Market Research Toolbox: New or Existing Products: Maximize sales with Best Combination of Features
Is Quality, Price, Size, or Brand Most Important?
When a scientist compares products to decide which to purchase, they most often make tradeoffs on performance, quality and price. It is by considering features and price together that scientists determine which product format will provide the key value to meet their needs. If your product package fails to meet a customer’s value requirement, it will likely not be selected among other products. To analyze Product Feature / Price Tradeoffs, Conjoint Analysis is a powerful, statistical technique for incorporating structured customer preferences into the design of new products.
Conjoint Analysis
- Ranks importance of each product feature
- Compares product feature configurations against one another
- Identifies trade-offs that scientists are willing to make based on price
- Pinpoints best overall product configuration
Case Study: Specifications for a New Instrument
A client with a new instrument in the final stages of production came to BioInformatics to determine the most preferred specifications desired by end-users. The client was concerned about which bundle of features would be considered most valuable and what price customers would be willing to pay for enhanced technologies. We proposed a conjoint analysis featuring 16 possible product configurations, based on the number of product features the client wanted to include. Each was evaluated by potential end-users of the new instrument to find the most attractive product configuration. Based on the study, the client’s marketing and R&D team discovered the optimal product feature package that would maximize sales based on end-user preferences.
Uncovering Feature Importance and Best Overall Instrument Design
Conjoint analysis asks the respondent to make choices in the same fashion as the consumer presumably does—by trading off features, one against another. Researchers indicate their purchase likelihood of several product configurations as designed by the Conjoint Analysis software. Respondents provide their likelihood to purchase on each configuration via an online evaluation, by viewing one product configuration at a time.
Delivering Results
The results of this analysis quickly highlight which features are considered to be most important when making a purchase decision. It also identifies if researchers regarded any of the product configurations positively. Conjoint analysis also allows us to predict product feature configuration outcomes that were not presented in the original experiment. This technique can also calculate results based on feature levels that were not tested, such as a price point between two presented in the online evaluation.
BioInformatics’ approach using Conjoint Analysis provided key decision making information to the client, who was able to build an instrument system that would yield the greatest interest in purchasing. Our results revealed the features and additional functionality for which researchers were most willing to spend extra.
To get more information on BioInformatics’ Product Feature / Price Tradeoffs analysis or to discuss further details of your potential market study, please email [email protected].
