MKF2131 – Marketing Decision Analysis Case Assignment – Session 1/2021
© 2021 David Sugianto Lie Page 1 of 2
MKF2131 – Marketing Decision Analysis
Mini Case Assignment 2
Session 1/2021

Problem Background
Homer and Co. is the leading manufacturer of roofing shingles in the town of Springfield, which
provides roofing solutions to home builders and contractors. The company has been the market
leader of roofing material since its inception in the town. However, due to increasing competition,
the foreign market has entered Springfield with some competitors providing similar quality with a
much cheaper price. At the same time, the cost of raw materials has been increasing as Mayor
Quimby has forced to produce the roof locally. The COVID-19 outbreak has also sparked in
Springfield which again overcomplicates the situation.

Homer and Co. has decided to: (1) develop a new product, and (2) engage in your service to
understand its brand and how to maintain sustainable competitor advantage. Specifically, the
company wants to understand the following:
• What is the relative importance of brand, offering and relationship attributes in the company’s
desired new products?
• Identify the customer’s willingness to pay for each attribute.

Analysis
You have conducted a conjoint study in Springfield to identify the trade-off among different
attributes and best presented for the needs of the consumers. Homer and Co. was particularly
interested in the following attributes: (1) life expectancy, (2) speed of installation, (3) shingle
aesthetics, and (4) price. These attributes were identified by the market research firm company to
be the key drivers of consumers’ purchase and each of these attributes can take different levels
listed below.

Life Expectancy
(3 levels)
Speed of Installation
(3 levels)
Price
(3 levels)
Shingle Aesthetics
(2 levels)
Low Resistance* 1 week* $8* No imperfections*
Medium Resistance 1.2 weeks $9 Minimal imperfections
High Resistance 1.5 weeks $10
* represents the default category.

From the above levels, 9 combinations/bundles were selected by you as potential for a new product.
These combinations are listed in the dataset. Respondents were asked to give a rating of each
bundle from 0 (least preferred) to 100 (most preferred). That means each respondent must rate all
the 9 bundles. These bundles are provided in the dataset.

The data has been collected by the market research company. Your tasks in the mini-case project
are: (1) analyse the result through regression, (2) identify the most important attributes through
part-worth utilities, and (3) predict the accuracy of the model with the part-worth utilities. For the
purpose of the mini case, only the first 20 respondents are shown, with their ratings for all 9
bundles/combinations. Information on these bundles and responses are recorded in the dataset.
Furthermore, these respondents are divided into three different segments, which are outlined in the
dataset.

MKF2131 – Marketing Decision Analysis Case Assignment – Session 1/2021
© 2021 David Sugianto Lie Page 2 of 2
Questions
These questions are designed to guide you with the report.

1. Calculate the part-worth of all roofing shingle attribute-levels.


2. Calculate the relative importances of the attributes and provide insights on the attribute
preferences of the three segments.
(Hint: Once you have calculated the attribute importances for all respondents, take the average
of attribute importances of respondents that belong in those segments).


3. In Springfield, these four roof shingles are identified as your main competitors. The
profiles/bundles of the roof are as follows:

Skinner the Great: Life Expectancy: Low Resistance, Speed of Installation: 1.5 weeks, Shingle
Aesthetics: No Imperfection, Price: $9.

Krusty Unbreakable: Life Expectancy: Medium Resistance, Speed of Installation: 1.2 weeks,
Shingle Aesthetics: Minimal Imperfection, Price: $8.

Moe’s the Best: Life Expectancy: High Resistance, Speed of Installation: 1 week, Shingle
Aesthetics: No Imperfection, Price: $10.

Flanders the Neighbor: Life Expectancy: Low Resistance, Speed of Installation: 1.5 weeks,
Shingle Aesthetics: Minimal Imperfection, Price: $8.

Calculate the purchase probability for each bundle against these four competitors, using Logit
model.
(Note: You will need to transform the above into dummy coding, calculate the utilities for all
above roof shingles for each respondent, and then use the logit formula).


4. Based on the calculation in Question 3, recommend Homer and Co. the best product to launch
(i.e., from Bundle 1 to Bundle 9). In your report, you should also suggest the best combination
that consumers want in different segments.


5. In order to verify as to whether the conjoint model is reliable, each respondent has to select
which competitors’ roof shingles (i.e., four products that mentioned in Question 3) they prefer.
The respondents’ choice is recorded in the spreadsheet. Comment on the accuracy of the model
to predict respondents’ choice.
(Note: You will need to use the table “Competitors: Utilities” and compare the results with the
respondents’ selection. Ideally, a rational consumer always selects a product that yields the
highest utility.)


END OF PROJECT BRIEF

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