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:

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

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:

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.

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.

New product launch simulations

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

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.

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

FAQs

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:

• What is conjoint analysis?
• Top tips for specifying attributes and levels in conjoint analysis
• Example report on preferences in ice-cream

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