Ask a store manager to predict sales and they might err on the side of caution, hoping for an achievable target. Ask the marketer and they may just optimistically inflate demand to boost the campaign budget.
As a result, demand plans are often based on widely-differing figures.
This failure to achieve internal integration and departmental collaboration, say analysts, hinders data sharing and collaboration with external trading partners.
'We've heard a lot of frustration on how to manage subjective forecasts from our user groups,' says JD Edwards product marketing manger for demand management Lynne Taylor. 'So we've developed Demand Consensus, which uses a forecasting competency index (FCI) to learn which people provide the most reliable forecasts and then applies a weighted average to these predictions to create a consensus view.'
The system can be linked to existing Excel spreadsheet applications and is Web-based, so individuals can simply key in their forecasts to the Demand Consensus application over the Net. The product then uses exception analysis to identify differences of opinion and reconcile the predictions, using the FCI.
Demand Consensus incorporates technology from demand management specialist Demantra, which is adding response to 'causal variables' into its demand management model. The company's Marketing Mix Management product, due for launch at the end of the year, adds price and revenue optimisation into the forecasting process and can be used on a weekly basis to modify plans based on sales figures and changing events.
US department store chain, Macy's using HAHT's iChannel suite to improve demand management for luxury brands on its Web site, found that over six months, sales of luxury brands via the Web increased by 6,000 per cent.
Around two-thirds of this was attributed to Clarins, which had used HAHT to route customer queries seamlessly back to its own Web site. Consumers were thus able to order a wide range of products not usually offered by Macy's, and Clarins' response to this demand had improved product availability and increased sales.
'Orders were fulfilled directly by Clarins with Macy's given a commission on sales, although customers thought they had never actually left the Macy's site,' says HAHT managing director Steve Ashurst. 'Macy's has now implemented iChannel with all eight of the brands in its luxury selection.'
Contacts: Demantra - 0118 955 8214;
HAHT - 01483 243539; JD Edwards - 0118 909 1700.