The Tune Scenarios node has been added to the Scientific Strategy Market Simulation tools (Community Edition).
The Tune Scenarios node generates a single tuned ‘Output WTP Matrix’ based upon observations from a number of Market Conditions.
The ‘Input Market Array’ contains the Competitive Scenarios of different Market Conditions, along with the Products, Prices, and Quantities sold within each Scenario. The different Market Conditions might include historic observations from different sales seasons. Or the different Market Conditions might include Product Sensitivity data observed when Prices of the different Products are altered. Market Conditions vary when there are different competitive Products in the Market selling at Prices that change over time. As a result, the Quantity sold of each Product will typically be different under each Competitive Scenario.
This node is designed to find three values:
- Market Mean: The reference Mean of the WTP Customer Distributions across all Products in the Market.
- Market SD: The reference Standard Deviation (SD) of the WTP Customer Distributions across all Products in the Market.
- Market Correlation: The reference Correlation between all Customer Distributions within the Output WTP Matrix.
But individual Product Mean, SD, and Correlation values can be varied by the user according to the ‘Input Product Variations’ table and the ‘Conformity Boosters’ in the Configuration Dialog.
The Competitive Strategy Game (CSG) by Professor Severin Borenstein (Haas School of Business at UC Berkeley) simulates eight Competitors competing in four different Markets. Cracking the CSG (Part 01) involves calculating the Customer Willingness To Pay (WTP) Matrix for each Product using the public information provided at the beginning of the game.
The Tune Scenarios node generates a single Customer Willingness To Pay (WTP) Matrix tuned to multiple Competitive Scenarios with Products competing under different Market Conditions.
The Tune Market node is designed to take raw Customer Distributions for Products found in the Market and quickly tune them to create a Willingness To Pay (WTP) Matrix. The WTP Matrix quantifies the maximum Price that each Customer would pay for each Product in the Market.