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Contents 1 Price Setting Surveys and Elasticity of Demand Analysis 1.1 Uses 1.2 Product Loyalty 1.3 Alternative Products 1.4 Price Setting and Elasticity of Demand Analysis 1.5 Impact of Incentives 1.6 Associations, Tie-ins and Bundling 1.7 Intention 1.8 Conjoint analysis for price setting

[edit] Price Setting Surveys and Elasticity of Demand Analysis

Pricing surveys that estimate the elasticity of demand are directed at showing optimal price points, perceptions of prices that are too low and too high. Pricing surveys are often designed to show the demand for the product or service for different segments of the market, but may also include different usage situations.

Segmentation Variables
Demographic
Cultural trends (that might support/conflict with our product or service; intentions to repurchase, etc.)
Ability to purchase

[edit] Uses

Current usage situations
Identify new uses
Measure peer influence/strength of recent trends

[edit] Product Loyalty

Awareness of product and attributes, benefits, quality
Repurchase and purchase Rates (within segments)
Economic motivations for purchase

[edit] Alternative Products

Pricing relative to competitive products
Availability of near substitute products
Possibility of upstream or downstream integration (introduction of product)

[edit] Price Setting and Elasticity of Demand Analysis

Van Westendorp

1. The price at which the product is so cheap that the respondent would question its quality;
2. the price at which the product is inexpensive, but no so inexpensive that the respondent would question its quality;
3. the price at which the product is expensive, but not so expensive that the respondent would not consider it; and
4. the price at which the product is so expensive that the respondent would not consider it.

[edit] Impact of Incentives

Impact of incentives to defray costs (in actuality or psychologically) – coupons, cents off, tie-ins, contests, promotions

[edit] Associations, Tie-ins and Bundling

Bundling ability to increase revenue?

[edit] Intention

Intention to purchase within measurable time frame
Intention to increase purchases

[edit] Conjoint analysis for price setting

Conjoint analysis can be used to test combinations of price with product attribute bundles