C onjoint Analysis offers the only viable vehicle for getting inside the decision-making processes of consumers by forcing them to make trade-offs as we all do every day when buying products and services. Consider your own decision-making process for a smartphone or a big screen TV – what role does price play, brand, features, warranty, other factors? Conjoint Analysis enables you to address the importance of those features at the individual respondent level.
Analyzing Trade-Offs is the Key
Conjoint analysis is one of the most effective approaches for extracting consumer preferences regarding the purchasing process and generating quantitative estimates of the value or weight they associate with different product features, including price and brand. It evaluates products or services in a way no other method can. Forcing people to make trade-offs is the key and by analyzing the trade-offs they make between product features, we can estimate the value they associate with each.
Here is a sample choice table from a discrete choice exercise. A typical respondent would need to do 8 to 10 of these depending on the number of attributes and their associated levels.
Conjoint Analysis for Better Decision Making
Both art and science are required for this analytical process. The art comes from experience: SPH has been applying conjoint analysis in healthcare for over 35 years. The science comes from both experience and the knowledge base covering the growing body of knowledge around techniques used for conjoint analysis.
Results from the SPH Conjoint Analysis process enable clients to:
- Make better decisions about product design, such as which feature combinations are most attractive to consumers by market segment.
- Understand what pricing approach works best.
- Determine how different configurations of your product fare against specific competitive products.
- Estimate how will various versions of products you are evaluating fare against the current products of target competitors or against products they know those competitors are considering.
The Process for Your Conjoint Analysis Application
STEP 1
The SPH team will develop an appropriate list of attributes and levels and select the appropriate conjoint technique for your particular issue.
STEP 2
These attributes and levels are turned into exercises prompting people to make enough trade-offs, enabling SPH to do the necessary estimation and collect the data from the appropriate respondents.
STEP 3
The experts at SPH use the estimates to simulate how people will respond to different products that are being considered, and then use those results as a set of variables in a market segmentation analysis.
Partner with a Trusted Leader
For more than three decades, SPH Analytics has helped healthcare organizations improve the experience and engagement of their patients and members. Let us bring our unique expertise and analytical and predictive approach to your organization’s challenges.