16. special occ.
Under $10
Bitter
Classy
sexy ads
0-14% alcohol
Collectable
Party
Smooth
sophisticated
Sweet
Home
good ad
Slim Bottle
Common
International
Unpopular
Mixer
preference
Heineken
Patron
BUD
barefoot
PBR
Burnett’s
Smirnoff
Miller
Sutter home
Guinness
Events
23. Conjoint Analysis
Conjoint Analysis: technique used to determine how
people value different attributes (numerical value)
Conjoint Analysis will calculate market share & help
determine market barriers
Problem: Smirnoff wants to increase market
share
Goal: Gain more market share in industry
24. Statistical Quality of
Product
Adjust R squared: 0.39768 – explains
about 39% of customers’ preferences
Significance F: 2.26E-41 – the result of
our data was not due to chance or luck
31. Current TPU
Smirnoff Barefoot Patron
$ 10 to $20 Under $10 Under $10
Sweet Sweet Smooth
Party Classy Party
Sexy Sexy Sporty
%15 to %20 15% to 20% 21% +
Collectible Collectible Stubby
Party Special Occasion Special Occasion
Total TPU = .75 Total TPU = 1.01 Total TPU = 1.09
33. Market Share Calculations
Smirnoff -> exp( .75) / exp(1.01) + exp(1.09) + exp(.75) =
27%
• Exponential Function of Smirnoff = 2.12
• Exponential Function of Barefoot = 2.75
• Exponential Function of Patron = 2.97
Barefoot -> 2.75 / 2.75 + 2.12 + 2.97 = 35%
Patron -> 2.97 / 2.97 + 2.75 + 2.12 = 38%
34. NEW TPU
Smirnoff Barefoot Patron
$ 10 to $20 Under $10 Under $10
Sweet Sweet Smooth
Party Classy Party
Sexy Sexy Sporty
%15 to %20 15% to 20% 21% +
Collectible Collectible Stubby
Home Special Occasion Special Occasion
Total TPU = 1.04 Total TPU = 1.01 Total TPU = 1.09
37. MARKET REACTS
Smirnoff Barefoot Patron
$ 10 to $20 Under $10 Under $10
Sweet Sweet Smooth
Party Classy Party
Sexy Sexy Sporty
%15 to %20 15% to 20% 21% +
Collectible Collectible Stubby
Home Party Special Occasion
Total TPU = 1.04 Total TPU = .85 Total TPU = 1.09
OWEN
INTRO
Hired: Smirnoff wants to increase market share
OWEN
INTRO – what tools we used to assess and reposition product = perceptual map & conjoint analysis
Owen
INTRO
Mia
demographics
Mia
Demographics
32% of people are single & tie between complicated and committed relationship at 28%
Mia
Demographics
52% were caucasian
Mia
Behavior
52% spend $75 to $100 a month on consumption
Mia
Behavior
IMPORTANT TO POINT OUT: HOME IS THE MOST PREFERED PLACE TO CONSUME – let Dr. V know that this will tie into conjoint analysis
Mia
Behavioral
IMPORTANT TO POINT OUT SMOOTH IS HIGHEST TASTE PREFERENCE – let Dr. V know that this will also tie into conjoint analysis
Mia
Behavioral
Mia
Perceptual mapping – different brands in the market
Mia
Perceptual mapping – attributes of smirnoff
Mia
Perceptual mapping
Sehar
Perceptual mapping – grand map
Primary: sophisticated, not sweet, good taste, home
Secondary: good ad, 5% alcohol
Sehar
Perceptual mapping – clusters
In the same cluster = competing directly
Different cluster = competing indirectly
Sehar
Perceptual mapping – brand preference
90 degree angle – shows how preferred each brand is / the farther the projection fall on preference vector in the direction of increasing preference, the more preferred the brand is
Sehar
Perceptual mapping – gaps & spaces
Sehar
Perceptual mapping – name the axes
Sehar
Perceptual mapping – quick summary of primary attributes
Sehar
Perceptual mapping – quick summary of secondary attributes
Patrycia
Conjoint Analysis – restate the problem
Patrycia
Conjoint Analysis – statistical quality of product
Patrycia
As we saw with the perceptual map: HOME, smooth, and sophisticated are the closest to the preference line and have the high utilities.
HOME has the highest utility, which means that it’s the most important attribute. As we saw in the surveys it was the most preferred setting to consume alcohol.
has the highest TPU, which makes it the most important attribute (highest value),
Conjoint Analysis – bar graph
Patrycia
Conjoint Analysis – > People are NOT rational about price – NON linear
Patrycia
What this means is that the product must be greater than 1 in order to compete in the product.
Conjoint Analysis – intercept / explain what it means
Patrycia
Optimal product is 1.41, greater than 1 than it can compete in the market place
Conjoint Analysis – best product
Patrycia
Least preferred product is less than 1, so it can’t compete in the market – which makes sense
Conjoint Analysis – worst product
Patrycia
- Setting is the most important and style is also important, home and sophisticated were close to the preference line as you saw in the perceptual map
Conjoint Analysis – compare attributes closest to the preference line
Patrycia
Conjoint Analysis – added the utilities from the bar graph to get the TOTAL TPU
Patrycia
Conjoint Analysis – current market share
Patrycia
Conjoint Analysis – calculations / don’t need to talk about it unless she asks in class
Patrycia
Conjoint Analysis – NEW TPU
Patrycia
Patrycia
Conjoint Analysis – Setting was the most important attribute so we changed from party to home. We changed the setting in order to catch up with the competition.
Patrycia
Conjoint Analysis – Changed most important attribute setting / from special occasion to party
Patrycia
Patrycia
Conjoint Analysis – simulated market based on CA
Sehar
Conjoint Analysis – after simulating market the updated market share is
Sehar
Feature – setting – most important attribute is home
Sehar
Conjoint Analysis – CA & PM
Sehar
Conjoint Analysis – CA & PM contradict each other – explain why
