The payoff for launching a successful product innovation can be huge. As shown by our research on breakthrough innovation, a new product can generate upwards of $50-300 million in new revenue for a brand. But innovation also requires a lot of resources and upfront investment, so it’s critical to understand early if an innovation will generate more than it costs. To help our clients better understand their innovations’ growth potential, our BASES innovation sales forecasting model combines consumers’ responses to new concepts and products with a manufacturer’s planned marketing to estimate future sales.
More than ever, companies need sales forecasting that’s trusted and reliable.
That’s why we’re excited to announce that our BASES forecasting model recently underwent the Marketing Accountability Standards Board (MASB) Marketing Metrics Audit Protocol, becoming the first and only forecasting model in the industry to undergo this accountability standard.
This audit—developed by MASB, an independent, cross-industry forum—has been recognized by the industry as the protocol and standard of measurement and accountability for all companies who connect marketing metrics to financial performance. MASB members include scholars from the nations’ top business schools as well as senior marketing, finance and analytics executives from Fortune 500 companies.
“While marketing has plenty of measures, it lacks standard metrics explicitly linked to financial performance in predictable ways,” said Margaret (Meg) Blair, CEO of MASB. “By completing the MASB audit, Nielsen has demonstrated its leadership in transparency and in helping marketing and financial executives come together to make confident investment decisions for their business.”
Nielsen’s BASES forecasting model helps clients grow through successful innovation on their brands, in connection with Nielsen’s strategy planning, concept optimization, new product testing and pack design and testing solutions. For 40 years, it’s been used by global CPG companies to prioritize initiatives, allocate marketing resources and plan manufacturing capacity based on the multi-year sales a new product is expected to deliver for the brand. Unlike other forecasting solutions, Nielsen uses its breadth of market data to calibrate its models and deliver more accurate forecasts. On average, Nielsen forecasts are within 9% of actual sales.
“Innovations require substantial capital investments for production and for marketing and you need very precise forecasts to make sure you will inevitably get the pay back you expect,” said Randall Beard, president of Nielsen’s Global Innovation practice. “Nielsen’s forecasts help companies establish an objective, independent way for all stakeholders to align and agree on the opportunity at hand, while giving marketers some early indication data to build a successful sell-in story for the trade. We’re honored to receive this distinguished recognition.”
Learn more about MASB.