There is something about Kindle and $150 Sunglasses – Results from Conjoint Analysis

Let me start by stating that my previous article about Kindle positioning is most likely wrong and Amazon product managers have definitely done their marketing research well.  There is something about the segment that prefers $150 sunglasses and Kindle.

I will discuss only part of the results from my recently conducted conjoint analysis. I will not be providing here the detailed results, differences across gender and other analysis.

When Amazon introduced Wifi version of their Kindle (priced at $139), Mr. Bezos said,

“At $139, if you’re going to read by the pool, some people might spend more than that on a swimsuit and sunglasses,”

Amazon also ran TV Ads that talked specifically about $139 Kindle being cheaper than Sunglasses.

I did not believe that was a valid positioning, I believed (and wrote),

What job will these segments hire the e-Reader for? The same job they hire their $150 sunglasses for – to make a statement about themselves. For that job, they might be more inclined to hire an iPad than a Kindle.

I recently conducted a conjoint analysis by surveying the Haas Berkeley, MBA class of 2011 (thanks to Hrishika, MBA 2011 for providing access). I did not get enough samples from my twitter followers so I ignored all those samples.

A key finding of the study is, those who preferred $150 sunglasses also preferred Kindle more than they preferred iPad, nook or a $99 Generic eBook reader.

Among those who preferred $30 sunglasses, Kindle had 26% market share – tied for second place with generic eBook reader.

Among those who preferred $150 sunglasses, Kindle had 37% market share – the highest with a RMS of 1.34.

Better yet, my past claim that those who buy $150 sunglasses will also buy iPad is wrong. iPad had the lowest market share of 17% for this segment.

Clearly Kindle has a better chance among this segment and Amazon’s marketing campaign is capitalizing on that. That said, the Kindle Ads take on iPad on readability. It is likely that nook is the bigger competitor to Kindle for this segment than iPad.

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