Ultimately the use of multiple forecasting techniques serves to increase the knowledge of a market and minimize market entry risk.
How would you forecast sales force size in a specialized industry, for example, aircraft?
As the demand for aircraft is defined by a select set of customers who have highly specialized information needs, defining the sales force size for aircraft would be easily accomplished by looking at the average sales cycles in this specific industry (which happen to be quite long) combined with the project management skills necessary to ensure a design win. A design win is the event where the aircraft is designed into the broader program of an airline, or in the case of military aircraft, purchased by a branch of the Department of Defense. Taking the average length of sales cycles and the total population of potential customers for the specific aircraft, calculating the size of the sales force as a result would be possible. As aircraft are highly specialized, it would typically be a much smaller sales force than for other, more broadly sold products.
How would you use market research to estimate sales potential?
In defining the sales potential for...
First, it's critical to realize that not just a single research approach can be taken for determining the sales potential for a product or service. Instead, the secondary research necessary to first discover the known causal relationships in a marketplace that impact sales need to be determined. From this knowledge, creating a series of primary research programs to measure demand for a product, quantifying the sales potential can be completed. Interviewing potential prospects through a variety of interviewing techniques including in-person interviews, mail-based surveys, or Internet-based surveys are all viable options. In addition, the use of Jury of Expert Opinion and focus groups are also viable approaches to gaining insights into what level of demand exists for a product. In addition, measuring the sales trending of substitute and competitive products can also yield significant insights into the sales potential for a new product. The bottom line is that multiple approaches to measuring sales potential need to be used if an accurate sales forecast is to be generated.
