CTE 3809 Trend Analysis and Forecasting Spring 2013 Review for Exam III Ch 8 Consumer Research Consumer anthropology Methods originally used by anthropologists to study primitive tribes or subcultures have been adapted to study consumer s and buying behavior Helps companies understand motivators within a product category Mall intercept research market research conducted for a client using consumers recruited from shoppers in a mall who satisfy the requirements of clients Qualitative research an approach to research based on ethnography case studies and phenomenological studies in which human experiences are observed in a natural setting and described or explained using the natural setting and described or explained using the natural setting and described or explained using the natural language categories and frameworks of the subjects Quantitative research an approach to research that uses experimental methods or surveys to collect data on a sample in order to generalize finding to a population Showcase or laboratory stores stores where mega niche and lifestyle brands can present their entire line as a billboard for the brand an educational environment for retailers on the latest in visual merchandising and a research site for gathering intelligence about what consumers want which products in the line are heating up and which cooling down and which packaging and promotional initiatives are most effective Test store specialty store chains selling store labels designate certain stores as test sites Test merchandise group a less extensive approach is to plant test groups of merchandise Style testing pretesting styles with consumers to identify winners and losers early enough in the product development cycle to enable styles with low consumer interest to be eliminated from further development Ch 9 Sales Forecasting Automated replenishment system a collaborative effort between a retailer and a manufacturer involving vendor designed assortment plans and automatic shipping to keep stock at optimum levels Category management a collaborative strategy between a retailer and a manufacturer in which the manufacturer acts as a specialist in forecasting keeping the right flow of merchandise going to the selling floor provides expertise in a category including trends silhouettes and finishes and makes recommendations on merchandising assortment display and inventory controls in that product category on a store by store basis Consumer confidence an index of consumer feelings of economic well being used to predict future consume expenditures and turning points in the business cycles The Consumer Confidence Index CCI the Conference Board The Index of Consumer Sentiment ICS the Survey Research Center at UM Indexes of consumer confidence o Highlight the relationship between economic conditions and consumer behavior Correlation or regression techniques statistical techniques for comparing how a change in one variable causes a change in another variable 1 How is sales volume related to a promotion or advertising campaign How is decreasing consumer confidence related to sales volume As consumers get older how do their purchasing patterns change Data mining the ability to search through vast stores of data to answer complex business questions discover patterns in databases and predictive information that lies outside experts expectations Data Mining A Step Toward Real time Marketing Uses statistical techniques and visualization to reveal relationships that can be used in decision making and forecasting Data warehouse a warehouse for storing and delivering massive quantities of data Fixed model time series FMTS a set of statistical techniques that begins with the idea that the forecast for next month s sales is the average of all past sales Open model time series OMTS techniques that first analyze the time series to determine the components then build unique models and forecast the time series into the future Product life cycle a series of predictable stages from the development of a product until it disappears from the marketplace Sales forecast a projection of expected demand given a set of environmental conditions which is developed using quantitative and qualitative methods Sales Forecast Projection of expected demand given a set of environmental conditions o Specific time horizon o Updated quarterly Sales Plan a plan that defines goals and provides motivation for sales levels that meet or exceed the sales forecast Sales Plan Managerial strategy to meet exceed the sales forecast Who needs access to the sales forecast o Marketing managers o Sales managers 2 o Financial managers o Production managers o Distribution managers Making a sales forecast requires o Internal data on sales volume and marketing o Future plans for marketing and product distribution o External data on market information and cultural indicators Seasonality in time series forecasting a yearly pattern of increasing or decreasing sales that corresponds to the season Time series techniques quantitative techniques that use values recorded at regular time intervals sales history to predict future sales levels Time Series Forecasting o Open model time series OMTS o Fixed model time series FMTS Ch 10 Competitive Analysis Benchmarking in competitive analysis comparing a company with other firms considered to be the best in terms of efficient operations Competitive advantage the situation in which for a period of time there is an asymmetry in the marketplace that favors one company over another Competitive analysis competitive intelligence the process of using public sources to develop a detailed and accurate view of the market environment both trends in the industry and what the competition is likely to do Content analysis a method of analyzing information involving extracting significant data from source material classifying it and noting patterns and regularities in the data 3 Direct competitors competitors that sell the same general product to the same customers in the same distribution channels Indirect competitors companies that do not sell the same or similar products but offer alternatives that may redirect a customer away from a purchasing situation Industrial espionage information gathering activities that involve breaking the law to collect competitive data Reverse engineering a way of gaining competitive information by purchasing and dismantling a product to determine how it was designed and constructed Secret shopper a person