American Express v. Visa and MasterCard (and related litigations)
In an antitrust matter involving payment cards, Analysis Group supported Professor John Hauser in validating and replicating consumer surveys (discrete choice studies) undertaken by the plaintiff and industry analysts to understand customer preferences for payment cards. These surveys, which measure consumer choice at the feature level, can be used to model consumer demand for alternative choices that did not exist in the actual world to inform the "but-for" world.
Using industry standard software to perform conjoint analysis, we measured interactions among numerous attributes (e.g., reward structure, airline miles) to extract relative values (or partial utilities) for each respondent, i.e., which features contribute to a cardholder's choice of payment product. Using choice-based conjoint and hierarchical Bayesian analysis, we were able to simulate each respondent's preferences and calculate specific utilities for each attribute. We then ran these utilities through a model, enabling us to predict choice in a simulated marketplace.
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