accurate forecast, and that it takes into account changes in the environment or in consumers. These aspects make the method most useful for organizations operating in highly competitive markets, especially markets where the actions of the competition have a significant impact on sales. These aspects also make the method most useful for organizations operating in rapidly changing markets. Finally, the method is best used when it is essential to have an accurate sales forecast.
References
Baker, M.J. (1999). The IEBM Encyclopedia of Marketing. London: International Thompson Business Press.
Neal, C., Quester, P., & Hawkins, D. (1999). Consumer Behavior: Implications for Marketing Strategy. Boston, MA: Irwin/McGraw-Hill.
Perreault, W.D., & McCarthy, E.J. (2000). Essentials of Marketing. Boston, MA: Irwin/McGraw-Hill.
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