New Product Forecasting Issues Kenneth B. Kahn, Ph.D. The University of Tennessee Department of Marketing and Logistics 315 Stokely Management Center Knoxville, Tennessee 37996-0530 (865) 974-2609 kkahn@utk.edu

New Product Forecasting Issues Low accuracy (high forecast error) Low credibility Limited amount of data available for analysis Inability to fully capture market complexity, cannibalization, market penetration rate, etc. Limited amount of time for analysis

New Product Forecast Accuracy Source: Kenneth B. Kahn, Journal of Product Innovation Management, March 2002 Cost Reductions

Some Keys to New Product Forecasting Success There is no silver bullet when it comes to new product forecasting. New product forecasting success is a result of data, experience, cross-functional communication, business knowledge, and being connected to the customer. Use a toolbox approach when applying new product forecasting techniques. New product forecasting requires reconciliation of multiple techniques based on judgment and analytical skills. New product forecasting is a process of assumptions management. Think in terms of ranges, not specific numbers.

Course Agenda New Product Forecasting Issues and Considerations Judgmental Approaches for Forecasting New Products Customer- and Market-Research Based Techniques Quantitative Approaches for Forecasting New Products Managing the New Product Forecasting Process