'Long term sales forecasts will be the most important factor in our new marketing plan to break into the USA market.' (Lines 58–59). Do you agree with this statement? Justify your answer.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2017). The mark or mark type is shown in brackets.

1. Knowledge: Sales forecasts – predictions of future sales levels/revenue.
2. Knowledge: Marketing plan – detailed report on a business's marketing strategy – situational analysis, market research, objective, budget, mix.
3. Knowledge: Sales forecasts help to underpin and provide the framework for the market plan.
4. Application: ADP has no experience of USA market so cannot just assume the past will repeat itself.
5. Application: US market will need bigger washing machines etc.
6. Application: Product safety may need to be changed to meet safety regulations.
7. Analysis: Marketing plan will help ADP understand its current strengths, existing and potential competitors, consumer tastes and trends, the state of the market that is being entered. This will then inform decisions about the marketing mix that need to be taken in order to achieve the marketing objectives.
8. Analysis: Sales forecasts will inform decisions about appropriate objectives and thus determine budget required to achieve.
9. Analysis: Situational analysis will be important starting point for the business that will then enable sales forecasts to be made.
10. Analysis: Other elements of marketing plan are important e.g. integrated marketing mix to ensure consistency in message communicated to potential customers and therefore attract sales.
11. Evaluation: Market plan must be based on sales forecasts – how else can realistic objective be set? How else could appropriate budget be determined? How could mix decisions be made unless some idea of likely effective demand is established?
12. Evaluation: Sales forecasts can be very inaccurate – especially long term forecasts and especially for new markets and for fast changing markets or those with unusual customer demands e.g. larger appliances in the USA!
13. Evaluation: Other components of the plan also very important: SMART objective; realistic budget (how determined?) and a fully integrated marketing mix.
14. Evaluation: Especially important in this case as in this case, the forecasts will have to be based on market research and/or qualitative methods – moving average not appropriate.