Question

Industry market potential is an estimate of the likely sales for all companies in a specific industry during a particular period. Managers use various methods to estimate industry market potential. There are at least six methods for a manager to gather the information. Use THREE (3) methods that are used by these international managers.

Answer 1

Managers use different ways to consider industry market strength.
It includes different techniques of analogy, proxy indicators, chain ratio method, time series analysis, and multiple regression modeling.
The main three methods that are used by these international managers to estimate industry market potential:-
1.Analogy:-
When using the analogy method, the researcher creats on known statistics from one country to gain insights into the same situation for a similar country.
2.Proxy indicator:-
Indirect measure or sign that approximates or represents a situation in the absence of a direct measure or sign. For example, Number of female members of an advertisement industry, is a proxy indicator of the percentage rate of female business managers. It is also called indirect indicator.
3.Chain ratio indicators:-
The chain ratio method helps to predict how much money require to spend to meet your marketing targets. The chain ratio method explains by multiplying a base number of a chain of related percentages. While it is only an predict of the market potential, it can actually paint quite an accurate picture.