Preference-rank translation is a mathematical technique used by marketers to convert stated preferences into purchase probabilities, that is, into an estimate of actual buying behaviour. It takes survey data on consumers’ preferences and converts it into actual purchase probabilities.
A survey might ask a question using a ranking scale such as :
| Please rate the following products from 1 (most preferred) to 5 (least preferred). ___ product A ___ product B ___ product C ___ product D ___ product E |
Next, the researcher uses a data reduction technique like factor analysis to obtain aggregate scores. To convert these aggregate rankings into purchase probabilities, each category (in this case, each product) will be weighted with a translation coefficient. These weights are predefined.
A typical weighting scheme is:
| first choice | = 75% | |
| second choice | = 17% | |
| third choice | = 6% | |
| fourth choice | = 2% | |
| fifth choice | = 0% |
The following chart illustrates the procedure:
| score | rank | weight | probability | ||
|---|---|---|---|---|---|
| product A | 6.4 | 2nd | .17 | 1.1 | |
| product B | 5.1 | 4th | .02 | .1 | |
| product C | 8.7 | 1st | .75 | 6.5 | |
| product D | 4.3 | 5th | 0 | 0 | |
| product E | 5.5 | 3rd | .06 | .3 |
Other purchase intention/rating translations include logit analysis and the intent scale translation.