Market Analysis

alternative | price |   | brand |   | region |   |

| $10 | $15 | well known | not well known | well known | not well known |

1 | 1 | 0 | 1 | 0 | 0 | 1 |

2 | 1 | 0 | 1 | 0 | 1 | 0 |

3 | 1 | 0 | 0 | 1 | 0 | 1 |

4 | 1 | 0 | 0 | 1 | 1 | 0 |

5 | 0 | 1 | 1 | 0 | 0 | 1 |

6 | 0 | 1 | 1 | 0 | 1 | 0 |

7 | 0 | 1 | 0 | 1 | 0 | 1 |

8 | 0 | 1 | 0 | 1 | 1 | 0 |

The alternatives where 1 represents the existence of the attribute, 3 attributes with 2 choices, 2 X 2 X 2 = 8 alternatives.

  |   | Region | Brand | Price |   |   | Exponential | Choice |

Alternative | b0 | b1 | b2 | b3 | Utility | Alternative | of utility | Probability |

1 | 0 |   |   |   | 0.0000 | 1 | 1.0000 | 6% |

2 | 0 | | | -2.0420 | -2.0420 | 2 | 0.1298 | 1% |

3 | 0 | | 0.8513 | | 0.8513 | 3 | 2.3426 | 13% |

4 | 0 | | 0.8513 | -2.0420 | -1.1907 | 4 | 0.3040 | 2% |

5 | 0 | 1.3100 | | | 1.3100 | 5 | 3.7062 | 21% |

6 | 0 | 1.3100 | | -2.0420 | -0.7320 | 6 | 0.4809 | 3% |

7 | 0 | 1.3100 | 0.8513 | | 2.1613 | 7 | 8.6822 | 49% |

8 | 0 | 1.3100 | 0.8513 | -2.0420 | 0.1193 | 8 | 1.1267 | 6% |

| | | | | | | 17.7724 | 100% |

Coefficient Values |   |   |

Partworths |   |   |

Constant | b0 | 0 |

Well known region | b1 | 1.31 |

Well known brand | b2 | 0.8513 |

Higher price | b3 | -2.0420 |

loglikelihood |

-1256.32 |   |

The best alternative for the new product would be to use the alternative of not well known region, not well known brand and a price of $15. The highest choice probability according to the analysis comes from this and so, this would be the better choice. Also, as the well known brand-well-known region at $10 as well as well known region not well known brand at $10 already have competitors. The above choice would be the best alternative for the brand due to the fact that it would have the least number of competitors. Also, with a niche market, it could appeal to a certain group and have its own customer base.

The hardest...