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Price Sensitivity Analysis

This tool is designed by Peter van Westendorp to understand how much cost the target audience would be willing to bear for your solution.
Price Sensitivity Analysis

How It Works?

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Step 1

Conduct a Perception Survey

Introduce your solution to at least twenty, preferably close to a hundred individuals from your target audience and conduct a survey comprising the following four questions:

  • At what price level would you consider the solution too expensive to purchase (Very expensive level)?
  • At which price level would you perceive the solution's quality to be compromised (Very cheap level)?
  • At what price level would you find the solution to be somewhat expensive but still worth considering for purchase?
  • At which price level would you perceive the solution as offering great value for money (Level seen as good value)?

Each respondent should provide a single price for each question.
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