oa Business Management Review - A critique of Markov analysis in forecasting market shares

Volume 4, Issue 2
  • ISSN : 0856-2253



Market share forecasting has become very important due to intense competition among firms. Whereas this is so, market share forecasting in many instances is not easy. There are several ways of forecasting market shares, one of which is Markov analysis. However, though the Markov analysis is useful in probabilitistic problems with a dynamic nature, like many other techniques, models, and theories, rely on certain assumptions which reduce its value in forecasting. This paper critically analyses Markov analysis mainly in view of its assumptions in forecasting market shares of brands. It also highlights some of the problems which are not necessarily related to the assumptions directly, and those problems that arise as one tries to get round the problems themselves. In the end, the paper still considers Markov analysis as useful and makes recommendations regarding its applications in market share forecasting.

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