Editor’s note: Stephan Basson is content marketing manager at market research firm Factworks, Berlin.
You’ve done it. You’ve just thought of the next big thing. Now you need to ask yourself, how can I position this product so its particular novelty is noticed and secures its place in the market? What features or attributes should it have to attract the most customers and, most importantly, what should the price of the product be? In this article I will cover how to answer these critical business questions through advanced conjoint analysis.
Conjoint analysis is generally considered the gold standard for product and pricing decisions. Conjoint experiments simulate the buyer experience whereby consumers consider all the features of a product and compare them to those of other products before making a purchasing decision.
By contrast, if you ask respondents to rate which features of a product they see as important, it’s likely that you may not get very discriminating results. Respondents might even rate all the features as important, resulting in very few realistic implications.
Conjoint surveys instead ask respondents to choose between product alternatives with different features and prices. Just like in real life, respondents need to make trade-offs to decide which product is best and if they would even buy any of them, allowing researchers to determine which features respondents truly value.
However, predictions about consumer behavior become difficult when the product landscape or category is highly complex. In these instances, creating realistic choice scenarios help respondents make realistic trade-offs. The challenge is, how do you mimic these choice scenarios in survey design with all the complexities that make up the modern, user-friendly online shopping experience?
E-commerce sites offer shoppers a plethora of products at the touch of a button, all in a single view...