Pricing Research is used to measure the impact of price changes on demand of a product and to determine the optimal price for new products. It helps businesses understand how price sensitive their customers are and what price points maximise both revenue and volume.
Common pricing research techniques include:
- Van Westendorp Price Sensitivity Monitor (PSM): Identifies acceptable price range by asking respondents four price-related questions
- Gabor-Granger Technique: Estimates price elasticity by presenting respondents with different prices
- Conjoint Analysis: Measures the trade-offs customers make between price and other product attributes
- Brand Price Trade-Off (BPTO): Measures how price influences brand choice
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