for CPG Brands
CONNECTING PROMOTIONS AND A SALES FORECAST
Strategies for New Product Forecasting
Forecasting the demand for new products is a pivotal yet challenging task for many consumer brands.
At this point, you (hopefully!) feel like you've got a good grasp on forecasting sales and forecasting trade promotions. But how do you forecast net new products?
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Identify products with similar features, target markets, or that have been launched in similar market conditions.
Analyze their sales performance, considering seasonality, marketing efforts, and distribution channels.
Adjust the data to reflect the unique aspects of the new product.
Utilize surveys, focus groups, and market analysis to gauge consumer interest and willingness to purchase.
Study market trends and competitor activities to identify gaps the new product can fill.
Analyze the data to estimate the market size and potential market share.
Define clear objectives and KPIs for the launch, aligned with the overall business strategy
Create a cross-functional launch team with representatives from marketing, sales, supply chain, and finance to ensure alignment and collaboration
Develop a comprehensive launch plan, including timelines, budgets, and responsibilities for each team member
Prepare a go-to-market strategy, outlining the target market segments, positioning, pricing, and distribution channels for the new product
Create compelling marketing and sales materials, such as product demos, brochures, and sales scripts, to support the launch
Train the sales team and distributors on the new product's features, benefits, and target customers to ensure effective communication and sales efforts
Coordinate with supply chain partners to ensure adequate inventory levels and streamlined distribution for the launch
Plan and execute a launch event or campaign to generate buzz and interest among the target audience
Launch a pre-sale or crowdfunding campaign, highlighting the unique value proposition of the new product.
Monitor the volume of pre-orders or crowdfunding support as an immediate gauge of consumer interest.
Adjust production and distribution plans based on the outcome of the campaign.
Start with a price based on cost-plus or competitive pricing strategies.
Experiment with different pricing levels in various markets or channels to gauge consumer response.
Use the collected data to refine pricing and forecast demand more accurately.
Build strong relationships with suppliers for rapid response to production changes.
Implement just-in-time manufacturing practices to align production closely with demand.
Use demand forecasting insights to inform suppliers and logistics partners of potential demand changes.
Set up real-time sales tracking and reporting systems.
Analyze early sales data to identify trends, making adjustments to forecasts as needed.
Collect and analyze customer feedback for insights into product reception and potential improvements.
Monitor sales performance, comparing actual sales to forecasted demand and identifying any deviations or trends.
Analyze customer feedback, reviews, and social media sentiments to gauge consumer reception and identify areas for improvement.
Conduct post-launch market research to assess the product's market share, competitive landscape, and customer satisfaction levels.
Adjust marketing and sales strategies based on the insights gathered, such as refining the target audience, optimizing pricing, or expanding distribution channels.
Collaborate with the supply chain team to optimize inventory levels and production schedules based on actual demand patterns.
Continuously update demand forecasts based on real-time sales data and market insights, ensuring alignment across all functions.
Identify opportunities for product improvements or line extensions based on customer feedback and market trends.
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By leveraging analogous product data, conducting thorough market research, employing predictive analytics, and remaining flexible in response to early market signals, CPG brands can navigate the uncertainties of new product launches more effectively.
These strategies not only aid in forecasting but also in creating a responsive and agile operational framework that can adapt to the realities of the market post-launch.
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The Future in Focus: The Role of Tools and Data in CPG Forecasting
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