Conjoint Analysis &Multidimensional Scaling

Conjoint Analysis

About Conjoint AnalysisConsumer preferences for alternative product concepts can be measured through conjoint analysisIt is a method for deriving the utility values that consumers attach to varying levels of a products attributes. Respondents are shown different hypothetical offersformed by combining varying levels of the attributes, then asked to rank the various offers. Management can identify the most appealing offer and the estimated market share and profit the company might realize.

Example for Conjoint AnalysisSuppose the new-product marketer is considering five design elements:Three package designs (A, B, C Three brand namesThree pricesA possible Good Housekeeping seal (yes, no)A possible money-back guarantee (yes, no)

Example for Conjoint AnalysisPossible Product Concepts ?3 X 3 X 3 X 2 X 2= 108

Example for Conjoint AnalysisA sample of, say, 18 contrasting product concepts can be chosen, and consumers would rank them from the most preferred to the least preferred.

Multidimensional Scaling

Definition

If you are interested in how certain objects relate to each other and if you would like to present these relationships in the form of a map then MDS is the technique for you

MDS Provides A picture is worth a thousand wordsa useful and easily-assimilable graphic visualisation of all sorts of data In a user-chosen (small) # of dimensions providing a graphical representation of the structure underlying a complex data setAnd measure how well / badly the solution distances match the data dissimilarities (Stress)

Multidimensional ScalingA variety of techniques for producing perceptual maps of competitive brandsHere objects are represented as points in a multidimensional space of attributes where their distance from one another is a measure of dissimilarity

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