https://communities.sas.com/t5/SAS-Forecasting-and-Econometrics/General-question-types-of-explanatory-variables-one-can-use-in/m-p/45631#M208 Hello -<BR /> I'm not completely sure I'm getting your point, but here are some thoughts anyway:<BR /> when using explanatory variables in your models it will be crucial to have future values of these variables in order to calculate the forecast for the dependent variable. <BR /> As such I think I would go with actual numbers, as they reflect what was happening in fact - not the "wishful thinking" of ours. <BR /> What you will need to do is to create forecasts for your independent variable first (if you don't have future estimates - or use the forecasts of your marketing folks as future values) and then create the prediction of the dependent variable.<BR /> In fact, you might consider doing a what-if analysis, i.e. testing what happens if you change the future values of your dependent variables. <BR /> Note that this is an out-of-the-box feature of SAS Forecast Studio - which is part of SAS Forecast Server.<BR /> Thanks!<BR /> Udo Fri, 09 Jul 2010 11:29:32 GMT udo_sas 2010-07-09T11:29:32Z https://communities.sas.com/t5/SAS-Forecasting-and-Econometrics/General-question-types-of-explanatory-variables-one-can-use-in/m-p/45630#M207 Hello,<BR /> <BR /> I am trying to forecast future web sales for my company. A subset of that is "keycoded" revenue that can be traced back to particular advertising campaigns. The marketing dept. produces forecasts for keycoded revenue, and I would like to use those as an explanatory variable to predict overall web sales. <BR /> <BR /> My concern is this: there is almost a perfect relationship between *actual* keycoded revenue and *actual* overall web sales. Obviously, I won't have the benefit of knowing future actuals when making forecasts; I will have *forecasted* keycoded revenue instead. <BR /> <BR /> So my question is, would you prefer to use historical actuals or historical forecasts of keycoded revenue when developing the forecasting model?<BR /> <BR /> I hope this wasn't too confusing. Thank you! Thu, 08 Jul 2010 15:51:51 GMT https://communities.sas.com/t5/SAS-Forecasting-and-Econometrics/General-question-types-of-explanatory-variables-one-can-use-in/m-p/45630#M207 sassygrl 2010-07-08T15:51:51Z https://communities.sas.com/t5/SAS-Forecasting-and-Econometrics/General-question-types-of-explanatory-variables-one-can-use-in/m-p/45631#M208 Hello -<BR /> I'm not completely sure I'm getting your point, but here are some thoughts anyway:<BR /> when using explanatory variables in your models it will be crucial to have future values of these variables in order to calculate the forecast for the dependent variable. <BR /> As such I think I would go with actual numbers, as they reflect what was happening in fact - not the "wishful thinking" of ours. <BR /> What you will need to do is to create forecasts for your independent variable first (if you don't have future estimates - or use the forecasts of your marketing folks as future values) and then create the prediction of the dependent variable.<BR /> In fact, you might consider doing a what-if analysis, i.e. testing what happens if you change the future values of your dependent variables. <BR /> Note that this is an out-of-the-box feature of SAS Forecast Studio - which is part of SAS Forecast Server.<BR /> Thanks!<BR /> Udo Fri, 09 Jul 2010 11:29:32 GMT https://communities.sas.com/t5/SAS-Forecasting-and-Econometrics/General-question-types-of-explanatory-variables-one-can-use-in/m-p/45631#M208 udo_sas 2010-07-09T11:29:32Z