Functional foods is one of the fastest growing food categories due to the increasing interest to maintain health through proper feeding habits. Understanding the factors that affect consumer choices of food that contain functional ingredients is key to their market success. This paper applies Multicriteria Decision Methods (MCDM) to aid in the decision process in the concept development stage of product development. Analytical Hierarchy Process (AHP) is applied to establish priorities among different concepts, and Choice Based Conjoint Analysis (CBC) is used to optimize specific product attributes that a food concept with added functional ingredient should have. Consumer surveys were conducted in Caracas, Venezuela in 2008 - 2009. Five food categories and six functional benefits were combined for a total of 30 concepts and ranked by a team of experts based on a set of relevant criteria. A yoghurt that helps the digestive process was ranked first in preference. Having selected this concept, a set of five product attributes each at three levels for a total of 36 miniconcepts were evaluated with Choice Based Conjoint Analysis (CBC) via a randomized design in a Web based survey applied to a sample of 250 regular user of yoghurt. The product containing pieces of fruit, firm texture, which regulates intestinal function, low fat, with sweetener (Splenda) and intermediate price achieved the highest utility value. The model allows for market simulation to determine share of preference of the different concepts.