Perreault−McCarthy: Basic
Marketing: A
Global−Managerial
Approach, 14/e- Developing Innovative
Marketing Plans
Text © The McGraw−Hill
Companies, 2002614 Chapter 21
may even include details about what adjustments in the marketing mix or target
market will be required as the nature of competition and the adoption process
evolve.^4Forecasting Target Market Potential and Sales
Effective strategy planning and developing a marketing plan require estimates of
future sales, costs, and profits. Without such information, it’s hard to know if a strat-
egy is potentially profitable.
The marketing manager’s estimates of sales, costs, and profits are usually based
on a forecast (estimate) of target market potential—what a whole market segment
might buy—and a sales forecast—an estimate of how much an industry or firm
hopes to sell to a market segment. Usually we must first try to judge market poten-
tial before we can estimate what share a particular firm may be able to win with its
particular marketing mix.We’re interested in forecasting the potential in specific market segments. To do
this, it helps to make three levels of forecasts.
Some economic conditions affect the entire global economy. Others may influence
only one country or a particular industry. And some may affect only one company
or one product’s sales potential. For this reason, a common top-down approach to
forecasting is to- Develop a national income forecast(for each country in which the firm oper-
ates) and use this to - Develop an industry sales forecast,which then is used to
- Develop forecasts for a specific company,its specific products,and the segmentsit
targets.
Three levels of
forecasts are useful
A number of firms—including
ESRI and Third Wave Research
Group—now offer marketers
software or databases to help
them more accurately forecast
sales for specific market areas,
products, or segments.