138: Causal and Consumer Factors Fuel Demand Forecasting
To achieve growth, companies strive to predict what consumers are likely to do both now and in the future. According to Lance Goodridge, Circana’s executive vice president of analytics and insights, optimal forecasting will fit with current performance, include appropriate and predictable causal factors, and be within the bounds of company objectives. No small feat.
- While there will always be unpredictable situations, the right mix of causal factors, including inflation, weather patterns, and finance rates, along with consumer behaviors, can lead to sound demand forecasts.
- Accurate forecasts can help companies make decisions about investments in innovation, assortment, and production levels.
- What spurred demand in the past, like a promoted price, might not work as well in the future. Knowing the shopping journey can help determine specific purchase influencers.