While forecasts are useful for developing internals, predictive forecasting also helps businesses generate unbiased, comprehensive, analytical insights to support improved decision making. Advanced predictive forecasting techniques use forms of artificial intelligence (AI) such as machine learning to predict more detailed, specific results, often with probability. This is usually done by viewing a large amount of historical and real-time data to identify patterns.
For example, predictive forecasting can help predict the company’s revenue for the coming year based on the forecasted development of specific variables such as search queries, competitor prices and extraordinary events. The impact of each driver can be analyzed individually, helping the company better understand market trends. Predictive forecasting is an automated forecasting technique that allows continuous adjustment of forecasts to help the company identify new opportunities and risks early and grow profitably.