Pricing study with a choice-based conjoint for a subscription product

Pantry & Pan delivers recipe boxes across Great Britain. It has 41,000 active subscribers on a plan of 3 recipes for 2 people a week at £4.20 per serving, about £25.20 a box, with delivery included. Ingredient and delivery costs have risen by about 14% in two years, and gross margin has fallen from 38% to 29%. The board wants margin back above 34%.

The commercial director does not want to simply raise prices, because monthly churn is already 9% and two competitors are discounting heavily. She wants to know what customers actually value and what they will pay for: more recipe choice, faster delivery slots, recyclable packaging, or a cheaper plan with fewer options.

You are the pricing analyst. In eight weeks you will: - frame the pricing problem and the hypotheses to test; - design a choice-based conjoint survey with attributes such as price per serving, recipe choice, delivery window, packaging and a pause option, plus a Van Westendorp price sensitivity block; - simulate 600 responses from a stated utility model, so you can check that your analysis recovers the values you put in, and treat the result as your survey data; - estimate part-worth utilities with a multinomial logit model; - build a market simulator with two competitor offers and find the revenue- and margin-maximising price and plan; - recommend a price and plan structure, with a live A/B test plan to confirm it.

Done means a recommendation that names the price per serving and plan features, the expected effect on take-up and margin, the risk to churn, and a test that would confirm or reject it within six weeks.