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Rafael AlemanMKTG353

October 25, 2012Notes

Remember from last class:

At end of this week she will be sending the study guide

You will be tested how to do sales goal for new product in new marketPractice Orange.Hands on using Excelno substitute for practice

If youre not getting the same answers as her make sure you go to her office to review.

November 3Product Camp Extra Credit. Attend Lectures.

Reason you get BPI is how to allocate marketing resourcesBudget, marketing budget, advertisisng budget, sales reps and resource allocation

Buying Power Indexgood marketing can exceeed marketing demand

How can you come up with the importance weight?

BPI- REG.xlsYou had to find market demand and find info on Census: Population, income and retail sales.We worked on it last week. You must practice to recall immediately

Affect Product and its salesX1 Population %X2 Income % Product Sales YActual SalesX3 Retail Sales %

Time affects Sales

X Y

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In exam you have to first find your X variable and Y variableDaraData AnaluysiRegresision

Reading material about this part (Summary Output)Sales planning and forecasting on Page 3 and page 6Read for the Final Exams

Multiple RR Square (Multiple R squared) Proportion that the variables are responsible for change in sales (Pop

%, Income and retail sales). Its a good model since its 99.28%

(0.992876)

ANOVAAnalysis of VarianceWe focus on column F (Significance F= 0.01066712) 1% chancethat none of these factors affect the sales of Y. That 1% is wrong, somodel is good.

The importance is the coefficients.What does a 1 in column E mean? 1 percent of the total populationWhat does 28.91 mean in the Actual Sales? 1 means $1,000 in sales

1% increase of total pop will increase the sales by 28.91*($1,000)= $28,9101% increase in income of total market will decrease the total of our product by -2.107*(1,000)=

$2,1071% increase in retail sales of total market will decrease the sales of our product by-$11,035= -11.035*(1,000)When peoples condition improve they buy something else so this is an inferior good.

Example: Some students drive a Honda Civic and when they make more money they will get an Audi,Honda is not an inferior product but people buy higher with more income.

There are more stores in South Coast Plaza than in Mihaylo hall so a sausage sandwich will not be asappealing.

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The size of coefficient shows how large the impact is. Population is the most important, the second isretail and last is income.

Coefficient Weight basedon factors

29

2

11

42 100%

What does the p-value of 0.35313 mean? It means 35% chance that population has no effect on sales.

Now look at income, 85% chance that income has no effect on sales of product0.732498034 = 73% chances that retail % has no effect on our sales.

When p-value is too high (above 5%) we can make sample size bigger. It will minimize the effect of info

15 for every one factor. How can you get more data points? You can add more counties, and cities. Thiswill make model very stable. 45 will be really good (15 per each 1, 15*3)

Copy and paste

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What graph do we use when the information is not related?

What did we learn from exerciseWhat does the coefficient meanThe importance weightWe also learned regression predicted salesWe can compare absolute percentage error

We can compare historical accuracy.

What is the cyclical patternThe short term forecasting

Next week: Align marketing and the performance measure of align marketing.