This paper outlines some current research being conducted at the London Business School, sponsored by the Leverhulme Trust in conjunction with the Gallup Poll, into how market survey data can be used to measure the state of consumer expectations and to examine the way in which it influences expenditure. There are two types of survey (generally referred to as anticipation surveys) which attempt to measure the strength of consumer expectations. The first, known as an Attitude Survey, is a more general measure of the state of consumer optimism and pessimism and is derived from a number of attitude questions relating to how a consumer views the likely outcome of economic conditions in the near future. The replies are summarised into a single index called the 'Index of Consumer Confidence' . The second type of survey, known as Buying-Intentions Survey, is concerned with measuring directly the expressed buying intentions for specific consumer durables, such as automobiles and major household goods
In this paper some methods will be described which are being used for forecasting markets of consumer durable goods. The models will be explained for both initial and replacement demand separately. As market forecasts are being used together with forecasts of consumer expenditures on categories of products, the paper starts with a description of the link between the macro and micro approach of consumer demand.
In the present state of the art of econometrics, it is not possible to quantify or validate the relationships sketched at the macro level. Data on certain of the other relationships point in certain directions and so we have some knowledge of how one variable affects another if at times we cannot be very precise about the strength of the effect. In other cases where we have little or no data, we have subjective ideas: if the model reacts particularly sensitively to a hypothesised relationship, we have to feed in different values for the variable in question and take a view about which is most likely. Our present forecasting method is based on the past relationships between rises in consumer expenditure, expenditure on foreign travel and number of inclusive tours. Naturally we monitor continually to refine and if necessary adjust this technique.
We do not envisage the use of linear programming as the speaker himself says that the model is not made to find an optimum solution, but rather the exploration of the consequences of different decisions, assumptions or events. Linear programming looks to us a heavy technique which needs some risky assumptions of linearity.
The following report deals only with survey on French tourists who spend their holidays in France. The I.N.S.E.E. had already included questions on holiday spending in the survey mentioned above, which was effected a posteriori. It aimed to determine the range of total expenditure but was, however, divided into 3 major sections: transport, lodging, other expenses (especially food). In August 1967 , SOFRES conducted a first trial survey, using the method of a diary of the expenses which was handed out by an interviewer in the holiday resorts themselves. At the time of writing, the fieldwork has not been completed, so for the moment the final conclusions of the experiment are not available. Several comments may, however, already be made.
There are many difficulties to be overcome when the attempt is made to introduce market research techniques into R&D. It is not only the resistance of technically minded scientists and managements, but the subject matter itself is full of pitfalls. Since it would be most unwise to consider every step in an R&D programme from the point of view of the market it is necessary to divide R&D into several steps in order to decide at which point marketing should exert its influence. This is largely a matter of semantics and solutions are not easy. Nor is it simple to design market research techniques which, when used, will assist managements in deciding which R&D projects to pursue and which not. The material, on which this paper is based, comes largely from the United Kingdom. But the principles involved are world-wide because every industrialised country is faced with the facts of: 1. increasing expenditure on R&D and; 2. the waste of scarce manpower and resources connected with this development.
The survey which the weekly Paris-Match and the monthly Marie-Claire placed with Dorset&Co in 1957 had as its object to measure the household expenses of their readers and to compare them with the average expenses of French households. Seen from that angle, the proposed survey implied an absolutely representative selection of interviewees and a link with an organisation having already effected a survey on household expenses of French families. Here is how these two points were solved.