Launching new products can be easy for brands, but it is not as easy to decide how to prune an existing product portfolio. Consider this case study in the hospitality market, where a fast food brand wants to optimize its profitability by changing its menus. Philippe, a young product manager is determined to delist the brand’s famous Curly Fries and introduce the cheaper Easy Fries instead. However, his colleague, David, has a feeling this may be the wrong move. Sander and Carlo showed how MBC can provide them with the evidence they need to make the right move on the market. Menu-based Choice modeling (MBC) is an innovative conjoint-based method specifically designed for markets where the purchase choice is based on a menu. Think of a fast-food restaurant where consumers can create their meal by combining single items - burger and a soft drink - or buy a pre-configured menu. Or think of the telecom or financial services industries where providers want to optimize prices of various bundles and value-added services. For more presentations from SKIMspiration London, visit www.skimspiration.com/downloads.

1. expect great answers
The Curse of the Curly Fries!
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Carlo Borghi & Sander Noorman #SKIMspiration

2. Menu Based Choice
(MBC)

3. MBC - TV options
1
Basic Comfort Comfort ++
Digitale TV & Record &
Digital TV - €25 Digital TV & Record - €32.50 Tablet - €37.50
2 3
Extra options: Extra channels
HD TV - €4 95 Extra channels - €5
Extra media box - €4 Movie Package - €8 Your total price €32,50
Led light media box - €1 Sport package €17

4. MBC - TV options
1
Basic Comfort Comfort ++
Digitale TV & Record &
Digital TV - €25 Digital TV & Record - €32.50 Tablet - €37.50
2 3
Extra options: Extra channels
HD TV - €4 95 Extra channels - €5
Extra media box - €4 Movie Package - €8 Your total price €53,50
Led light media box - €1 Sport package €17

5. The Curse of the Curly Fries

6. David
Senior Product manager

7. ...back in the 80s…

8. ...back in the 80s…

9. ...back in the 80s…

10. ...back in the 80s…

11. ...and today…
11

12. Philip
Junior Product manager

13. Easy Fries
Healthy, Young and Cheap

14. David or Philip?

15. The solution
Jennifer
Market Researcher at MIKS
15

16. The question
or
16

17. The method
MBC
Menu Based Conjoint
17

18. Make your choice
1$ 3$ 1$ 1.5$

19. Make your choice
1$ 3$ 1$ 1.5$

20. Make your choice
1$ 3$ 1$ 1.5$

21. Make your choice
1$ 3$ 1$ 1.5$ 1.5$

22. Make your choice
1$ 3$ 1$ 1.5$ 1.5$

23. Make your choice
1$ 3$ 1$ 1.5$ 1.5$

24. Make your choice
1$ 3$ 1.5$ 1.5$

25. Insight #1
# People choose Tender Grill with Curly Fries.

26. Insight #1
# If Donald King delists Curly Fries….

27. Insight #1
# …people will buy less Tender grill

28. Insight #2
# Curly Fries Lovers …

29. Insight #2
# …if Donald King delists Curly Fries

30. Insight #2
# …they don’t come to Donald King anymore

31. So what?

32. So what?
# Keep Curly Fries at higher price

33. Can we still include Easy Fries?

34. Insight #3
# New segment, the “Green” families

35. Insight #4
# No cannibalization effects

36. Insight #4
# Two different segments

37. So what?
or
37

38. So what?
or
38

39. So what?
and
39

40. So what?

41. So what?

42. So what?

43. MBC in various industries
43

44. MBC - Car options

45. MBC - Car options
Driver comfort Sport package Metallic paint € 450
Comfort Seat € 90 € 440 € 760
Heated mirrors € 150
Parking sensors € 195 Base price: €10,000
Alloy Wheels € 350
Rain sensor € 265
Air conditioning € 90 GPS navigator €150
Audio system € 75 Total price €11,355
Cabin Comfort Plus Navigation Pack
Heating seats € 165 € 265 € 375 GPS alarm € 320

46. MBC - Car options - So what?
Price Sensitivity Simulation
Driver comfort Driver comfort € 500
% 18.5%
Comfort Seat € 90
7.2%
Parking sensors € 195
11.3%
Rain sensor € 265
€400 €450 €500 9.9%
Price

47. MBC: where else?

48. contact us or follow us online!
Carlo Borghi | Project Manager Sander Noorman | Director Telecom, Services & Technology
c.borghi@skimgroup.com s.noorman@skimgroup.com
+44 203 586 7241 +31 10 282 3535
Share your thoughts online:
#SKIMspiration