A CBC-approach accounting to screening from both sides
(A2021-93394)

AUTHORS

Lisa Wamhoff, Universität Osnabrück; Bernhard Baumgartner, Universität Osnabrück

ABSTRACT

In the literature on consumer behaviour, a two-stage decision process in choice situations is often assumed, whereas in choice-based conjoint analysis (CBC) a linear utility function - which mirrors a compensatory decision rule - is regularly applied. Gilbride and Allenby (2004) introduced a model, wherein individuals first screen out alternatives that do not meet minimum values for every attribute, followed by a choice between the remaining ones using a compensatory rule. We extend this approach by considering not only minimum values in the screening step, but also maximum values. Using three real-world data sets of CBC, we compare this extension with the model proposed by Gilbride and Allenby, as well as the basic compensatory model. The results indicate that the two-sided screening is applied especially to prices. Both screening rules, while showing almost identical performance, improve on the linear compensatory model on fit and predictive validity.