SkeletonSlide8_2010Fall_MGMT324

SkeletonSlide8_2010Fall_MGMT324 - MGMT 324 Marketing...

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MGMT 324 Marketing Management Sangwoo Shin Fall 2010 Sep 27, 2010
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Linear MA Model Recap Utility Product = W 1 Attr 1 + W 2 Attr 2 +…+ W m Attr m m: Number of relevant attributes Why useful? Explains why consumers buy what they do in a very simple manner Attr j for j=1,. .,m: Amount of j th attribute inherent in product W j for j=1,. .,m: Relative importance weight of j th attribute Does a good job of predicting choices Identifies what attributes consumers want Æ Product/Promotion insights Æ Segmentation/Targeting implications
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Graphical View of Linear MA Models Utility Product = W 1 Attr 1 + W 2 Attr 2 w 1 Utility Attr 1 Attr 2 Attr 1 Utility = U 0 slope = – w 1 / w 2 B C A For simplicity, there are only two relevant attributes Utility = U 1 Utility = U 2 Utility = U 3 Indifference curves Where U 0 < U 1 < U 2 < U 3
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Perception is Vital Consumer attributes Engineering Attributes Example 1: How Boston residents see the US Attr j for j=1,. .,m in the MA model = Consumer’s subjective perception of j th attribute level
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SkeletonSlide8_2010Fall_MGMT324 - MGMT 324 Marketing...

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