Price Sensitivity Meter

  1. At what price would you consider the product to be so expensive that you would not consider buying it? (Too expensive)
  2. At what price would you consider the product to be priced so low that you would feel the quality couldn’t be very good? (Too cheap)
  3. At what price would you consider the product starting to get expensive, so that it is not out of the question, but you would have to give some thought to buying it? (Expensive/High Side)
  4. At what price would you consider the product to be a bargain — a great buy for the money? (Cheap/Good Value)
  1. IPP — indifference price point — the intersection point of the “not expensive” and “not cheap” curves. This is the average price that buyers consider acceptable for a given product or service.
  2. PME — point of marginal expensiveness — the intersection point of the “not expensive” and “too expensive” curves. Buyers consider this price high, which often leads to rejection of the purchase.
  3. PMC — point of marginal cheapness — the intersection point of the “too cheap” and “not cheap” curves. A low price may cause the buyer to doubt the quality of the product and this will lead to an increase in rejections from purchases.
  4. OPP — optimum price point — the intersection point of the “too cheap” and “too expensive” curves. The author of the method considers this price to be optimal since the number of potential buyers is extremely large.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Alexey Cherkasov

Alexey Cherkasov

Marketing and sales professional with over 10years experience in b2b industry of power electronics and power semiconductors.