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Combining two attributes in alternative-specific design

Hi all,

I am putting together a model for a financial institution, and one of the key things they would like to test is whether giving people a set of fees independently is more/less preferred to giving them one overall fee.

I am thinking I can do this as an alternative specific design - if fee presentation = all in one I just show them a set of all-in-one fees, but if fee presentation = separate fees I show the fees split out separately. Some fees are flat fees and others are a % of the purchase (purchase amount will be fixed).

The problem though is that I want to be able to see which option they prefer when the total amount is the same - i.e. do they prefer a $10 fee plus .05%, or a total fee of $13? To do this, I think I would need to use a function to sum up the value of the levels in fees and costs, so that later when I analyse the data I can look at presentation style independently of total fees. If I don't do this, all it will tell me for all-in-one fees is which total fees are preferred - I already know that, lower total fees are better - and I'll only be able to look at the interaction of fees and costs when the fee presentation is split out. Which all seems like it gives me no more information (and possibly less) than simply always showing the fees split out.

Is there any way to do this? I want to be able to sometimes show the fees all added together as one figure, and sometimes as separate fees, with a controlling variable that tells me which type they preferred so I can see how presentation impacts on choices, but also look at which fee types people pay more attention to when they are split out.

Any help most appreciated!

Any help would be much appreciated.
asked Apr 1, 2021 by Sharon Morris (385 points)

1 Answer

+1 vote
I believe your idea of alt-spec design works well.  During the analysis phase, you can use the market simulator to specify a choice scenario where the total fees are the same, but one alternative has them broken out and one alternative has them summed.  The simulator will use the utility scores to predict what each person would do when the fees are equalized, but presented in a different format.  I believe this would answer your question.
answered Apr 1, 2021 by Bryan Orme Platinum Sawtooth Software, Inc. (195,390 points)
Thanks Bryan - a speedy and helpful answer as always. :)