Market & Revenue Analysis and Forecasting

Market & Revenue Analysis and Forecasting features our customized service designed to maximize our clients' return on sales and marketing investments by helping them:

• Develop more fact-based, forward-looking market planning processes
• Evaluate key market drivers and trends in specific market segments
• Produce accurate, consistent forecasts for sales and revenue
• Benchmark performance and other vital targets
• Analyze forces of change
• Identify risk and success factors

IHS consultants deploy vast databases, proven analytical tools, and sophisticated methodologies to size markets, forecast product performance, analyze market segments and product penetration, and provide early warning market monitors.

Market & Revenue Analysis and Forecasting enables you to:

• Reduce operating costs through improved resource allocation
• Maximize revenue growth and minimize losses
• React more quickly than the competition to market shifts
• Gain new insight into market dynamics from an objective third party analysis

Market & Revenue Analysis and Forecasting

Client Challenge:

How can our company accurately forecast demand for our products or improve the inconsistency of our current forecasting process? How do we prevent supply overhang? Forecast demand for multiple products?

IHS Consultants can help you:

• Identify and quantify your key market drivers, in order to develop accurate sales forecasts and forward-looking, fact-based demand planning
• Gauge the impact of changes in the market drivers on your sales units and revenue
• Quantify the relationship between market factors and sales
• Estimate price elasticity of demand for specific products and services
• Determine the effects of technological change on underlying demand by product or service
• Identify the combined impact of unspecified factors on product or service sales
• Quantify the impact of advertising expenditures on sales

See Case Studies #1, #2, #3, and #4

Client Challenge:

Should we enter the East European market? China?

IHS Consultants can help you:

• Identify new and emerging markets
• Avoid poor performing markets
• Formulate improved investment plans and more realistic performance targets
• Understand the marketplace conditions awaiting your new international market teams

See Case Studies #5 and #6

Client Challenge:

How can we obtain an accurate estimate of our global market size, segmented by product, division, company, or world region? Prevent losses in market share? Decide where to investment based on greatest potential return?

IHS Consultants can help you:

• Size markets by product, region, country, industry, occupation, consumer cohort, business-size class, or other defined segment
• Build a custom market model using proprietary customer data
• Measure market penetration by segment or geographic area
• Target new markets
• Allocate sales and marketing resources
• Set performance benchmarks
• Create accurate sales forecasts and build targeted sales and production strategies
• Conduct "what if" scenarios among market segments to build a customized model to predict sales at the industry or company level
• Create realistic forecasts to anticipate production needs, manage inventory, plan staffing, inform capital investments, and build accurate sales plans
• Monitor market reports to anticipate risks and opportunities
• Forecast growth opportunities across 200 country markets

See Case Studies #7, #8, #9, and #10

Client Challenge:

Where can we find the cheapest supply of power? Should we undertake a pipeline expansion?

IHS Consultants can help you:

• Use our independent, data-based methodologies for identifying market trends, drivers, and future scenarios that directly affect your business
• Conduct strategic market and operations planning
• Craft market entry and exit strategies
• Provide analysis to support your investment decisions

See Case Studies #11 and #12

Client Challenge:

How do we monitor sales by individual, team, and territory? Are faster growing regions producing greater sales for our company than slower growing ones? Can we quantify the impact of key drivers within our sales forecasts?

IHS Consultants can help you:

• Assess sales performance relative to market size, segment, territory and growth
• Identify under- and over-served segments and sales territories
• Allocate sales and marketing resources effectively and efficiently to increase sales
• Set more equitable targets for all of your sales and distribution resources

See Case Studies #13 and #14

Market & Revenue Analysis and Forecasting Case Studies

Case Study #1: Fixing an Inconsistent Ad Hoc Forecasting Process

Challenge: A leading storage vendor required an accurate forecast model incorporating several product categories, industry sectors, and countries so that it could efficiently allocate sales and marketing resources.

Solution: IHS developed a comprehensive forecast that integrated demand drivers and demand validation metrics across multiple product categories, industry sectors, and countries. We combined a "corporate dashboard" with the model, which presented client-specified charts, tables, and monitoring graphics for key indicators and also served as the primary delivery vehicle for data, updates, and re-estimation.

Results: The model's consistent forecasting process allowed our client to better identify, analyze, and prioritize existing and emerging market opportunities. The client improved the allocation of its sales and marketing resources and gained deeper insight into multiple product lifecycles across industries and geographies.

Case Study #2: Forecasting Demand for Batteries

Challenge: A battery manufacturer needed a new approach to forecast battery market sales that took into account the complexity and linkages of its demand drivers. There was also a need to consider alternative planning scenarios on an ongoing basis.

Solution: IHS Consulting built the client a customized forecast model based on a thorough examination of business drivers.  Integral to the model's success was the careful incorporation of the linkages between demand for batteries and demand for products that use batteries. In addition, the model was delivered in a custom scenario planning software application.

Results: The client gained a more accurate forecast model that fully incorporated the complexity and detailed information about its demand drivers.  With the model delivered in an easy-to-use scenario planning software application, the client was able to contribute significantly to the organization's analysis around opportunity, risk, and contingency planning.

Case Study #3: Ensuring Adequate Supply without Inventory Overhang

Challenge: A construction equipment manufacturer needed to forecast production of its machinery by product line, in order to ensure adequate but not surplus supply to its dealers and to better manage the size of its manufacturing workforce.

Solution: IHS Consulting created a customized econometric model, incorporating critical demand and business drivers unique to each product line. The model also incorporated the relationships between product sales, construction activity by building type, and key economic factors.

Results: The product line construction equipment sales forecasts enabled our client to set factory schedules to maximize productivity and minimize inventory overhangs or shortfalls.

Case Study #4: Forecasting Demand for Multiple Technologies

Challenge: A major computer hardware company needed to size and forecast key markets for a dozen technologies by industry, business size, and geographic area in the United States.

Solution: IHS Consulting created a customized state-by-state segmentation model containing historical estimates and five-year revenue forecasts for each technology by industry, business size, and segment.

Results: This clearer, more accurate picture of revenue prospects allowed the client to evaluate market strengths and successfully target particular customers in specific segments and improve revenue growth.

Case Study #5: Should We Enter Eastern Europe?

Challenge: A refining and marketing company was considering entering the East European market and needed objective, quantitative support for its decision.

Solution: IHS Consulting conducted an analysis of the Eastern European refining and marketing business. The study included detailed supply and demand balances, and regional projections - including prices and margins and market and industry structure.

Results: The analysis highlighted the prospects for growth in selected Eastern European markets, noting the opportunities and risks facing companies interested in entering the various regional markets.

Case Study #6: Deep-Dive Evaluation of China's Semi-Durable Products Market

Challenge: A Semi-Durable products firm considering investing in China required a "deep-dive" understanding of the market before determining an entry strategy.

Solution: IHS Consulting compiled a comprehensive evaluation of the Chinese market, which included:

• A 15-year consumption forecast
• Tailored insights into economic, political, legal, tax, security, and operational criteria
• Primary research into targeted Chinese consumer category and channel purchase behavior and intent
• Key regional assessments to help target investments properly
• Retailer and channel dynamics to bring clarity to competitive positioning opportunities

Results: Our client received a customized "briefing book" suitable for executive decision-makers, and IHS also led a seminar with the client's executive management to facilitate fruitful discussion of the chosen strategy's implications. This gave the client compelling reasons to enter the market, along with the market knowledge to develop a successful entry strategy.

Case Study #7: Sizing the Rental Market

Challenge: A major trade association needed to determine the size of the equipment, tool, and supplies rental market, and be able to forecast future rental revenue and industry investment.

Solution: IHS Consulting compiled estimates of revenue and annual investment in rental inventory through 2008 and developed forecasts through 2013, based on the integration of public data, primary research, and our proprietary models of national and regional economies.

Results: The client received a customized forecast that provided industry benchmarks for further understanding and analysis of the rental industry's size, structure, and trajectory that could be used for its members' planning and investment needs and for informing government relations.

Case Study #8: Objective Assessment of Market Potential

Challenge: A rotary screw air compressor firm needed an unbiased assessment of its market potential - by building market segment and by geography - so it could set realistic sales goals for its territories.

Solution: IHS Consulting developed a market potential estimate by compiling construction investment data by building segment and usage factor estimates for the client's building products by structure type. We then forecasted sales for each product category - by building type and geography - by benchmarking the estimate against national industry sales. We extended our analysis to the county level.

Results: The client gained a customized forecast of market potential by county, enabling the company to reassign sales resources and set performance expectations based on market demand.

Case Study #9: Transforming Declining Market Shares into New Opportunities

Challenge: A large telecommunications service provider wanted to increase its share of new business customers in major markets in which its shares were falling.

Solution: IHS Consulting completed a custom analysis of business births and deaths, segmented it by industry and business size, and integrated this data with IHS detailed telecommunications market data to estimates telecom usage by new businesses.

Results: The client aggressively pursued areas of new business growth, targeted businesses in large and growing industries and size segments, and promoted appealing product packages to attract new business customers. The client increased its shares of new customers and increased profitability in the process.

Case Study #10: Setting Proper Investment Levels for International Markets

Challenge: A semi-durable products firm need an empirical, comprehensive assessment of which international market opportunities over a 10-to-15-year horizon would offer the greatest return on overseas investment dollars.

Solution: IHS Consulting, working in tandem with the client, developed a customized model that evaluated and scored global markets according to key business drivers.

Results: The client obtained both a rich storehouse of empirical country data and a flexible scoring tool for prioritizing investments based on highest return.

Case Study #11: Where Can We Find the Cheapest Power in the World?

Challenge: A global aluminum company needed to find low-cost electricity to support a new aluminum smelting operation.

Solution: A joint IHS-client team screened over 100 countries, using criteria such as potential delivered power prices for different technologies and fuels, the local business landscape, and potential synergies with the client's other global operations.

Results: The team created a prioritization list that enabled the client to garner senior management support to pursue the three top-ranked options.

Case Study #12: Should We Undertake a Pipeline Expansion?

Challenge: A major U.S. refined product pipeline company needed to make a strategic decision regarding the need for and timing of a major capacity expansion at a key bottleneck along the pipeline route.

Solution: IHS Consulting prepared a detailed regional analysis of the future market for refined products in selected target markets, including demand in all markets served by the pipeline and alternative sources of competing supply.

Results: The analysis indicated that owing to weak market conditions and changing product demand trends in the target market, the pipeline expansion was not an immediate priority, and the client adopted the recommendation that the expansion be deferred.

Case Study #13: Determining if Fast-Growers Make Better Performers

Challenge: A large telecommunications equipment manufacturer wanted to equitably gauge the performance of its sales teams by territory and by individual. The question was: Are territories and individuals with fast growth really performing better than those with slower growth?

Solution: IHS Consulting restructured its detailed ICT market data and forecasts to reflect the client's segments, regions, and territories. Then the client's sales growth data by territory and individual were compared to market growth for the territories and individuals.

Results: The analysis identified over- and under-achievers relative to the market benchmarks. Specifically, some fast growth sales territories and individuals actually increased their sales less than the market and lost market share, while some with slower sales growth actually grew more than market and gained market share.

Case Study #14: Sales Forecasts Built on Quantifiable Driver Impacts

Challenge: An appliance manufacturer needed to quantify the factors driving white goods sales across markets, so it could generate reliable forecasts - segmented by product categories - for use in its annual planning process.

Solution: After holding a "business drivers" workshop with the client, IHS Consulting built a customized forecast model that quantified the relationships between white goods sales and key driving factors (consumer spending, housing construction, turnover and renovation).

Results: The client now has a tool to generate forecasts for white goods sales across markets with a high degree of confidence.