Know-How Exchange : Advertising/PR

hi there

how to forecast the impact depends on what kind of promotional activity you have in mind. the objective of the promotional campaign, advertisement will decide the tools to forecast the impact.

if your advertisement or promotion is geared to increase sales the you can use the following is the basic and some ways to forecast the effectiveness.

Advertising/promotional Campaign Performance, RESULTS = ROI + REVENUE

#1. Projected sales and profit generated by the campaign against the projected cost of the campaign or advertisement.
#2. the projected ratio of Increment in sales and the advertising expenses for the campaign or advertisement.
#3. the projected ratio of profit from and the cost of the campaign compared to the same ratio of before the campaign.
#4 Expected Brand awareness of your brand after the campaign as opposed to before the campaign or advertisement.

hope this helps.

cheers!!

There are a lot of variables you'll need to take into consideration, and it's not a perfect science under any circumstances.

The best way to start is to develop a trend line of historical shipments/sales by product by area. Compute seasonality or other data "glitches," until you can explain the majority of deviations from the trend line.

The underlying assumption is that if you do the same things you've done in the past, the adjusted trend will continue into the future. (Of course, if you're in rapid growth mode, the trend will level off at some point ...)

Then you can forecast the future, based on a projection of the past, and add/subtract the anticipated effects of your promotion effort. If you have test experience in one or two markets, you can make the assumption that the universe will respond like the test markets, and that will give you a starting point for making the adjustments.

I know this doesn't really do justice to the analytics involved, but you should get the idea from this. If you are in a consumer products category, you might be able to get more help from AC Nielsen or Information Resources (IRI). They both do a lot of work in analytics for consumer packaged goods, evaluating the impact of advertising and promotion, pricing, market-level activity, competitive promotions, etc. They can also measure and track performance in major retail outlets and distribution segments.

Hope this helps a little.