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Using WTP Calculation when having 3 features instead of 2

I would like to use this procedure before doing my simulation, just to get a first impression about the data. In comparison with your example I have 3 levels of price and 3 levels of the other feature. Is it possible to use this proceeding for my WTP, too?
related to an answer for: Willingness-to-Pay Calculation
asked Sep 14, 2015 by anonymous
edited Sep 14, 2015

1 Answer

0 votes
Don't know what you are referring to by "this procedure".  If you are referring to the algebraic formula of computing WTP, then you'll need to somehow convert the 3 levels of price into a single price coefficient.  This can be done using a linear price term, though it assumes a single slope for a coefficient that could have a kink.  Or (discarding some information) you could just pay attention to the two extreme levels and assume a linear function between them.

If you are referring to estimating WTP using the method of market simulation: setting a test product at a given price against a field of competitors, then enhancing the test product and changing its price until the new share of preference matches the old share of preference...then it doesn't matter how many levels of price you have because the software and the mathematical approach can handle interpolation between levels.
answered Sep 14, 2015 by Bryan Orme Platinum Sawtooth Software, Inc. (198,815 points)