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Advanced Quant Techniques July 14, 2011
ACBC Case Study
Stefan Binner, bms marke;ng research + strategy
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
ACBC Case Study Stefan Binner Advanced Quant Webinar - July 14, 2011
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
In 2009 Sawtooth Software launched ACBC (Adaptive Choice Based Conjoint) As many researchers we expected a new “power tool” and increased value for our projects. Following presentation report our experience illustrated with base case from a commercial study…
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Case Study: Background ü Chemical Product for DIY market ü 14 attributes including price, many non compensatory
attributes ü Difficult to find target group (“Moonlighters”)
=> small sample N=200 ü Objective: Product development & identification of best USP ü No focus on price
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
“Unacceptable” Questions “Must-‐Have” Questions
Build Your Own SectionScreening Section
(Respondent answers 6 screens like this)
Choice Tasks
Interview Progress
Design Considerations ACBC
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations ACBC Parameter Settings
Case Study:
13
8 4 3 18 6 3 3 6
mixed
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations ACBC Parameter Settings
Parameters Number of Attributes w/o price # of Screening Tasks # of Must Haves # of Unacceptables Max. # of Concepts in Choice T # of Calibration Concepts # of Concepts / Screening task Min. Attributes to vary from BYO Max. Attributes to vary from BYO BYO Modification Strategy
Case Study
13 8 4 3 18 6 3 3 6
mixed
Given by the nature of the project – required by customer
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations ACBC Parameter Settings
Parameters Number of Attributes w/o price # of Screening Tasks # of Must Haves # of Unacceptables Max. # of Concepts in Choice T # of Calibration Concepts # of Concepts / Screening task Min. Attributes to vary from BYO Max. Attributes to vary from BYO BYO Modification Strategy
Case Study
13 8 4 3 18 6 3 3 6
mixed
8 x 3 = 24 concepts seen as sufficient (interview length!)
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations ACBC Parameter Settings
Parameters Number of Attributes w/o price # of Screening Tasks # of Must Haves # of Unacceptables Max. # of Concepts in Choice T # of Calibration Concepts # of Concepts / Screening task Min. Attributes to vary from BYO Max. Attributes to vary from BYO BYO Modification Strategy
Case Study
13 8 4 3 18 6 3 3 6
mixed
Less than suggested by Sawtooth. Intention: to avoid too many MH or UA
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations ACBC Parameter Settings
Parameters Number of Attributes w/o price # of Screening Tasks # of Must Haves # of Unacceptables Max. # of Concepts in Choice T # of Calibration Concepts # of Concepts / Screening task Min. Attributes to vary from BYO Max. Attributes to vary from BYO BYO Modification Strategy
Case Study
13 8 4 3 18 6 3 3 6
mixed
Less than suggested by Sawtooth (Interview lengths!)
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations ACBC Parameter Settings
Parameters Number of Attributes w/o price # of Screening Tasks # of Must Haves # of Unacceptables Max. # of Concepts in Choice T # of Calibration Concepts # of Concepts / Screening task Min. Attributes to vary from BYO Max. Attributes to vary from BYO BYO Modification Strategy
Case Study
13 8 4 3 18 6 3 3 6
mixed
Used Sawtooth recommendation
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations ACBC Parameter Settings
Parameters Number of Attributes w/o price # of Screening Tasks # of Must Haves # of Unacceptables Max. # of Concepts in Choice T # of Calibration Concepts # of Concepts / Screening task Min. Attributes to vary from BYO Max. Attributes to vary from BYO BYO Modification Strategy
Case Study
13 8 4 3 18 6 3 3 6
mixed
Screen Size Limitation Complexity
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations ACBC Parameter Settings
Parameters Number of Attributes # of Screening Tasks # of Must Haves # of Unacceptables Max. # of Concepts in Choice T # of Calibration Concepts # of Concepts / Screening task Min. Attributes to vary from BYO Max. Attributes to vary from BYO BYO Modification Strategy
Case Study
13 8 4 3 18 6 3 3 6
mixed
More than suggested by Sawtooth
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations ACBC Parameter Settings
Parameters Number of Attributes # of Screening Tasks # of Must Haves # of Unacceptables Max. # of Concepts in Choice T # of Calibration Concepts # of Concepts / Screening task Min. Attributes to vary from BYO Max. Attributes to vary from BYO BYO Modification Strategy
Case Study
13 8 4 3 18 6 3 3 6
mixed
Sawtooth recommendation
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations Prohibitions
Initial prohibitions led to huge design problems No Standard Tool to “test design efficiency” in ACBC => Be careful and avoid as possible
" Only one prohibition was used
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations Price Attribute
v Price range +/- 50%
v Rounded to 99 cents
v Prices was used in unacceptable section
v Level Prices for selected attribute levels were used in 7 of 13 non price attributes
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Design Considerations Holdout Tasks
§ No easy holdout tasks like in CBC
§ Calibration concept no substitute for holdout tasks
§ Possible Solution: Use one random tournament question as holdout
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Pre Testing N = 20 Pretest
§ Internal Pre-Test indicated too long and complex interviews
§ Real Pre-Test were promising: respondents liked the questions and found good sense in them
§ => we increased the number of questions slightly
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Field Work N = 200 face-to-face CAPI
§ Good response
§ Happy respondents
§ Relevant questions
§ Positive feedback
§ Average duration around 30 minutes
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Results Utility Values
§ Individual level utilities calculated with HB § All results met common sense expectations § Some surprises and hints for segmentation
-100
-80-60
-40-20
0
2040
6080
100
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Results Price
§ Linear price function result in very large price interval with only few data points at the end of the interval (base price + all possible level prices +/- 50%)
§ Use of piecewise price function with 5 data points
§ Check data! (get_acbc_prices.exe tool)
§ Rather flat price elasticity which needed calibration
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Results Price
§ Due to the large interval price the IMPORTANCE of might gets over-estimated
0
5
10
15
20
25
30
35
Att
1
Att
2
Att
3
Att4
Att5
Att6
Att7
Att8
Att9
Att1
0
Att1
1
Att1
2
Att1
3
Pric
e
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Results Price
§ Despite non price focus of project a calibration of PRICE ELASTICITY seem to be necessary
0
10
20
30
40
50
60
70
P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11 P12 P13 P14 P15 P16 P17 P18 P19 P20 P21 P22 P23 P24
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Results Simulations
§ Base Case scenario tuned to current market shares
§ Best attribute levels search based on Profit Contribution modeling
§ Product optimization
§ Product range optimization
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Results Example for Product Optimisation
20
30
40
50
60
70
P1 P2 P3 P4 P5 P6 P7 P8 P9 P10 P11 P12 P13 P140,25
0,5
0,75
1
1,25
1,5
SOP BCSOP IMPPC1 BCPC1 IMP
SOP PC1
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Results Benefits of the Study
§ Definition for new product development
§ Improvement of package design
§ Optimization of Product range
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Lessons Learned ACBC Pro
§ Intuitive to clients
§ Realistic and relevant interview for respondents
§ Smaller sample size possible
§ Reliable results
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Lessons Learned ACBC Con
§ Price range definition
§ Lack of Alternative Specific Designs
§ Danger of prohibitions
§ Measurement and simulation of price elasticity
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Limitations No Alternative Specific Designs Limited Graphics Flat price elasticity Lack of experience Difficult design decisions
Model Scenarios Complex product features and options Non-Compensatory Attributes Many Attributes Small Sample Available (CPI, B2B) Deeper insights on individual level
Markets Industrial B2B Durables
Conclusions ACBC Application
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
A new tool in the MR Toolbox!!
CBC ACA M-D CVA
ü Rarely used ü Traditional
ü Not CJ ü M. Attributes ü Efficient
ACBC
ü Attributes ++ ü Non compensatory ü Realistic interview ü Weak on pricing ü Individual level ü Small sample
ü Mostly used ü Full Profile ü ADM ü Strong for Pricing ü Ind. level (HB) ü IIA
ü Adaptive ü Attributes++ ü Weak on Pricing ü Ind. Level
According to the latest “Report on Conjoint Analysis Usage among Sawtooth Software Customers” 9% of all projects are done with ACBC
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Ü ACBC study was great success
Ü ACBC is intuitive to clients and respondents
Ü ACBC will not replace CBC or other methods but it will become an additional tool
So what?
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011
Questions ?
Stefan Binner bms
Sue York The Future Place
Stefan Binner, bms-marketing research + strategy, Germany NewMR Advanced Quant Techniques, July 14, 2011