Your company charged you with trying to decide what feature(s) to highlight in your upcoming campaign.
But with so many products in the market across every industry, consumers need to quickly understand your product's value, making your job as a marketer even harder.
You could create a survey and throw in a rank order question. But that often leaves you with more questions than answers. 🤔
So, how do you go about quickly quantifying your market's preferences?
💡 Give Choice-Based Conjoint a try.
What is Conjoint Analysis Used for?
Choice-Based Conjoint (CBC) can help marketers and insights teams get the data needed to identify how consumers value combinations of features when:
- Launching a new product
- Rebranding an existing product
- Designing an employee benefits package
- Testing advertising claims or packaging
- Exploring prices consumers are willing to pay for your product or service
- Tracking perceptions of competitive products
Choice-Based Conjoint is a great resource when trying to find that sweet spot between various combinations or alternatives when conducting product tests. It can help you identify which attributes respondents are more inclined to select over others in various combinations.
One of the benefits of using a CBC test over other methodologies is that it’s designed to mimic a normal shopping experience and calculates individual utility scores for each component. It’s pivotal in product research to see each attribute’s importance and the incremental value each option adds (or subtracts), allowing you to build and fine-tune your product before launching it.
3 Things to Consider Before Launching a Conjoint Study
Before diving into a Choice-Based Conjoint test, here are a few things to consider when testing a new or existing product:
- Going to market with a new product is hard enough; knowing what to price your product can be even more challenging. The ability to compare competitors’ offerings and pricing will help ensure you’re off to a good start.
- When analyzing your results, keep in mind which features respondents found most important and consider how to communicate them in your launch campaign.
- If you’re revamping an existing product, make sure you don't change the things your brand ambassadors already love about your product.
Use Cases for Conjoint Analysis
Conjoint analysis asks users to directly compare different features to determine how they value each one. Understanding which features consumers value over others empowers you to make data-backed decisions about pricing, marketing content, product development, and more.
Conjoint Analysis for Pricing Decisions
When your company understands how consumers value its products’ or services’ features, it can use the information to develop its pricing strategy, including understanding what features a customer is willing to pay for and whether they’d be willing to pay more.
Conjoint analysis can also help you explore the purchase intent for a competitor's product. If you’re priced too high or too low based on the results of your study, knowing before you launch will save you time and money in the long run. And lowering a price after a launch can change the perceived value of the product. If the results of your Conjoint test show that your product is underpriced, you can increase the price before you launch, ensuring that consumers never see two different prices.
Conjoint Analysis for Marketing Decisions
When a marketer knows which features customers value most, they can confidently use them in advertising, marketing copy, and promotions. These insights are tailored to help identify consumers’ brand perceptions, thoughts, and associations and can be used to fine-tune creative concepts, content, and imagery. The ability to deliver content that consumers find relevant, engaging, and inspiring in upcoming marketing campaigns can increase your SOM (share of market).
Conjoint Analysis for Research & Development Decisions
The insights gleaned from a conjoint study can help determine which new features should be added to your brand’s products or services, along with whether there’s enough market demand for an entirely new product. This technique will help you understand how far the brand could go to reinvent itself without alienating current consumers. Ensuring that your brand is relevant while making sure it evolves with the consumer and speaks to them in a way that makes them feel connected to the brand in a new format is key to a successful launch/re-invention.
Which Conjoint Should You Choose: Express or Segmentation?
Since we all have different needs, aytm has created two options to help you with your upcoming campaign, Conjoint Express, and Conjoint Segmentation.
Conjoint Express provides real-time analysis. It will learn about the preferences of your entire sample group (or a subset of it if you apply filters), but it won’t be able to tell you anything at the individual level of each respondent.
Below is an example of our simulator visualization that showcases the best/worst combination of considered options (you can toggle between the different options). In the example below, we see the probability of consumers selecting the Sydney 10 day vacation package, including a non-stop flight, unlimited food, tickets to all the local museums, and high-speed internet, is 86.9% ranked as the best vacation package.
Conjoint Segmentation will arrive at similar results as Conjoint Express, but with a much higher confidence. It will also look into clusters of respondents for you and automagically identify different personas if such personas emerge from the data.
Our live customer persona simulator will label personas with a hypothetical name and a photo to make it easier to distinguish and navigate among them. In the example below, Marissa is highlighted as one of the more prominent personas in the cluster who would be interested in a non-stop flight to Tokyo for one month that includes breakfast, high-speed internet, and spa packages. This information can be used to diversify your product line to attract different types of consumers.
Quantify Your Market’s Preferences with Conjoint
The brilliance of Conjoint analysis lies in its ability to determine the hidden rules consumers use to make trade-offs among different products and to quantify the values they place on different features or component parts of each product.
By understanding precisely how people make decisions and what they value in the product, you can identify the optimal combinations of features that balance value to the customer against cost to the company and forecast potential demand or market share in a competitive market situation.
Want to learn more about adding Conjoint experiments to your surveys?