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Forecast

Demand on Automobiles to
increase sales for automo9ve company
Anita, Louie Group
5 Fanny, Paul

B A F T

I. Business Problem
Client: an automo3ve company like Suzuki
Business benet:
Increase automobile sales
Improve marke3ng eciency
Set up suitable marke3ng strategy among regions and
seasons
Challenges:
Consumer preference for brands is not considered (hard to
predict)
Opportunity:
Design a beDer marke3ng strategy to decrease cost and
increase sales
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II. Forecas3ng Goal

Goal: Forecast the demand on automobile in 2015.


Analysis:
Prospec3ve:
predict future trend and analyze seasonal paDerns
The forecasts will be used to set marke3ng strategies and
promo3onal plans in 2015
Forecast horizon: 1 year (12 months)

III. Data Descrip3on (1/2)


1. Number of automobile
Forecast trend for long-term strategy
Source: Ministry of Transporta3on and Communica3ons R.O.C
2000:12- 2014:08 (165 obs.)
Four largest ci3es: New Taipei, Taipei, Taichung, Kaohsiung
Upward trend

III. Data Descrip3on (2/2)


2. Number of new automobile registra3on

Analyze seasonality for short-term strategy


2012:01~2014:11 (35 obs.)
Four largest ci3es: New Taipei, Taipei, Taichung, Kaohsiung
Seasonality: 6 months

Peak in January
and July!
Low in February
and August

IV. Methods
1. Number of automobile
1) Double Exponen3al
2) Linear regression
3) Nave

2. Number of new automobile registra3on


1) Linear regression
2) Holt-Winter
3) Seasonal Nave

6 seasons

V. Forecasts and Evalua3on (1/2)


- Number of automobile

Method: Double Exponen3al


Forecast

The number of automobile


is predicted to increase!

V. Forecasts and Evalua3on (2/2)

- Number of new automobile registra3on


Forecast
Holt-Winter does not capture
highs and lows well!
Regression has the 2nd lowest
RMSE and captures the
seasonality well!
Highest in January & July!

VI. Others: Opportunity for motorcycle sales


Data: number of motorcycle (2000:12- 2014:08)
The amount of motorcycle dropped sharply in July 2013
The reduc3on is one-3me event due to a policy that
encourage old motorcycle to re3re before October 2013 to
waive taxes

Opportunity for
motorcycle sales!

VII. Recommenda3ons
1. Increase automobile produc3on
2. Marke3ng strategies for automobile:
Same marke3ng strategies on all regions
Heavy promo3on and adver3sement on January
(near Chinese New Year) and July (students
graduate)
3. Opportunity for motorcycle sales to increase
Promo3on on motorcycles
(e.g. discount on purchasing automobile with
motorcycle)
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