A sophisticated market research technique called conjoint analysis helps organizations determine which product or service profile will be most profitable for them.
How was the conjoint analysis carried out?
Using the conjoint analysis technique, respondents are given a selection of product or service concepts for target market data and asked to select their top choice. Each description includes a number of qualities (attributes) of that product or service as well as comparison-able options.
For instance, if you were looking at toothpaste, you might offer any of the following 100-ml tube options, each with a range of pricing points, flavors, and benefit claims:
- Colgate, $3.70, removes plaque with spearmint.
- Crest whitening toothpaste, $3.25, fresh mint
- Sensodyne, $4.20, cold mint, good for your gums.
Utilizing Conjoint Analysis
Any study examining the influence of various product attributes on consumers’ purchase intentions must use conjoint analysis data. Consumers frequently claim that all characteristics are equally essential when questioned directly in quantitative or qualitative research, or they are unable to pinpoint precisely which characteristics are more motivating than others in their purchasing choice. Respondents are compelled to make trade-offs using a conjoint market simulation approach, much as they might in the real world. A conjoint analysis will identify these factors, even if consumers are not aware of them. Common business inquiries that Conjoint can resolve include the following:
- What combination of goods and services will generate the most potential sales and/or market share?
- Which price range(s) would be best for a particular configuration?
- Can we raise the price without hurting our share?
- What additional benefits can be provided to make up for a price increase?
- How is market share affected if competitors alter their value propositions or price strategies?
Any organization can use the consumer preferences gleaned by Conjoint to inform its sales, marketing, and advertising initiatives. Conjoint analysis is useful for a variety of projects, including product design, product development, product management, branding challenges, package design, pricing research, and market segmentation exercises.
Many Conjoint Analysis Types
All conjoint studies examine the overall “packages” of various goods and services (the particular set of features that each possesses), as well as the variations on those features.
There are various sorts of conjoint analyses and marketing research techniques included in this methodology; the following three examples are provided:
1. Conjoint analysis based on options
The most commonly utilized variation of the procedure is CBC, also referred to as discrete choice conjoint analysis. Instead of asking respondents directly about the significance of each quality, one of its key advantages is that it presents a realistic scenario of choosing between items.
2. Comparative analysis with adaptation
A flexible method of conducting CBC, adaptive conjoint analysis adjusts as a survey goes along so that the choice sets each respondent sees are based on the preferences they have already expressed. By personalizing the questions for each respondent, CBC becomes more efficient because less time is wasted on presenting product concepts that the respondent won’t find appealing.
3. Conjoint analysis that is self-explanatory
This type of conjoint analysis focuses on individual attributes and attribute levels rather than the set of attributes as a whole. Features that respondents would never consider could be eliminated, and they may also select their preferred and least preferred attribute levels.
Conclusion
This is how conjoint analysis is conducted in marketing. You can contact us for more information.
