Date Posted: 05/20/2021

Willingness to Pay (WTP) for Conjoint Analysis

Conjoint analysis captures how buyers trade off features and prices, so estimating Willingness to Pay (WTP) seems like a natural byproduct of the analysis. However, traditional methods for estimating WTP tend to overstate it and are unrealistic because they don't consider relevant competition or that the buyer can walk away (choose the "None alternative"). We describe a better way to estimate WTP using Sawtooth Software's WTP feature in our market simulator.