Volkswagen Executive Summary

 The VW group is one of the leading automotive OEMs in the world and Volkswagen
Group sells its vehicles in 153 countries.

 In 2016, the group replaced Toyota as the largest OEM in the world in terms of number of
units sold. The group sold a total of 10.4 million units globally in 2016

 The group aims to consolidate its position as the apex automaker in the future as well
through its Strategy 2025 vision
Problem Definition

 Volkswagen AG automobile manufacturer and a carmaker in

Europe wants to decide on the marketing budget for next 3 years
 Based on the sales trend and marketing investment for the last 10
years we need to predict the required marketing cost for future
Financial Years
 Using the Statistical Methods(Forecasting and Regression)
Prediction of sales and marketing budget needs to be derived
 Sales Trend

 In the Last 10 years Volkswagen has been dip in sales for the 2009 and 2013 .

 There has been a steady increase in the sales from 2014 when company has launched new variants
 Marketing Budget Allocation Trend

 From the Last 10 years Data Volkswagen has steadily increased marketing budget

 The highest marketing budget has been allocated in the year 2017 for digital and commercials
 Forecast (Using “FORECAST.ETS”)

Forecast Sales Sales Forecast(Sales) Lower Confidence Bound(Sales) Upper Confidence Bound(Sales)

45000
Lower Confidence Upper Confidence
Year Sales Forecast(Sales) Bound(Sales) Bound(Sales) 40000 39955.44
2007 18162 37785.71
2008 12216 35448.20
35000
2009 11051
32855.59
2010 16118
2011 18223 30000 29801.30
2012 16560 26678.10802
25850.31181
2013 14210 25000 25022.5156
24194.71939
2014 18285 23366.92318
22074 22535.00
22535
2015 22074 20000
2016 22535 22535 22535.00 22535.00 18162 18223 18285
2017 23366.92318 16932.55 29801.30 16560 16932.55
16118 15533.85
15000 14596.8313914.91
2018 24194.71939 15533.85 32855.59 14210
13400.78
2019 25022.5156 14596.83 35448.20 12216
11051
2020 25850.31181 13914.91 37785.71 10000
2021 26678.10802 13400.78 39955.44
5000

0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
 Forecast (Using “FORECAST.ETS”)

Forecast Market Share VW Share Forecast(VW Share)

Lower Confidence Bound(VW Share) Upper Confidence Bound(VW Share)
Lower Confidence Upper Confidence
VW Share Forecast(VW Share) Bound(VW Share) Bound(VW Share) 25%
14%
11% 22%
21%
11% 20%
20%
13% 19%
13% 18%
12%
10% 15% 15% 15% 15%
15% 15% 15% 15%
13% 14%
13%
13% 13%
15% 12%
11% 11% 11%
15% 15% 15% 15% 10%
10% 10% 10%
15% 11% 18% 9%
9%
15% 10% 19%
15% 10% 20%
15% 9% 21% 5%
15% 9% 22%

0%
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
 Forecast (Using “FORECAST.ETS”)

Forecast Market Share

Marketing Cost Forecast(Marketing Cost)

Forecast(Marketi Lower Confidence Upper Confidence Lower Confidence Bound(Marketing Cost) Upper Confidence Bound(Marketing Cost)
Year Marketing Cost ng Cost) Bound(Marketing Cost) Bound(Marketing Cost) 800000
2007 345078 759153.35
2008 232104 717928.55
700000
673515.81
2009 209969
624256.26
2010 306242 600000
2011 346237 566224.68
2012 314640 500000 506884.05
491155.92
475427.80
2013 269990 459699.67
443971.54
2014 347415 419406428165.00
428165
400000
2015 419406 345078 346237 347415
2016 428165 428165.00 428165.00 428165.00 314640 321718.40
300000 306242 295143.08
269990 277339.79
264383.30
2017 443971.54 321718.40 566224.68 254614.76
232104
2018 459699.67 295143.08 624256.26 200000 209969
2019 475427.80 277339.79 673515.81
2020 491155.92 264383.30 717928.55 100000
2021 506884.05 254614.76 759153.35
0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
 Regression Report
RESIDUAL OUTPUT PROBABILITY
Year Sales VW Share Marketing Cost
OUTPUT
2007 18162 14.06% 345078
Observation Predicted Marketing Cost Residuals Standard Residuals
2008 12216 11.04% 232104 (2007) 1 342417.3229 2660.677135 0.753348106 Percentile Marketing Cost
2009 11051 11.20% 209969 (2008) 2 231086.4322 1017.5678 0.28811567 3.3333 209969
2010 16118 12.62% 306242 (2009) 3 211798.6869 -1829.686855 -0.518060274 10.0000 232104
2011 18223 13.17% 346237 (2010) 4 305857.3167 384.6832531 0.108919792 16.6667 269990
2012 16560 12.00% 314640 (2011) 5 345438.7521 798.2478696 0.226017096 23.3333 306242
(2012) 6 314265.6731 374.3269392 0.10598749 30.0000 314640
2013 14210 10.00% 269990 36.6667 345078
(2013) 7 268985.1097 1004.8903 0.284526143
2014 18285 12.68% 347415 43.3333 346237
(2014) 8 348390.5977 -975.5977389 -0.276232204
2015 22074 14.65% 419406 50.0000 347415
(2015) 9 421077.0541 -1671.054071 -0.47314475
2016 22535 14.58% 428165 56.6667 419406
(2016) 10 430074.1611 -1909.161055 -0.540562718
2017 23367 14.75% 443972 63.3333 428165
(2017) 11 446215.2568 -2243.716352 -0.635289206
70.0000 443971.5404
2018 24195 14.92% 459700 (2018) 12 462273.9049 -2574.236448 -0.72887316 76.6667 459699.6684
2019 25023 15.09% 475428 (2019) 13 478332.553 -2904.756544 -0.822457115 83.3333 475427.7964
2020 25850 15.26% 491156 (2020) 14 494391.2011 -3235.276641 -0.91604107 90.0000 491155.9244
2021 25850 15.43% 506884 (2021) 15 495780.96 11103.09241 3.143746201 96.6667 506884.0524
ANOVA
Regression Statistics df SS MS F Significance F
Regression 3 1.27008E+11 42335933781 2666.741007 5.10073E-16
Multiple R 0.999313227
Residual 11 174630858.6 15875532.6
R Square 0.998626926
Total 14 1.27182E+11
Adjusted R Square 0.998252452
Standard Error 3984.411198 Coefficients Standard Error t Stat P-value Lower 95% Upper 95% Lower 95.0% Upper 95.0%
Intercept -2011884.977 1530960.879 -1.314132193 0.215545703 -5381507.153 1357737.199 -5381507.153 1357737.199
Observations 15
Year 996.5103674 759.2630104 1.312470585 0.216086545 -674.616251 2667.636986 -674.616251 2667.636986
Sales 17.72041109 1.417650762 12.49984239 7.63901E-08 14.6001828 20.84063938 14.6001828 20.84063938
VW Share 230959.6166 266325.8099 0.867207038 0.404349416 -355219.5386 817138.7718 -355219.5386 817138.7718
 Regression Outcome

Year Line Fit Plot Sales Line Fit Plot VW Share Line Fit Plot
600000 600000 600000

Marketing Cost

Marketing Cost
Marketing Cost

400000 400000 400000

Marketing Cost Marketing Cost Marketing Cost
200000 200000 200000
Predicted Marketing Predicted Marketing Predicted Marketing
0 0 0
Cost Cost Cost
2000 2010 2020 2030 0 10000 20000 30000 0.00% 10.00% 20.00%
Year Sales VW Share

Conclusion:
After comparing the p-value with significance(F)
Accepting the null hypothesis since p-value (0.215) is greater
than the significance (F – 0.00000000000005100)
 Recommendation

 Sales would be gradually increased if the marketing budget is increased

 To Achieve better sales Volkswagen needs to increase the marketing budget

 Based on the Predicted sales for the year 2019 Volkswagen need to allocate $475427 for marketing
through different channels.
Thank You