Time to rethink #pricing?
Here’s a research methodology you should know.
It’s called the Van Westendorp Price Sensitivity Meter.
Back in March, Rowan Noronha and I hosted an episode of the Marchitect podcast that was all about pricing.
Two pricing experts, Mark Stiving, Ph.D. and Kyle Poyar shared their best practices, how to approach pricing research, and what NOT to do when setting your price.
It’s still one of the shows most popular episodes to date.
Make sure you check it out → https://bit.ly/3G6t4R3
During the episode, Kyle talked about the Van Westendorp Price Sensitivity Meter as one of his favorite methods for getting pricing feedback from customers and prospects.
Tamara Grominsky also talks a lot about this approach in our Ready For Launch course.
How does it work?
Instead of simply asking customers what they would be willing to pay for your product (let’s be honest we’ve all done this), it asks them a series of four questions to determine an acceptable price range.
Here are the four questions:
1️⃣ At what price would you consider this product to be a great deal?
2️⃣ At what price would you consider the product so cheap that you would feel the quality couldn’t be very good?
3️⃣ At what price would you consider the product starting to get expensive, not enough to rule it out, but you would have to justify buying it?
4️⃣ At what price would you consider the product to be so expensive that you would not consider buying it?
You then plot your survey results on a line graph to find your Optimum Price Point.
That’s where it gets tricky. The graph isn’t the easiest thing to create or interpret. So I created a simple template with a handy walk-through video to help you do it.
Grab the template here → https://bit.ly/3K3XzXJ