Virtual Reality-Based Product Representations in Conjoint Analysis

Abstract

Innovations are an important factor for companies to build and sustain a competitive advantage. Even though companies generate up to 51 % of their income with products and services launched less than three years ago, the failure rate of new product development is still at around 90 %. One way to reduce the failure rate of innovations is to conduct customers’ preference measurements in the early stages of new product development processes. However, customers often display a substantial amount of uncertainty when having to evaluate highly innovative products as they may not be able to grasp its features and functionalities. Therefore, some empirical studies have already compared different presentation forms in a conjoint setting. These studies aim to optimize preference measurement results by exposing respondents to state-of-the-art product descriptions in the new product development process. Based on a quantitative-empirical analysis, this thesis contributes to this research vein by integrating virtual reality-based (VR) product representations within a conjoint setting for the measurement of preferences in the development process of a technically complex innovation. The results of this study point out that VR offers the potential for early customer integration within the new product development process.