As a local video store struggles with competition from Netflix and video-on-demand, how can a conjoint analysis help the owners to determine which plan will ensure the store remains competitive?
As a local video store struggles with competition from Netflix and video-on-demand, how can a conjoint analysis help the owners to determine which plan will ensure the store remains competitive?
The family-owned Montclair Video attracted loyal customers by providing a wide selection of movies and personalized recommendations, helping it fend off competition from movie-rental giant Blockbuster. That changed with the increasing popularity of Netflix, as well as a rise in on-demand cable content and the introduction of a similar pricing model from Blockbuster. The family was prepared to adopt new pricing and add rental services, but only if the strategy made financial sense. Upon the advice of a market research consultant, the owners launched a survey of store customers which utilized a choice-based conjoint analysis format. In this case students examine competitors' plans and analyze data from this survey to determine which services and fees will prove profitable while retaining clients.
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