Conjoint Analysis
What is conjoint analysis?
The objective of conjoint analysis is to determine what combination of attributes is most influential on respondent choice or decision making.
A controlled set of potential products or services is shown to respondents and by analyzing how they make preferences between these products, the implicit valuation of the individual elements making up the product or service can be determined.
These implicit valuations (utilities or part-worths) can be used to create market models that estimate market share, revenue and even profitability of new designs.
this technique can be used to answer a wide number of questions including:
- Which new products will be successful?
- Which features or attributes of a product or service drive the purchase decision?
- Do specific market segments exist for a product?
- What advertising appeals will be most successful with these segments?
- Will changes in product design increase consumer preference and sales?
- What is the optimal price to charge consumers for a product or service?
- Can price be increased without a significant loss in sales?
Conjoint analysis techniques may also be referred to as multi-attribute compositional modeling, discrete choice modeling, or stated preference research, and is part of a broader set of trade-off analysis tools used for systematic analysis of decisions.
