Constructing MDS Joint Spaces from Binary Choice Data: A Multidimensional Unfolding Threshold Model for Marketing Research

Abstract

The authors present a new multidimensional unfolding methodology that can analyze various types of individual choice data. The model represents choice data, defined by dichotomous variables that indicate whether a particular brand was chosen or not, in terms of a joint space of consumers and brands. Explicit treatment of marketing and subject background variables is allowed through optional model reparameterizations of consumers and brands. Together with the joint space representation of both consumers and brands, these optional reparameterizations can provide information on appropriate market segmentation bases and respective product positioning strategies. The authors apply this spatial choice model to data on consumer (intended) choices for 12 residential communications devices and demonstrate how the results can be used for optimal positioning decisions.