Promotional Examination and Forecasting for Demand Planning: An acceptable Time Series Approach Dissertation

Promotional Evaluation and Predicting for Demand Planning:

An affordable Time Series Approach

Eileen Leonard, OBSTACLE Institute Inc.

Cary, NC, USA


Many businesses use sales special offers to increase the need for or perhaps visibility of the product or service. These promotions often require improved expenditures (such as advertising) or loss of revenue (such as discounts), and/or extra costs (such as improved production). Business leaders ought to determine the significance of previous or perhaps proposed marketing promotions. One way to evaluate promotions is to analyze the historical info using period series analysis techniques. Especially, intervention examination can be used to unit the traditional data considering a past promotion. This type of promotional research may help determine how past promotions affected the historical sales and can help predict just how proposed special offers may impact the future based on similar, earlier promotions. This kind of paper in brief describes involvement analysis, gives practical tips for advertising analysis and forecasting applying interventions, and demonstrates these practices applying SAS/ETS В® Software.


Promotional Analysis, Demand Preparing, Forecasting, Involvement Analysis, Period Series Evaluation, ARIMA

1 .


Businesses need to program how they will certainly generate and satisfy demand for their products and services. Revenue promotions certainly are a vehicle through which businesses boost the demand for and visibility with their products and/or services. These kinds of promotions have a price and these kinds of costs should be justified simply by structured evaluation. Additionally , recommended sales promotions affect foreseeable future demand, thus increased resources must be invested in satisfy the offered demand. With all the advent of e-commerce, customer expectations are much higher than in the past. Therefore , if a organization promotes a product or service, it is expected to provide these in a well-timed fashion.

Organization leaders often ask the next questions: Was obviously a past promotion successful? Will certainly a suggested promotion always be profitable? How can demand be affected by a planned promotion, which can be similar to a previous promotion? These are generally questions that the paper hopes to help response. 2 .


The topic of advertising analysis means different things to different people. This kind of paper only considers service or product promotions which is why sufficient historical data are present. This daily news presents a methodology for examining and predicting promotions based upon promotions that contain occurred in the past in either the product or service beneath analysis, or a similar products or services whose underlying time series process shows similar real estate in response to (similar) marketing promotions. This newspaper will not solution the inquiries of who have should be targeted for a advertising, where should certainly a promotion end up being advertised, neither other such specific issues outside of the scope of traditional time series evaluation. These types of queries may be better answered using data exploration techniques (Berry and Linoff 1997) just like cluster research or memory-based reasoning (although the time series analysis approaches described from this paper might also be useful in these types of analyses). In addition , this daily news will not addresses promotions associated with products or services that contain no historical data (new products). Cool product forecasting and promotional evaluation may be better addressed using diffusion modeling (Parker 1994), surrogate merchandise analysis (Parkoff and Crowler 1999), judgmental techniques (Wright and Goodwin 1998), and other new product studies (Thomas 1993). Also, this kind of paper will never address the questions of price and promotional elasticities. These examines are better addressed simply by pricing designs (Foekens ou al.

1994), shrinkage estimation techniques (Blattberg and George 1989), and also other econometric building (Foekens ainsi que al. 1994).

Although the opportunity of this newspaper is rather limited with respect to total issues related to promotional research, the techniques described here may...

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Blattberg, R. C. and George, E. My spouse and i. (1989), " Shrinkage Estimation of Value and Marketing Elasticities, ”

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Box, G. E. P, Jenkins, G. M., and Reinsel, G. C. (1994), Time Series Examination: Forecasting and Control,

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Foeckens, Elizabeth. W., Leeflang, P. S. H., and Wittink, G. R. (1994), " An evaluation and a great Exploration of the

Forecast Accuracy and reliability of a Loglinear Model for Different Degrees of Aggregation, ” International Record of

Foeckens, E. W., Leeflang, G. S. L., and Wittink, D. Ur. (1999), " Varying Unbekannte Models to

Accommodate Active Promotion Effects, ” International Journal of Forecasting.

Fuller, W. A. (1995), Summary of Statistical Time Series, New York: John Wiley & Sons, Inc.

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