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SKIM conference presentation 2011 about Menu Based ConjointNicole Huyghe (solutions-2) and John Irwing (TalkTalk) discuss a recent study where the innovative MBC technique was applied. Subject of the study was the offering of digital tv.For more info: check www.solutions2.be.
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Optimisation of Digital TV offering through Menu Based Conjoint
SKIM conference, 28 Oct 2011
John Irwin (TalkTalk) / Nicole Huyghe (solutions-2)
SET TOP BOX PRICE
MONTHLYFEE
INSTALLATION CHARGE
CONTRACTLENGTH
TalkTalk TalkTalk Plusnet BT Sky Virgin
ProductEssentials Plus
Unlimited broadband and calls + Friends &
Family MobileUnlimited Anytime
L BB + XL Phone + Talk Mobile Extra Anytime
Speed Up to 24MB Up to 24 Mb Up to 20 Mb Up to 20 Mb Up to 20 Mb Up to 10 Mb
Inclusive calls 0870/0845 Free cals
to IT customers
0870/0845 7p fiat rate on calls to
Mobiles
0870/0845 25% discount on calls to
mobiles0870/0845
0870 25% discount on calls
to mobiles
0870 Inclusive calls to Virgin
mobiles
Monthly £22.30 £28.30 £35.47 £51.40 £40.25 £41.00
Connection fee FREE FREE £0.00 £0.00 £0.00 £667.50
18 month total £372.15 £465.90 £643.45 £901.20 %688.50
18 month savngs with TalkTalk
£177.55 £435.30 £222.60 £201.60
HomeSafe network security
Generous download allowance
Will never restrict your speed
Unrestricted streaming
Free calls to 3.5+ landlines
Calling Circle
UK’s best value mobile calls
Intern. calls add-on
Speed Dial
Fibre Available
Other information- - Free security for 3
months - 12 months free security opt-out -
Originally just Essentials Expanded to include Plus & competitors ‘Inclusive’ content
Genre vs Size
Pricing: Scenarios to test
£ Y2£X1 £ Y1 £ Z1 £ X2 £ Z2 £ X3 £ Y3 £ Z3
Business questions
Optimum core YouView package?
Impact of bundling inclusive content in core
package?
Bundling by size or genre?
Take-up of bundles?
Price sensitivity of bundles?
STEP A
STEP B
Core tv packages
Channel composition/take-up
The research flow
2 TV package offers
Channels in core package
Channel bundle: size/genre
Bundle interest
Price sensitivity of bundles
WHICH APPROACH?
Routes of choice
TRADITIONAL CBC2 core packages
Inclusive channels?
Channel bundles
Different price levels
ADAPTIVE CBCIf no interest in
music?
LOW COST set top boxhigher monthly fee
£X1
Higher Cost set top boxLOW monthly fee
£ Y3
MENU BASED
CONJOINT
RESEARCH PROCESS
CORE OFFERING
STATED PREFERENC
E
MENU BASED
CONJOINT
2 core TV offerings
Inclusive content
Familiarising
Bundle concept and composition
Sample with size bundles
Sample with genre bundles
Core offering via basic questions
choice between 2 core TV offerings
preference of free channels
CORE OFFERIN
G
Set top box - £X1
Essentials package - £X2 per monthInstallation charge - £X3
Contract length - Y months
Set top box - £X4
Essentials package - £X5 per monthInstallation charge - £X6
Contract length - Y months
I would not take either of these packages
Based on the video you have just seen and the description you have just read, which, if either, of the folling packages are you most likely to take if TalkTalk offered YouView as part of a home phone, broadband & TV service?
Set top box - £X1 Essentials package - £X2 per monthInclusive content – AInstallation charge - £X3
Contract length - Y months
I would no longer be interested in this package
Assume that the package just selected was offered with [Inclusive content] A (at no extra cost), would you still be interested in this pack?All details of the pack are outlined below.
Familiarisation exercise
Stated preference of channel bundlesSTATED
PREFERENCE
STEP 1: CORE OFFERING
STATED PREFERENCE
Please read the description below for the Entertainment pack carefully.Focusing ojust on the channels that are included in this pack & ignoring the cost for now, please indicate how interested you are in subscribing to this channel pack.Please use a scale of 1 to 5, where 5 means that you are extremely interested in subscribing to this channel pack and 1 means that you are not at all interested in subscribing to it.
Please read the discription below for the Kids pack carefully. Focussing just on the channels that are included in this pack & ignoring the cost for now, please indicate how interested you are in subscribing to this channel pakc.Please use a scale of 1 to 5 , where 5 means that you are extremely interested in subscribing to this channel pack and 1 means that you are not at all interested in subscribing to it.
10 tasks4/5 channel bundles5 price points per bundleSplit sample(size vs. genre)n=500 per sample
MENU BASED
CONJOINT
On the next ten screens, you will see all of the additional channel packs together with the TalkTalk home phone, broadband & TV packages you have indicated you are moest interested in. The monthly price for each channel pack wll vary from screen to screen and we would like you to indicate whether or not you would subscribe to each channel pack at the price you see.
If you are not interested in any of the channel packs at anly of the given prices, please tick ‘None of the above’.
Below you will see the TalkTalk home broadband & TV package you have indicated you are most interested in together with all of the additional channel packs at different monthly prices. For each channel pack, please indicate whether or not you would subscribe to that channel pack at that monthly price.
If you are not interested in any of the channel packs at anly of the given prices, please tick ‘None of the above’.
Set top box - £X1 Essential packages - £X2 per monthInclusive content – AInstallation charge - £X3
Contract lenght - Y months
Entertainment pack £X1 per month
Hollywood TV pakc £Y2 per month
Knowledge pack £Z3 per month
Kids pack £V4 per month
Music pack £W4 per month
None of the above
TOTAL MONTHLY PRICE £Z
MBC ANALYSIS
ANALYSIS APPROACHES
VOLUMETRIC
ALLOCATION
SERIAL CROSS-
EFFECTS
EXHAUSTIVE
ALTERNATIVES
Predicts “volume” rather than choice
Total volume = number of items shown + none
Results in a % likelihood to buy
Focus on marginal effects
Felt counter-intuitive (total %likelihood >100%)
VOLUMETRIC
ALLOCATION
One model for each channel pack
Models marginal effects <-> combinations
SERIAL CROSS
EFFECTS
Models all possible combinations of channel packse.g. with 4 channel packs : 24 = 16
combinationse.g. with 5 channel packs : 25 = 32
combinations
Effect of each combination + marginal effects
One model
More realistic approach of decision-making
Estimation time still ok
EXHAUSTIVE
ALTERNATIVES
Utilities for the desirability of each combination: similar pattern as the count
analysis
Prices – count analysis:All channel packs were quite price sensitive
BUT:Utilities of the price levels showed less
differentiation and constraints were needed
Exhaustive alternatives: results
EXHAUSTIVE
ALTERNATIVES
RESULTS & ASSESMENT
EXHAUSTIVE ALTERNATIVES
Logical interview process & answers!
Simple programmming exercise
Analysis : intensive exerciseWhich model to use?CSV fileDummy variablesCovariance matrixMatching utilities with counts results
EXHAUSTIVE ALTERNATIVES
Actionable findings
Low cost set top box & higher monthly fee vs. higher cost set top box & low monthly fee
Impact off inclusive content on set top box choice
‘Buy through’ by:
• Content model• Pay TV vs Freeview households• Set top box choice
Questions?
John Irwin [email protected] Huyghe [email protected]