Overview
Menu-Based Choice (MBC) is advanced discrete choice modeling software for multi-check menu studies. Many products and services allow buyers to choose among a variety of options in configuring their preferred product. Examples include restaurant menus, financial services, insurance options, automobile purchases, and choice of telephony/internet/cable options. Menu-Based Choice studies are useful for studying mixed bundling, where buyers can select pre-designed bundles of items and also items a la carte. Includes logit and HB modules, plus simulations (including Excel simulation option).
Increasingly, stated preference choice projects involve Menu-Based Choice scenarios (MBC) where respondents can select one to multiple options from a menu. This is not surprising, given the fact that buyers commonly are allowed to customize products and services (mass customization). Examples include:
- choosing options to put on an automobile
- selections from a restaurant menu
- banking options
- configuring an insurance policy
- purchasing bundled vs. a la carte services including mobile phones, internet, and cable.
The software takes a data processing and analysis process that can take experienced analysts from one to two weeks to do and compresses the timeline to 1 to 2 days.
MBC requires more expertise to use properly than our other conjoint analysis tools. The user should have solid background in CBC and multivariate statistical modeling, especially in terms of building models (regression, MNL) and the theory behind coding independent variables. While the software manages most details involving the data processing, independent variable coding, model estimation and simulations, the user must understand and direct the process intelligently.
Sawtooth Software's new Menu Based Choice (MBC) software has unlocked a field of conjoint that was only previously available to elite conjoint users. What would have taken the analyst days (probably weeks in some cases) to set up the analysis and simulations can now be accomplished in a matter of hours and the flexibility that the software offers regarding specifying different cross-effect models means that MBC can now become a mainstream conjoint technique.
I was particularly impressed with the way Sawtooth Software has designed the software to allow for the multitude of ways that accompany MBC projects and I look forward to using it in the future.
Chris Moore, GfK NOP, UK
With the successful completion of several large-scale projects, Menu-Based Choice has proven to be a highly useful addition to our portfolio of choice modeling approaches. It provides an approach perfectly suited to research problems involving multi-step purchase decisions. The results have been well-received by our clients, two of whom have commissioned a second study based on the results they have seen.
Karen Buros, Radius Global Market Research
Methodology
What is MBC (Menu-Based Choice)?
Over the past decade, there has been increasing interest in designing and analyzing menu-based choice questionnaires, as they often more realistically reflect real-world buying situations than standard Choice-Based Conjoint (CBC) or ratings-based conjoint. Examples in the literature include articles by Liechty et al. (2001), and Cohen and Liechty (2007).
The main difference between MBC and other discrete choice methods from Sawtooth Software (MaxDiff and CBC) is that MBC can handle a variety of menu choice situations in which respondents make from one to multiple choices in the process of building their preferred selection.
In conjoint analysis, we consider multiple factors (attributes), where each attribute has at least two levels. Menu-based choice problems also involve multiple factors, each having multiple levels. Whereas we often think of a CBC question as being composed of multiple product concepts (cards), we should think of the entire MBC menu question being represented by a single card. This allows researchers to use the familiar tools for conjoint design with MBC experiments (CBC or CVA Software, Warren Kuhfeld's SAS routines), except that the number of factors for MBC experiments will often be much larger than for traditional conjoint or CBC.
Questionnaire development and data collection may be done with any questionnaire instrument (even paper-and-pencil) or web survey tool of your choice, including Sawtooth Software's Lighthouse Studio program. We generally recommend using randomized design strategies, as they are robust and convenient to use for MBC studies. If you use Lighthouse Studio, you will need to customize the questions using Free Format and typically some customized Javascript code that you must write on your own.
Analysis includes commonly known tools of Counting, logit, and HB analysis. The statistical routines used in MBC are the same as used in CBC. However, the model specification and sheer number of inter-related models is more complex and greater in MBC. MBC software manages a complicated process with elegance and simplicity. During the model specification process, the researcher can preview the design matrix, so the process is transparent and never becomes "black-box." Own-effects, cross-effects, availability effects, conditional dependencies, linear, log-linear, and part-worth terms are supported. Despite the flexibility, MBC automatically handles so many of the coding aspects that can occupy so much time if attempted manually.
The final deliverable of an MBC project is usually the market simulator. MBC software provides a simulator that can project what percent of the respondents are likely to pick each item from a menu, given a set of menu prices. If using HB estimation of the parameters, MBC can also simulate expected combinations of items that respondents are most likely to pick.
The most stringent test of how well MBC performs hinges on the ability to predict individual-level combinatorial choices of items. Across multiple studies, MBC software has proven adept at predicting individual combinatorial choices. In our most stringent test, MBC combinatorial predictions approached (92% of) the level of test-retest reliability. This means that the MBC simulator was able to predict respondents' exact choices on a menu 92% as successfully as when respondents were asked to repeat the same menu task at a later point in the survey.
Pricing
There are three ways to license MBC software. You will need to purchase a Premium or Premium Plus Suite Subscription, a MBC Component Subscription, or an Academic Research Subscription. Click one of the graphics below to go to our Pricing and Ordering page for more information or to request a quote.
