Conjoint Analysis: Maximize the Value in Membership-Based Businesses

Introduction to Conjoint Analysis

Conjoint analysis, also known as Lego analysis, is a survey-based statistical technique used in market research. It helps determine how people value different attributes (features, functions, benefits) that make up a product or service. By breaking a product into its parts, similar to a Lego house made from many bricks, and asking people to evaluate them separately or in different combinations, conjoint analysis offers valuable insights. For example, if you offer a freemium model and want to scale your business, conjoint analysis can reveal which features users value most. You might then choose to put that feature behind a paywall. Additionally, this method helps you set the right prices and determine what features each price tier should include.

Ideal Applications of Conjoint Analysis

This method is particularly useful for businesses with a membership-based model, including:

  • Subscription-based businesses
  • SaaS memberships
  • Community and networking memberships
  • Fitness memberships
  • Online learning platforms
  • Exclusive content and media
  • Healthcare and telemedicine

Example Application: Tech Business Alliance

Consider a Tech Business Alliance offering Individual Memberships ranging between $50 and $250. Conjoint analysis can help identify the benefits of the $250 Individual Membership that make people willing to pay more. It can also explore why these benefits are so important and why the membership starts at $50 a month rather than $39 or $19.

Starting with Conjoint Analysis

Running a Conjoint Analysis Survey

First, you need to conduct a Conjoint Analysis Survey and build Conjoint Analysis Scenarios. Present combinations of features and prices to respondents and ask them to evaluate these combinations.

Sample Conjoint Analysis Survey

Begin with optional basic questions to gather demographic data:

  • What is your age? Understanding age demographics helps tailor offerings and marketing strategies to better meet the needs of different age groups.
  • What is your gender? Gender may affect preferences for certain types of content or support options.
  • What is your annual household income? This helps design pricing structures and packages that are affordable and attractive to various income groups.

Conjoint Analysis Scenarios

Each scenario presents different combinations of features, prices, and support levels. Here are the attributes of an imaginary service:

  • Monthly Cost
  • Access to Exclusive Content
  • Number of Devices
  • Customer Support
  • Contract Length

Scenario 1

Present respondents with different options, and by selecting option 1 or 2, they help identify the most valued attributes. This feedback aids in creating a subscription service that aligns closely with customer preferences, providing the most valued features at acceptable price points.

Scenario 2, 3, and 4

We want to run three more scenarios, each with varied combinations of the attributes listed above.

We test different prices with the combination of different attributes.

Additional Questions

Include questions to gauge the importance of various features:

  • How important is the monthly cost in your decision to subscribe to a service?
    • Very Important
    • Important
    • Somewhat Important
    • Not Important
  • How important is access to exclusive content for you?
    • Very Important
    • Important
    • Somewhat Important
    • Not Important
  • How many devices would you like to use with your subscription?
    • 1
    • 2
    • 3
    • 4
    • 5 or more
  • What level of customer support do you expect from a subscription service?
    • Email Only
    • Live Chat and Email
    • 24/7 Phone and Email
    • Live Chat, Phone, and Email
  • What is your preferred contract length for a subscription service?
    • Month-to-Month
    • 6 Months
    • 1 Year
    • 2 Years or more

Benefits of Conjoint Analysis

  • The data collected helps create subscription models closely aligned with customer preferences, ensuring a better match with their needs.
  • By understanding what features are most important to customers, the service can focus on delivering high-value offerings, enhancing customer satisfaction.
  • Insights into price sensitivity and preferred contract lengths help in designing affordable and flexible pricing plans.
  • Knowing the preferred support channels and levels ensures that customer service meets expectations, leading to a better overall experience.

Tips for Effective Conjoint Analysis

  • Target the right audience that understands your product or uses competitive ones.
  • Use up to 7 attributes, preferably 5.
  • Include an option for “None.”

For further questions, feel free to reach out via email at or send a message on LinkedIn.

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