The Importance of Forecasting in the Process of Developing a New Postal Service

Abstract

This paper presents a modification to the standard Bass Diffusion Model applied to new services along with an analysis of different aspects which influence the parameters essential for defining a product's life cycle. An analysis of the potential application of the modified model -a model with gradual market potential growth in which the successive introduction of service alters both territorial coverage and new service availability -has been conducted on a sample of two financial services offered by the PE Post of Serbia (a new service -international postal money order, and an existing service -Western Union money order). Due to confidentiality of the data owned by the operator, a quantitative parameter which estimates market potential for the new service is not available. However, a detailed analysis of various influential factors (infrastructure, social environment, migrations, and demographical and psychographic population characteristics) is provided, while the parameters which define the rapidity of the acceptance of the new service and its later growth have been calculated using comparison with the existing service. Various forecast models have been gaining significance concerning business decision making and gaining competitive advantage. For this reason, the authors tried to provide directions for diffusion model implementation in postal traffic and to emphasize its applicability and significance, for both the abovementioned financial services and other types of services offered by postal operators.