There are many different approaches to estimating price utilities, but which one is best when you have many (30+) SKUs? Previous papers have focused on studies with 16 or less SKUs. This paper will review a conjoint exercise with 36 SKUs to understand if using price tiers (grouping similar price points together) can simplify the analysis and potentially provide similar stability of elasticity estimates compared to using SKU-level alternative-specific price attributes to capture the full range of price responses. Will using a tiered approach avoid extreme elasticity estimates?
