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Conjoint Preference Share Simulator


Conjoint.ly allows you to simulate shares of preference for different market offerings. Specifically, you need to describe offerings that are available on the market in the language of the attributes and levels that you chose to include in the study, and the system will estimate the percentages of preferences for these offerings. Please keep in mind that:

  • If you would like to test out a new product, add it to the list of existing concepts.

  • If two or more offerings share exactly the same levels, input each offering separately. For example, if there are two brands each offering identical products, put in both brands in two separate lines.

  • The market shares are only approximate and may be affected by constrained availability of some products (e.g., not available in all geographies), shelf space (in case of FMCG).


Automated preference share simulations for what-if scenarios

Brand Specific Conjoint and other types of experiments provide outputs allowing estimation of preference shares, revenue projections and price elasticity for specific market scenarios.

Below are the predictions for a baseline scenario of four car brands:

Simulation of price elasticity preference shares for Ladina Klubnia

Simulation of price elasticity revenue projections for Ladina Klubnia

This baseline assumes the following features of the four car models:

Baseline
 
Make and model Drive-away price Transmission Engine type
     

Feature selection

Now that we have established a baseline, we can check what happens if we change the attribute of Transmission from Automatic to Manual for the Ladina Klubnika model:

Ladina Klubnia: Automatic vs. Manual
Ladina Klubnia preference shares simulation of Automatic versus Manual

Ladina Klubnia revenue projections simulation of Automatic versus Manual

Price elasticity of demand in two clicks

Price elasticity of demand can be calculated for multiple scenarios by clicking on two points of a preference share simulation.

Price elasticity of Ladina Klubnia
Simulation of price elasticity preference shares for Ladina Klubnia

Simulation of price elasticity revenue projections for Ladina Klubnia

In this scenario, when clicking on both the $23,000 and $25,000 price points for Ladina Klubnika a message will be displayed stating that the price elasticity of demand is elastic.

Price elasticity of Ladina Klubnia
Simulation of elastic demand preference shares for Ladina Klubnia


Ladina Klubnika

Price elasticity of demand between $23,000 and $25,000 is -4.6.

Demand is elastic (i.e., an increase in price by 1% leads to more than 1% drop in volume).

New product launch simulations

New product launches (NPDs) can be simulated to see redistribution of preference and revenue shares.

New Product Launch of Ladina Klubnika [ Petrol ]
New Product Launch redistribution of preference shares for Ladina Klubnika

New Product Launch redistribution of revenue projections for Ladina Klubnika

Advanced settings in the simulator

The Conjoint.ly simulator comes with several advanced features, including:

  • Applying adjustments to bring preference shares closer to observed volume shares,
  • Running simulations for specific segments rather than the whole market,
  • And more.

Models for calculating market shares

There are two models for calculating market shares:

  • Share of preference model, which is appropriate for low-risk or frequently purchased products: FMCG, software, etc. This model is applicable in the vast majority of applications.

  • First choice model, which is suitable for high-risk or seldom purchased products: education, life insurance, pension plans, etc.

In most cases, both simulation models produce substantially the same results. However, at times, simulations results will differ greatly from actual market shares, hence adjustments may be needed.

The “Segregate” function

The “segregate” function creates a variable based on people who would buy certain concepts within each scenario. It allows you to then segment your report to view the preferences of respondents who are willing to buy certain products. To use the “Segregate” function:

  • Open the “Simulations” tab in your survey report.

  • Click the “Show advanced settings” button at the bottom of your screen then click the “Segregate” button next to the “Enable segmentation based on preferences for concepts in this scenario” heading. A message will appear in the left panel once segmentation is complete.

  • Open the “Segmentation” tab and click the “Add a new condition” button.

  • Click the “Segregation based on simulation” option.

  • Select your desired Variable, Type of match, and Value from the respective drop-down menus before clicking the “Save and apply these segments” button in the bottom right corner. A message will appear in the left panel once segregation is complete.

  • Open the “Compare segments” tab to view respondents' profile and preferences from your new segment.

Creating a segment to view preferenes of respondents who are willing to buy certain products

The “Source of Business” Function

The “Source of Business” function allows you to see the change in preference share between scenarios, for all products within a simulation. When including a new product in the simulations, this allows you to see which products had their preference share reduced, to make up for the preference share gained by the NPD.

To use the “Source of Business Function”:

  • Open the “Simulations tab” in your survey report

  • Click on the “Show advanced settings” button at the bottom of your screen, then select “Investigate source of business”.

  • Follow the prompts to select your baseline scenario, as well as the new scenario. This will generate a source of business chart which shows the change in preference share for each product.

The source of business function

The source of business function is useful to investigate how launching an NPD will affect a firm’s overall preference share, due to cannibalisation of existing share.

FAQs

How do I use the set-up wizard for the online simulator?

When creating a simulation for your experiment, you will first be prompted with a wizard that will help you to set up the baseline worksheet for your simulation through the following steps:

Step 1: Indicate which brands / SKUs / pricing tiers belong to your company and which ones to your competitors.
Step 1 of the wizard step up
Step 2: Configure current brands / SKUs / pricing tiers (including both your company’s and competitor products).
Step 2 of the wizard step up
Step 3: Configure defaults for your new product (Only applicable if there is at least one Unlaunched NPD indicated in Step 1).
Step 3 of the wizard step up
Step 4: Select Create Worksheets in the bottom right hand corner. Your simulator will now be ready to use, initialised with relevant simulations for your SKUs.
Step 4 of the wizard step up

How do I perform segmentation in the Excel simulator?

You can create segments in the Excel simulator by adjusting the Weight of each respondent within the Individual Preferences tab.

By default, the weight for each respondent is 1, meaning that all respondents are included in all simulations. To create a new segment, the weight for each respondent will need to be set to 1 to include them within the segment, or 0 to exclude them.

Preference share simulator: segmentation by weight

What are the default formulas and revenue based on preference shares?

Preference shares and revenue projections (assuming 1000 units offered) can be simulated to assist in adding or modifying product features.

By default, we estimate Volume = 1000 × (Preference share). We use the factor of 1000 for convenient scaling. However, if you know the actual volume of units sold in the market, you should use that instead of 1000.

Then Revenue = Price × Volume.

Can you simulate preference shares based on MaxDiff studies?

Using the simulator for MaxDiff should be done with caution because the simulator answers the question “What % of time would a particular option be chosen?”. Choice-based questions (i.e. Conjoint or Claims Test) can accurately answer the simulator’s question because they are about choice among several options, whereas MaxDiff asks both “best” and “worst” choices and uses the “worst” choice in calculating utilities as well.

This means that an option that is occasionally named “worst” in a choice set will have a lower predicted preference share in MaxDiff than it would in conjoint (where we do not consider “worst” options), which can cause overestimation of preference shares for the topmost preferred options.

For this reason, we suggest using simulations for choice-based exercises only as these are robust whereas MaxDiff simulations are only indicative.

Can you build a custom Excel simulator?

Yes, preference share simulators are commonly customised for specific conjoint studies. It is particularly useful for more complicated types of conjoint analysis.

These files are often created and used in Microsoft Excel or as online dashboards. We provide an example conjoint simulator file on Google Sheets (which you can copy to edit).

Is an interactive Excel simulator included in Conjoint.ly outputs?

Yes, as well as the user-friendly online simulator, Conjoint.ly also allows you to export an interactive Excel simulator. To use it, please refer to the Simulator tab.

Additionally, you can explore its inner workings by looking at the hidden sheets labelled SimXXX. For example:

  • Sim1 contains individual preferences.
  • Sim2 translates the simulator parameters into 0s and 1s.
  • Sim3 is a matrix obtained by MMULT of Sim1 and Sim2.
  • Sim4 to Sim6 calculates the individual share of preference through the multinomial logit formula: EXP(A1)/(EXP(A1)+EXP(A2)+…+EXP(An)).
The Conjoint.ly Excel Plugin helps with charting Conjoint.ly outputs, including simulations charts from the Conjoint.ly online simulator (scenario modelling and price elasticity charts), colouring for TURF analysis, and other useful utility functions.

How do I use the simulator to calculate volume, revenue, and profit?

The Conjoint.ly online simulator can be used to calculate volume, revenue, and profit using both default or custom formulas. You are also able to set the value revenue/profit for different SKUs to zero, which is useful for competitor products.

Using the simulator to calculate volume, revenue and profit

Preference shares and revenue projections (assuming 1000 units offered) can be simulated to assist in adding or modifying product features.

By default, we estimate Volume = 1000 × share. We use the factor of 1000 for convenient scaling. However, if you know the actual volume of units sold in the market, you should use that instead of 1000.

Then Revenue = Price × Volume.

When calculating profit, you are able to account for both variable and fixed costs. Variable costs should be dependant on the share value, while fixed cost can simply be subtracted at the end of the formula. This gives us a profit equation of the form Profit = share x (1 - variable cost) - fixed cost.

For each NPD you are able to enter a custom formula or select from one of the default formulas using the buttons on the right-hand side. The default calculations for volume, revenue, and profit all assume a market index of 1000 units.

How can I view history in the online simulator?

The History function records all the past versions of a simulation each time they are saved, as well as the time, date, and ID of the person who saved the simulation.

Using the history function

This allows you to view and save past simulations without creating them all over again. To use the History function:

  • Click on the History button on the bottom left of the simulator.
  • Click on the version of the saved older simulations that you want to open.
  • You may choose to (i) open the old version or (ii) load individual worksheets from the old version into the latest version.
Selecting a previous save point to load
Adding worksheets from previous simulations

Remember to save your current work before loading any old version.


To see the above features of Conjoint.ly in more detail you can start experimenting with the Conjoint.ly simulator using “Example experiment 2: Preferences in cars (brand-specific)” in your example experiment library.

Here are also some suggestions for further reading:

Would you like to see more example conjoint reports? Log in to explore example reports.