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Conjoint Optimization: An Exact Branch-and-Bound Algorithm for the Share-of-Choice Problem

Author

Listed:
  • Jeffrey D. Camm

    (Department of Quantitative Analysis and Operations Management, University of Cincinnati, Cincinnati, Ohio 45221)

  • James J. Cochran

    (Department of Marketing and Analysis, Louisiana Tech University, Ruston, Louisiana 71272)

  • David J. Curry

    (Department of Marketing, University of Cincinnati, Cincinnati, Ohio 45221)

  • Sriram Kannan

    (Sabre Travel Technologies, Bangalore, India)

Abstract

Conjoint analysis is a statistical technique used to elicit partworth utilities for product attributes from consumers to aid in the evaluation of market potential for new products. The objective of the share-of-choice problem (a common approach to new product design) is to find the design that maximizes the number of respondents for whom the new product's utility exceeds a specific hurdle (reservation utility). We present an exact branch-and-bound algorithm to solve the share-of-choice problem. Our empirical results, based on several large commercial data sets and simulated data from a controlled experiment, suggest that the approach is useful for finding provably optimal solutions to realistically sized problems, including cases where partworths contain estimation error.

Suggested Citation

  • Jeffrey D. Camm & James J. Cochran & David J. Curry & Sriram Kannan, 2006. "Conjoint Optimization: An Exact Branch-and-Bound Algorithm for the Share-of-Choice Problem," Management Science, INFORMS, vol. 52(3), pages 435-447, March.
    • Handle: RePEc:inm:ormnsc:v:52:y:2006:i:3:p:435-447
    DOI: 10.1287/mnsc.1050.0461
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    References listed on IDEAS

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