Using Uncorrelated Conjoint Choice Designs in a World of Correlated Beliefs
In the real world of consumers’ experience, brand names are often correlated with perceived product quality, as well as prices. Not surprisingly, consumers act upon these beliefs in their daily purchase decisions by using brand names to "chunk" information. In conjoint analysis, however, consumers are typically presented with an orthogonal world, where attributes such as brand, quality and price may be uncorrelated. There is concern that the simplifying strategies that are appropriate in a correlated world are eventually adapted after exposure to an orthogonal one, such as that experienced in conjoint analysis tasks. However evidence is mixed concerning failure of orthogonal conjoint designs to predict choices when attributes are correlated.
