In an effort to reduce the risks associated with new products, the forecasting of year-one sales has become an established practice within the marketing research industry. Despite many claims of high precision, forecasting sales of new products is fraught with risks, and estimates often are off the mark. The risk of great error is particularly high for new products that represent a paradigm shift. That is, something fundamentally new and different. The goal of this article is to take a bit of the mystery out of the methods used to derive year-one sales forecasts for new consumer packaged goods.
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