Answer :
When forecasting demand for new products, sometimes firms will use demand data from similar existing products to help forecast demand for the new product. This is an example of Historical Analogy.
An historical analogy describes the processes used to steer a judgmental forecast and is helpful in building an understanding of history. When constructing scenarios to forecast the future, analogous elements are useful. A pattern to predict the future sales of a certain product can be developed by comparing a product with its alternatives.
It involves comparing a product's past success to its current performance and utilizing that data to predict how well a similar product will perform in the future. It refers to situations and events in addition to comparing various products.
An illustration of a historical similarity is the evaluation of a huge number of immigrants who arrived in the Levant and eventually came to control the local administrations, paving the path for the marginalization of the native populations. The end result was that the people suffered and were forced to relocate to less prosperous locations. Similar events occurred simultaneously in South Africa and the northern United States.
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