1. Strategic Tools & Forecasting

2. Profit Impact of Marketing Strategy (PIMS) Cross-sectional study of the strategic experience of profit organizations based on the experience of more than 500 companies in nearly 3,800 businesses. Can use the information to develop a model to estimate a business’s ROI from the structural competitive/strategy factors associated with the business. Some of Buzzell and Gale’s strategy principles based on PIMS research: –Quality is the single most important factor affecting performance –Larger market share equals higher ROI –High investment intensity pulls down profitability –Forecasts of cash flow based solely on the growth-share matrix are often misleading

3. Trend-Impact Analysis A method for projecting future trends from information gathered on past behavior. 1.Use computer to extrapolate past history. 2.Have experts indicate future events that may have a bearing on the trend and use this information to modify the extrapolation. 3.Have experts review the modified extrapolation and adjust where necessary.

4. Cross-Impact Analysis Provides a future forecast, making due allowance for the effect of interacting forces on the shape of things to come.

5. Survey of Buyer Intentions Ask individual accounts about their purchasing plans for a future period and translate these responses into account forecasts. –Mail surveys –Telephone surveys –Personal interviews, etc.

6. Jury of Executive Opinion Experts in the firm provide forecasts. The forecasts are then averaged or discussed by the manages until a consensus forecast for each account is reached.

7. Delphi Technique Method of making forecasts based on expert opinion. 1.Identify recognized experts (e.g., company executives) in the field of interest. 2.Seek their cooperation and send them a summary paper o the topic being examined. 3.Conduct personal interviews with each expert based on a structured questionnaire.

8. Salesforce Composite Method Salespeople provide forecasts for their assigned accounts.

9. Moving Averages A forecast is developed by calculating the average company sales for previous years.

10. Decomposition Method Breakdown previous company sales data into four major components: trend, cycle, seasonal, and erratic events. These components are then reincorporated to produce the sales forecast.

11. A Basic Approach to Sales Forecasting Total number of people in target markets [a] a Annual number of purchases per person [b]x b Total potential market [c]= c Total potential market [c] c Percent of total market coverage [d]x d Total available market [e]= e Total available market [e] e Expected market share [f]x f Sales forecast (in units) [g]= g Sales forecast (in units) [g] g Price [h]x h Sales forecast (in dollars) [i]= i