Learn all about conjoint analysis in this guide by Survey Analytics. While we focus on choice-based conjoint because it is the most common, you can also learn about what it can be used for and how to conduct it in your research.

1. Conjoint Analysis
Conduct Pricing
Research Effectively

2. What is Conjoint Analysis?
Conjoint analysis is a statistical technique used in market research to
determine how people value different features of a product or service.
Also referred to as a trade-off analysis, conjoint is used determine what
combinations of attributes is most influential on a respondents’ choice or
decision-making.
By analyzing how respondents make preferences based on a controlled
set of potential products and services, the implicit valuations (utilities or
parts-worth) of each attribute can be determined. The utilities or parts-worth
values can then be used to simulate the estimated market share as
well as potential revenue and profits of new products or services.
Survey Analytics specializes in Choice-Based Conjoint (CBC). It is the most
popular conjoint-related technique in use today. This is primarily because
it is modeled after consumer behavior in real-life. Most purchases that
consumers make are basically trade-off based.
If someone is planning a trip to Hawaii, will they book a garden view room
for $125/night, a partial ocean view room for $175/night, or a full ocean
view room with a balcony for $225/night? This will depend on the type of
person, as well as how much they are willing and able to spend.

3. Why do I need Conjoint Analysis?
By using conjoint analysis in the initial product innovation phase, the days
of spending loads of money to create products and putting it directly in the
market are over. The use of conjoint analysis will offer data to help
determine the direction new products and services could potentially take
before heavily investing company resources.
Conjoint analysis isn’t just for the idea phase. You can use it in all phases of
bringing a new product or service to market, or you can use it with existing
product or services to determine estimated market share among your
competitors while discovering what things about certain products
influences a respondents’ choice or decision-making.
When specifically using choice-based conjoint, it quantifies the act of
watching a person at the store trying to decide which kind of laundry
detergent to purchase or which toothpaste to buy. And based on the
answers given, one can then make a recommendation for new products or
services and at what price point to offer it to achieve gains in market share.

4. How do I conduct Choice-Based Conjoint?
The first thing you must do before creating a conjoint question in your
survey is to clearly define the features and attributes for your study. If
you cannot clearly define your features and attributes, or if your list
appears to be extremely long, then you will need to do pre-conjoint
research to determine your list of features and attributes.
Features are different components that make up a product or service.
Attributes, also known as levels, are varying elements within each
component.
If using a Hawaiian vacation package as an example, your rooms, flights,
activities, and car rental are features of a conjoint analysis question. The
attributes of a room are full ocean view, partial ocean view, and garden view,
while activities attributes are snorkeling, swimming with turtles, or a booze
cruise.

5. How do I conduct Choice-Based Conjoint?
As a general rule of thumb, use no more than 5-7 features and 5-7
attributes per feature. There may be exceptions to this rule, depending
on respondent size and how you want to use the data.
Once that is done, you can add your conjoint instructions, features and
levels into the question. Next, you will want to set up your task counts and
concepts per task. After this, you may want to update prohibited pairs,
add an n/a option, include fixed tasks, and select the best design option for
your study. Survey Analytics supports Random, D-Optimal (beneficial for
small respondent groups), and Import design options for choice based
conjoint analysis.

6. How to analyze Choice-Based Conjoint
To analyze the conjoint data collected in Survey Analytics, go to the
Reports Tab, select "Choice Modeling" and then "Conjoint Analysis".
There is an option to analyze the entire report or based on applied
data filters or segmentation.
What is Part-Worths?
Part-worths means level utilities for conjoint attributes. When multiple
attributes come together to describe the total worth of the product
concept, the utility values for the separate parts of the product (assigned
to the multiple attributes) are part-worths.
The final parts-worth are re-scaled so that the part-worths for any
attribute have a mean of zero, simply by subtracting the mean of the part-worths
for all levels of each attribute. The higher the part-worth values
within the feature set, the more preferred it was among the response
group.
Example: Vacationers booking a trip to Hawaii prefer to book ocean view
rooms, then garden view rooms, then rooms with no view.

7. What is Relative Importance?
For each Attribute, the difference between the highest and the lowest Part-
Worth is calculated. This value, divided by the total across all the attributes,
is the relative importance. This percentage value will identify the feature
that most influences a respondent’s preference for a particular product or
service.
Example: When choosing a vacation package to Hawaii, room type was the
feature that most influenced a respondent’s preference among different
packages presented.
In addition to the relative importance and parts-worth chart, Survey
Analytics offers a market simulator tool, which will allow you to simulate
other product options and view estimated market share, as well as various
download options for further analysis.
Relative Importance and Parts-Worth Table:

8. Survey Analytics about us
We help companies listen.
At Survey Analytics, surveys are just a small piece of the puzzle. We help
companies listen through our suite of powerful and interconnected DIY
research tools. Our platform gives you the actionable reports you need to
engage with your audience. With real-time analytics and customizable
dashboards, you can see the information that you need to make the right
decisions.
Aside from surveys, we offer high quality panel and community building
software as well as a variety of tools for developers such as API calls to
Salesforce and a mobile survey SDK. Our platform adheres to the highest
levels of security to protect your valuable information. We support 44
languages and are currently helping clients in 15 countries and 30 different
industries.
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