Westendorp Priceing Model
The Van Westendorp Pricing Model is used to determine the price range for a product or service. The model is based on the idea that there are four key price points that are important to consumers:
The point at which the product is considered too cheap
At what price would this be so cheap that you would question its quality?"
The point at which the product is considered a bargain
At what price would you consider the product to be a bargain - a great buy for the money?
The point at which the product is considered to be getting expensive
At what price would you consider the producet to be getting expensive, but you would still consider buying it?
The point at which the product is considered too expensive
At what price would you consider the product to be too expensive to consider and would prohibit you from buying it?
After collecting this data, the model uses the responses to determine the price range that is most likely to maximize revenue. The model is based on the idea that there is a range of prices that will maximize revenue, and that this range can be determined by analyzing the responses to these four questions.
Plotting the responses to these four questions on a graph can help to visualize the price range that is most likely to maximize revenue. The model can also be used to determine the optimal price point for a product or service, based on the responses to these four questions.
