Incorporating Subjective Characteristics in Product Design and Evaluations

Journal of Marketing Research, Vol. 45, No. 2, pp. 182-194, April 2008

Marshall School of Business Working Paper No. MKT 22-10

14 Pages Posted: 7 May 2007 Last revised: 23 Nov 2010

See all articles by Lan Luo

Lan Luo

University of Southern California

P.K. Kannan

University of Maryland - Robert H. Smith School of Business

Brian T. Ratchford

University of Texas at Dallas

Abstract

Consumers often use objective as well as subjective criteria to evaluate a product. For example, power tool users may evaluate a power tool based on not only its objective attributes such as price and switch type but also its subjective characteristics such as ease of use and the feel of the tool. Our research is distinctive in its emphasis on incorporating subjective characteristics in new product design. We propose a model in which consumer's purchase intention can be impacted by both the objective attributes and the subjective characteristics. This model has the form of a hierarchical Bayesian structural equation model with the subjective characteristics treated as latent constructs. We also propose a Bayesian forecasting procedure in which the estimated relationships are used to improve the out-of-sample prediction. We illustrate our approach in two empirical studies. Our results indicate that, by collecting additional information about consumer's perceptions of the subjective characteristics, our model can provide the product designer with a better understanding and a more accurate prediction of consumer's product preference than the traditional conjoint models.

Keywords: new product design, Bayesian forecasting

Suggested Citation

Luo, Lan and Kannan, Pallassana and Ratchford, Brian T., Incorporating Subjective Characteristics in Product Design and Evaluations. Journal of Marketing Research, Vol. 45, No. 2, pp. 182-194, April 2008, Marshall School of Business Working Paper No. MKT 22-10, Available at SSRN: https://ssrn.com/abstract=984493

Lan Luo (Contact Author)

University of Southern California ( email )

Hoffman Hall 319
Los Angeles, CA 90089-1427
United States

Pallassana Kannan

University of Maryland - Robert H. Smith School of Business ( email )

Department of Marketing
College Park, MD 20742-1815
United States
301-405-2188 (Phone)
301-405-0146 (Fax)

Brian T. Ratchford

University of Texas at Dallas ( email )

2601 North Floyd Road
Richardson, TX 75083
United States

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