Marketing Decision Models

Module-1: Marketing Analytics

In 2013, the total Indian sales of breakfast cereal were estimated to be $ 38.42 billion. A
company XYZ wants to launch its breakfast cereal product into Indian market. The company
hires you as marketing analyst. You have to make the marketing plan throughout the product
life cycle. How will you go about it?
At present company has the following data:
Total breakfast cereal industry for past 17 years.
Information about the 10 best selling cereals in year 2013.

Year Total Industry (in billion $)
1997 2
1998 3.5
1999 4.8
2000 1.2
2001 2.4
2002 3.9
2003 5.6
2004 12.5
2005 18.9
2006 19.9
2007 25.6
2008 20.8
2009 19.8
2010 29.9
2011 30.1
2012 35.2
2013 38.4

Table 1. Total Industry of Breakfast Cereal in India over the Years



Company Cereal
Market Share
(%)
Volume ($
millions)
Average Retail
Price ($)
Kellogg's Corn Flakes 4.58 175.96 2.18
Kellogg's Frosted Flakes 4.08 156.75 2.83
General
Mills
Cheerios 3.28 126.02 2.99
Kellogg's Rice Krispers 2.99 114.88 1.94
Kellogg's Raisin Bran 2.97 114.11 1.47
General
Mills
Honey Nut
Cheerios
2.77 106.42 2.74
Kellogg's
Frosted mini-
wheats
2.77 106.42 2.91
Kellogg's Froot Loops 2.33 89.52 2.64
General
Mills
Lucky Charms 1.85 71.08 3.15
General
Mills
Total 1.84 70.69 2.86

Table 2. Information about 10 best selling cereals

Based on the above data company wants from you:
Forecasting of total industry of breakfast cereal of next five years.
To find the least square equation that uses average retail price to predict market share.
Which of following three generalizations best describes the relationship between these
two variables:
o Lower price (independent) increases sales (dependent) with negative
relationship / coefficient.
o Bigger market share (independent) means a higher price (dependent) can be
charged.
o Market share (dependent) does not appear to depend on price (independent).