Incentive-aligned conjoint analysis

Min Ding, Rajdeep Grewal, John C. Liechty

Research output: Contribution to journalReview article

141 Citations (Scopus)

Abstract

Because most conjoint studies are conducted in hypothetical situations with no consumption consequences for the participants, the extent to which the studies are able to uncover "true" consumer preference structures is questionable. Experimental economics literature, with its emphasis on incentive alignment and hypothetical blas, suggests that more realistic incentive-aligned studies result in stronger out-of-sample predictive performance of actual purchase behaviors and provide better estimates of consumer preference structures than do hypothetical studies. To test this hypothesis, the authors design an experiment with conventional (hypothetical) conditions and parallel incentive-aligned counterparts. Using Chinese dinner specials as the context, the authors conduct a field experiment in a Chinese restaurant during dinnertime. The results provide strong evidence in favor of incentive-aligned choice conjoint analysis, in that incentive-aligned choice conjoint outperforms hypothetical choice conjoint in out-of-sample predictions. To determine the robustness of the results, the authors conduct a second study that uses snacks as the context and considers only the choice treatments. This study confirms the results by providing strong evidence in favor of incentivealigned choice analysis in out-of-sample predictions. The results provide a strong motivation for conjoint practitioners to consider conducting studies in realistic settings using incentive structures that require participants to "live with" their decisions.

Original languageEnglish (US)
Pages (from-to)67-82
Number of pages16
JournalJournal of Marketing Research
Volume42
Issue number1
DOIs
StatePublished - Feb 1 2005

Fingerprint

Conjoint analysis
Incentives
Consumer preferences
Preference structure
Out-of-sample forecasting
Robustness
Chinese restaurant
Purchase behavior
Experiment
Hypothesis test
Incentive alignment
Field experiment
Incentive structure
Experimental economics

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Economics and Econometrics
  • Marketing

Cite this

Ding, Min ; Grewal, Rajdeep ; Liechty, John C. / Incentive-aligned conjoint analysis. In: Journal of Marketing Research. 2005 ; Vol. 42, No. 1. pp. 67-82.
@article{18eaa26ee2ef4f93afe308fa368dc5af,
title = "Incentive-aligned conjoint analysis",
abstract = "Because most conjoint studies are conducted in hypothetical situations with no consumption consequences for the participants, the extent to which the studies are able to uncover {"}true{"} consumer preference structures is questionable. Experimental economics literature, with its emphasis on incentive alignment and hypothetical blas, suggests that more realistic incentive-aligned studies result in stronger out-of-sample predictive performance of actual purchase behaviors and provide better estimates of consumer preference structures than do hypothetical studies. To test this hypothesis, the authors design an experiment with conventional (hypothetical) conditions and parallel incentive-aligned counterparts. Using Chinese dinner specials as the context, the authors conduct a field experiment in a Chinese restaurant during dinnertime. The results provide strong evidence in favor of incentive-aligned choice conjoint analysis, in that incentive-aligned choice conjoint outperforms hypothetical choice conjoint in out-of-sample predictions. To determine the robustness of the results, the authors conduct a second study that uses snacks as the context and considers only the choice treatments. This study confirms the results by providing strong evidence in favor of incentivealigned choice analysis in out-of-sample predictions. The results provide a strong motivation for conjoint practitioners to consider conducting studies in realistic settings using incentive structures that require participants to {"}live with{"} their decisions.",
author = "Min Ding and Rajdeep Grewal and Liechty, {John C.}",
year = "2005",
month = "2",
day = "1",
doi = "10.1509/jmkr.42.1.67.56890",
language = "English (US)",
volume = "42",
pages = "67--82",
journal = "Journal of Marketing Research",
issn = "0022-2437",
publisher = "American Marketing Association",
number = "1",

}

Incentive-aligned conjoint analysis. / Ding, Min; Grewal, Rajdeep; Liechty, John C.

In: Journal of Marketing Research, Vol. 42, No. 1, 01.02.2005, p. 67-82.

Research output: Contribution to journalReview article

TY - JOUR

T1 - Incentive-aligned conjoint analysis

AU - Ding, Min

AU - Grewal, Rajdeep

AU - Liechty, John C.

PY - 2005/2/1

Y1 - 2005/2/1

N2 - Because most conjoint studies are conducted in hypothetical situations with no consumption consequences for the participants, the extent to which the studies are able to uncover "true" consumer preference structures is questionable. Experimental economics literature, with its emphasis on incentive alignment and hypothetical blas, suggests that more realistic incentive-aligned studies result in stronger out-of-sample predictive performance of actual purchase behaviors and provide better estimates of consumer preference structures than do hypothetical studies. To test this hypothesis, the authors design an experiment with conventional (hypothetical) conditions and parallel incentive-aligned counterparts. Using Chinese dinner specials as the context, the authors conduct a field experiment in a Chinese restaurant during dinnertime. The results provide strong evidence in favor of incentive-aligned choice conjoint analysis, in that incentive-aligned choice conjoint outperforms hypothetical choice conjoint in out-of-sample predictions. To determine the robustness of the results, the authors conduct a second study that uses snacks as the context and considers only the choice treatments. This study confirms the results by providing strong evidence in favor of incentivealigned choice analysis in out-of-sample predictions. The results provide a strong motivation for conjoint practitioners to consider conducting studies in realistic settings using incentive structures that require participants to "live with" their decisions.

AB - Because most conjoint studies are conducted in hypothetical situations with no consumption consequences for the participants, the extent to which the studies are able to uncover "true" consumer preference structures is questionable. Experimental economics literature, with its emphasis on incentive alignment and hypothetical blas, suggests that more realistic incentive-aligned studies result in stronger out-of-sample predictive performance of actual purchase behaviors and provide better estimates of consumer preference structures than do hypothetical studies. To test this hypothesis, the authors design an experiment with conventional (hypothetical) conditions and parallel incentive-aligned counterparts. Using Chinese dinner specials as the context, the authors conduct a field experiment in a Chinese restaurant during dinnertime. The results provide strong evidence in favor of incentive-aligned choice conjoint analysis, in that incentive-aligned choice conjoint outperforms hypothetical choice conjoint in out-of-sample predictions. To determine the robustness of the results, the authors conduct a second study that uses snacks as the context and considers only the choice treatments. This study confirms the results by providing strong evidence in favor of incentivealigned choice analysis in out-of-sample predictions. The results provide a strong motivation for conjoint practitioners to consider conducting studies in realistic settings using incentive structures that require participants to "live with" their decisions.

UR - http://www.scopus.com/inward/record.url?scp=14844283860&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=14844283860&partnerID=8YFLogxK

U2 - 10.1509/jmkr.42.1.67.56890

DO - 10.1509/jmkr.42.1.67.56890

M3 - Review article

VL - 42

SP - 67

EP - 82

JO - Journal of Marketing Research

JF - Journal of Marketing Research

SN - 0022-2437

IS - 1

ER -