The word SIMALTO is an acronym for Simultaneous Multi-Attribute Level Trade-Off. The tool presents people with a number of different attributes that they may value in a product or service, asking them to trade them off to determine what they would like to see improved.
Making sense of product improvement
The SIMALTO tool was invented by John Green, a market researcher who had worked in business to business markets, including for Rank Xerox, and so the technique is appropriate for business to business respondents.
Respondents are presented with a grid of different attributes which improve from left to right. They are asked to indicate what level of product or service they receive at the present, what level they would like to receive, and then they are given a number of points to spend across different improvements to show how they are valued (the numbers in the bottom right of each square in the grid).
The SIMALTO tool has the advantage of presenting product improvements in words that respondents can readily relate to.
A small number of interviews – even just a handful – can be analyzed and this can be important in niche business to business markets. The results are very practical in showing what people are receiving at present, what they would like to receive, and how much they would spend to achieve the desired level.
Our client wanted to see how improvements can be made in a commodity market where the products and the service had changed very little over the last 50 years.
What we did
We decided that SIMALTO was the most appropriate pricing tool for meeting the client’s requirements.
Using SIMALTO, it was possible to identify which parts of the “offer” should be improved and how much each of these improvements was valued.