Price Sensitivity Studies

Price sensitivity studies analyze how customers’ demand for a product changes in response to different price levels. They help businesses understand the maximum price customers are willing to pay and identify the optimal price point that balances profitability with customer demand. By testing various prices, companies can gauge how sensitive their customers are to price changes, guiding pricing strategies to maximize revenue without losing too many buyers. Essentially, these studies reveal the relationship between price and customer behavior, enabling more informed, data-driven decisions on product pricing.