ATAR Forecast Example for a Small Business
In this ATAR forecast example, we will consider a small business. In this example, there is a coffee shop in a local area. Their new product is a service – they plan to … Read more...
Category: ATAR
Understanding the Financial Metrics
Understanding the financial metrics
As you will see when you use the free Excel template for your ATAR forecasts, there are several financial metrics automatically produced at the bottom of the spreadsheet.
As you can see, these financial metrics include:… Read more...
How the ATAR Forecasting Model Works
What is the ATAR forecasting model?
The ATAR forecasting model is primarily designed to forecast sales and profit contribution of new products following its initial years of release/launch.
In most cases, in addition to achieving their strategic goals, firms will … Read more...
Prices, costs, margins and purchase quantity
Prices, costs, and average purchase volume
The core component of the ATAR model is designed to generate the estimation of the proportion of the target market to become ongoing loyal or occasional customers = the brand’s customer base.
Once we … Read more...
STOP: ATAR reality checks!
Nothing destroys the credibility of a business report faster than inaccurate or wildly optimistic financial forecasts. I have seen students provide financial forecasts of a product line extension that would generate billions in dollars within a couple of years. And … Read more...
Most ATAR factors are interrelated
Interrelated ATAR factors in the forecast
Possibly one of the more troublesome issues to consider when using the ATAR model for forecasting new products is how the four basic components – awareness, trial, availability and repeat/rebuy – impact each other.… Read more...
Product cannibalization in the ATAR forecast
Product cannibalization in the ATAR forecast
Product cannibalization is when the firm’s new product “wins” a proportion of its sales (market share) from the firm’s other existing products – that is, the new product “eats away” the market share of … Read more...
Increasing trial rates
What drives trial levels?
There are numerous factors that will impact the percentage of consumers that trial a product, which marketers can influence and drive. Some of the factors to take into account include:
- Is this a product line extension?
Improving awareness
Because of the nature of the structure of the ATAR forecasting model, the marketing department will become accountable for delivering the various ATAR components if the new product is approved for development and launch.
This means, therefore, if you have … Read more...
Do I need to use the financial metrics?
Do I need to use the financial metrics?
As you will see when you use the free Excel template for your ATAR forecasts, there are several financial metrics automatically produced at the bottom of the spreadsheet.
As you can see, … Read more...
Importance of financial forecasts in the new product decision
How important are the financials in the overall NP decision?
The ATAR financial forecasting model for new products is simply one of the areas of evaluation for the go/no-go decision on whether or not to develop the product and take … Read more...
Limitations of ATAR forecasting
Limitations of the ATAR forecasting model
While there are numerous benefits of using the ATAR forecasting model for new products and marketing, there are also some limitations and cautions that you need to be aware of when using this approach.… Read more...
Benefits of the ATAR forecast model
Why use the ATAR forecasting model for new products?
Obviously there are many ways of approaching a financial forecast. However, the ATAR forecasting model is one that is explicitly designed for marketing purposes. So let’s explore the key advantages and … Read more...
Rebuy/repeat in the ATAR forecast model
Repeat/rebuy in the ATAR forecast
I tend to use the terms repeat purchases or rebuy interchangeably on this website, as they essentially communicate the same intention. Out of the four ATAR components, this one is the most important and the … Read more...
Availability in ATAR Forecasts
Availability in the ATAR forecasting model
Availability refers to the extent that the new product is available to consumers through retailers, various direct channels and online.
Put simply, it is a measure of the ability of consumers to purchase the … Read more...
Trial in the ATAR Forecast
The T in the ATAR forecasting model stands for trial.
What is a trial?
A trial in marketing terms may mean slightly different things at times; therefore we need to clarify what is a suitable input into the ATAR model.… Read more...
ATAR Variations: Different Business Models
The standard ATAR forecasting model relies upon all four elements of the ATAR components, namely: awareness, trial, availability and repeat/rebuy.
But it is quite likely you will need to use a modified ATAR model because of the different business models … Read more...
Awareness in the ATAR Model
Understanding Awareness in ATAR
The starting point of the ATAR forecasting model is A = Awareness.
This is a measure of what proportion (percentage) of consumers (or other buying units) will become aware of the product – whether or not … Read more...
Videos on the ATAR Forecasting Model
Please note that there are three videos below:
- How to use the ATAR template on this website
- How to build your own ATAR forecast model on Excel
- Understanding financial metrics for marketing
ATAR Theory
Welcome to the theory section of the ATAR forecasting model website.
In this area of the website, you’ll find general articles relating to using the ATAR model and its structure. Please click here for more information on the formula/technical parts… Read more...