Market research is frequently concerned about finding out which aspects of a product or service are most important to companies. The ideal product or service, of course, would have all the best characteristics, but realistically, trade-offs have to be made. The product with the most expensive features, for example, cannot have the lowest price.
Conjoint analysis is a technique for measuring respondent preferences about the attributes of a product or service. It is the ideal tool for new/improved product development. The conjoint analysis task asks the respondents to make choices in the same fashion as consumers normally do, by trading off features one against the other, either by ranking or choosing one of several product combinations. e.g. a task could be: do you prefer a "flight that is cramped, costs £250 and has one stop" or a "flight that is spacious, costs £500 and is direct"?
Using conjoint analysis, you can determine both the relative importance of each attribute (e.g. spaciousness, price, number of stops) as well as which levels of each attribute are most preferred (e.g. how much is a price of £250 more preferred than a price of £500).
Example: Importance Of Printer Features, Plus Simulator
Conjoint analysis is typically used to guide new product developers by indicating which product aspects are most important to different companies. It is also useful to gauge market reaction when a product (attribute) will change e.g. what will happen to the market share of brand A if its price increases by 10%?