New Product Forecasting Issues

1. 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

2. 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

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

4. 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.

5. 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 Course Agenda