Pricing the business holistically – looking across all products and services and through multiple lines of business – is complex. So is understanding the trade-off between potential features and benefits to add to a new product offer. Discrete choice research allows you to mimic real-world environments and the decision process consumers use to make choices.
Conjoint and Discrete Choice Research
“How much pricing power do we have? How should we bundle our products and services to optimize profit? Which features and benefits deliver the strongest product?Pricing the business holistically – looking across all products and services and through multiple lines of business – is complex. So is understanding the trade-off between potential features and benefits to add to a new product offer. Discrete choice research allows you to mimic real-world environments and the decision process consumers use to make choices.
Benefits of Conjoint Analysis and Discrete Choice Research – Case Study
Walt Disney World in Orlando, Florida offers four theme parks, two water parks, a sports complex, Disney Springs (a retail, dining and entertainment complex) and over 25 resort hotels, all located within nearly 40 square miles. To determine how best to move guests throughout the property on a daily basis, Disney conducted discrete choice transportation research encompassing mode of transportation (bus, monorail, ferry, gondola, autonomous vehicles), access locations, number of stops to final destination, time to destination, and association with resort hotels to determine the optimal mix and implied pricing power for average daily rate at hotels.
Casino Loyalty Discrete Choice – Case Study
Through discrete-choice research, Integrated Insight developed a tiered loyalty program for Carnival Cruise Line casino players, testing numerous benefits such as free play, free food and beverage, onboard credits, and discounts on future cruises. The research allowed us to test many benefits among multiple tiers of players to determine which benefits were most impactful in incenting first time cruisers, improving frequency of sailing, and producing higher spend per cruise.
When to Use Discrete Choice Research
Discrete Choice research is most helpful when:
– Products and services are intertwined such that consumers are making trade-off decisions in their real-world decisions.
– The impact of not getting it right can be significant. If wrong, a serious loss of income will occur or, significant value will be left on the table.
– The cost to build a new product or introduce a new service is substantial and being certain the right benefits and features are introduced is critical.
– There is strong competition in the market, and you need to know how much share you can steal.
The Integrated Insight Difference
– Each discrete choice project is customized to your needs, but we encourage you to examine the business holistically and study key competitors.
– We calibrate the research results back to your current demand and revenue by incorporating current products and pricing into the design. This allows us to eliminate any overstatement due to the research itself, and only measure true incremental change to the base business.
– Our models are built to provide guidance and insight over multiple pricing cycles. This allows for more strategic planning with other initiatives.
– Both current and potential products and services can be studied in the same design, isolating the impact of the new products on the existing offering.
– We stay with you through implementation. While most risk is managed through the design, we are able to make immediate adjustments where needed.
Need to conduct conjoint and discrete choice research?
