Real-World Education for Modern Marketers

Join Over 600,000 Marketing Professionals

Start here!
Text:  A A
Forecasting Guide
Overview
Categories
Selecting the Approach
Combining Approaches
Judgmental Models
Delphi Method
Curve Fitting
Analogous Data
Time Series Models
Moving Average
Exponential Smoothing
Decomposition Models
Box-Jenkins Models
Regression
Leading Indicator
Input-Output Models
Technique #3: Technological Forecasting by Curve Fitting

OVERVIEW: Curve Fitting is actually a set of techniques particularly appropriate for very new technologies with little or no data, or very long range forecasting. These are highly exploratory methods and large errors are quite likely.

BASIC IDEA: With a few data points, subjective and freehand extrapolation of data. Curve fitting is done to approximate the basic trend so that by extrapolating the trend, a forecast can be made.

PROCEDURE: The simplest curve to fit to a few data points is a straight line. The forecaster then interacts with this type of mechanical extrapolation to incorporate technical judgment in order to make a forecast. Note that the use of a straight line implies that the overall trend would increase indefinitely. Nevertheless, a simple linear trend may be quite reasonable, especially when looking at a class of technologies.

EXAMPLE: An example of using a simple (linear) trend extrapolation is shown below for forecasting the areal densities for computer rigid disks. Note that such a simple trend cannot be extrapolated indefinitely because the curve would increase to infinity. Thus, theoretical limits of the technology would suggest that the trend will have to bend a some point.

 

Article continues below

Another type of trend is an S-Shaped Curve.

 


Sign up for MarketingProfs Today ... it's FREE!

Get our best marketing tips daily—just enter your email address below to subscribe!

Bookmark and Share

Search over 4,000 MarketingProfs Resources!  

Subscribe Today

IT'S FREE! Become a member to get the tools and knowledge you need to market smarter.

we respect your privacy.

Stay connected!

Don't miss a bit of MarketingProfs ... join the 600,000 marketers following us.

Most Popular

Just Released ... Download Today!

Just Released ... Download Today!
Look inside

MarketingProfs Today

Get new marketing updates delivered to your inbox! Sign up for MarketingProfs Today for FREE!


Get to the Po!nt Newsletters

Bite-sized topic-specific newsletters on B2B Marketing, Content Marketing, Email Marketing, Search Engine Marketing, Small Business, Social Media and more. Sign up for one, two or all...for FREE!


Subscribe Today



MarketingProfs uses single
sign-on with Facebook, Twitter, Google and others to make subscribing and signing in easier for you. That's it, and nothing more! Rest assured that MarketingProfs: Your data is secure with MarketingProfs SocialSafe!