Anocha Aribarg

Understanding the role of preference revision and concession in group decisions

In this article, the authors contend that member influence in a groups decision could be decomposed into two distinct elements of preference revision and concession. Using a hierarchical Bayes model of dyadic decision making, the authors show that the degree of preference revision and concession varies across product attributes, individuals, and product categories. The authors demonstrate that converging preferences affect a members concession, which in turn affects members’ satisfaction with the joint decision. More important, a members satisfaction is higher when his or her concession is reciprocated.

Research Note---Interbrand Variant Overlap: Impact on Brand Preference and Portfolio Profit

Firms often carry a portfolio of multiple brands within a product category to target different quality tiers in the market. Furthermore, to satisfy heterogeneous consumer preferences within each quality tier, these firms also offer several variants for each brand. A natural outcome of this practice is interbrand variant overlap that could occur across tiers or within a tier. In this paper, we show that across-tier variant overlap is likely to diminish the preference of an upper-tier brand and enhance the preference of a lower-tier brand. We also find that variant overlap within a tier is likely to increase preferences of a brand belonging to the tier. Such variant overlap effects have important brand portfolio management implications for a multibrand firm. Specifically, we demonstrate that such a firm can enhance its portfolio profit under certain conditions by pruning its variants to reduce variant overlap. Because our paper relies on aggregate data, future research should investigate variant overlap at the individual level using panel or experimental data.

Category-Based Screening in Choice of Complementary Products

Consumers often make complex choices involving complementary categories, such as cell phones and service plans. In the fast-growing high-tech and entertainment industries, products from complementary categories are often incompatible with one another. This research shows that when choosing a pair of such complementary products, a consumer is likely to use a two-stage decision strategy: screening by one category first to narrow down the number of pairs for further evaluation in the second stage. In the presence of incompatibility, screening by one category rather than by the other may lead to different choice outcomes. The authors develop a behavioral theory–driven choice model that accounts for both preference heterogeneity and structural heterogeneity of decision strategies to examine the extent to which consumers engage in category-based screening. Analysis of data from a 2 × 2 conjoint choice experiment reveals that consumers tend to screen a category that has higher intracategory differentiation and is congruent with their decision goals. The authors further suggest possible marketing actions a firm can take to promote the use of a specific decision strategy that leads consumers to choose its product.

Brand Portfolio Promotions

Large firms implement brand portfolio promotions (BPPs) that promote multiple brands to targeted consumers at discrete times. Such programs possess unique properties that require a novel model to assess their effectiveness. The authors propose a model that captures the magnitude and shape of the BPP effect for each brand in the portfolio, accounts for diminishing returns of brand exposure, and incorporates the intertemporal effect of BPPs. The model is shown to be general enough to apply to any discrete promotion in which the carryover effect duration is unknown. The authors present several model-based metrics that allow for an objective comparison of a BPPs return on investment with that of other forms of promotion. The results suggest that a BPP, when contrasted with feature, leads to higher sales lift per household for some of the brands. The authors develop an optimal exposure allocation procedure based on the proposed model that informs (1) which assortments of brands to promote across multiple BPPs and (2) the exposure level for each brand.

Tipping the Scale: The Role of Discriminability in Conjoint Analysis

Conjoint analysis is a widely used method for determining how much certain attributes matter to consumers by observing a series of their choices. However, how those attributes are expressed has important consequences for their choices and thus for conclusions drawn by market researchers about attribute importance. Expanded attribute scales (e.g., expressing exercise time in minutes) leads consumers to perceive greater differences between scale levels than contracted scales (e.g., expressing exercise time in hours). The authors show in two domains that simply expanding an attributes scale can shift choice toward alternatives that perform well on a scale that is expanded and thus can impact conjoint results such as attribute importance and screening. Thus, practitioners should take care when they choose precisely how to elicit preferences or how to describe their products: the extent of the scales expansion will determine researchers’ inferences about the importance of the attribute it describes. By illustrating the curvilinear relationship between scale expansion and multiple measures, the authors also offer practitioners some insight into the limits of scale expansion.