Forecasting volumes for trade promotions in CPG industry using market drivers

International Journal of Business Forecasting and Marketing Intelligence 01/2009; 1(2):139-152. DOI: 10.1504/IJBFMI.2009.028453
Source: RePEc

ABSTRACT Promotions are an integral part of the consumer packaged goods (CPG) industry. Anywhere between 30-40% of the sales volumes are achieved through various promotions. Promotions are instrumental in creating brand visibility and awareness. In this study, we attempt to analyse the impact of promotions with feature advertises, in-store display, temporary price discounts etc. Five different multivariate regression models have been developed to forecast the total sales of a product considering pricing and distribution variables. The performance of these models has been analysed by using syndicated data. Based on the results, it is found that the S-shaped (double-log) model has shown superior performance over the other models considered in this study.

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