Van Westendorp Method

A widely used method for researching price sensitivity and perception to determine the optimal price users are willing to pay for a product or service.


The Van Westendorp Method is a market research technique used to determine the optimal pricing range for a product or service. By asking respondents about their perceptions of pricing thresholds, it identifies the price points at which a product is perceived as too cheap, affordable, expensive, or too expensive. The Van Westendorp Method is valuable in pricing strategy, product launch, and competitive analysis, where understanding consumer price perceptions guides pricing decisions and market positioning.

Suitable for

  • determining the optimal price that users are willing to pay
  • setting the initial price for further testing in practice
  • research with multiple people


Price Sensitivity Meter Survey

A questionnaire designed to measure customers' price perceptions, including the range of acceptable prices for a product or service and the optimal price point within that range. It will include the four Van Westendorp pricing questions focused on 'too cheap', 'bargain', 'expensive', and 'too expensive' responses.

Survey Responses Data

A collection of raw survey responses from the target audience, containing their answers to the four Van Westendorp pricing questions, along with any demographic and segmentation data as needed.

Data Analysis Summary

A document providing insights and interpretations of the survey responses, including the identification of critical price points (Point of Marginal Cheapness, Point of Marginal Expensiveness, and Optimal Price), assessment of price elasticity, and any potential price gaps or opportunities discovered.

Price Perception Map

A visual representation of the customers' price perceptions, illustrating the range of acceptable prices in comparison to the competing products or services. The graph will display the intersections of cumulative percentages for each of the four Van Westendorp pricing questions - too cheap, bargain, expensive, and too expensive.

Recommendations and Pricing Strategy

A comprehensive report outlining the suggested pricing approach, considering the findings from the survey and data analysis, along with the organization's objectives, cost structure, and competitive landscape. It will provide actionable steps for optimizing pricing and maximizing profitability, customer satisfaction, and market share.



Introduction to the Van Westendorp Method

The Van Westendorp Method, also known as the Price Sensitivity Meter, is a survey technique used to evaluate the optimal price range for products or services. It gathers participants' responses to four key questions that help determine customer acceptance of different price points.


Formulate the pricing questions

Create four essential questions for the survey. These are: 1) At what price would you consider the product/service to be so inexpensive that you doubt its quality? (Too Cheap); 2) At what price would you consider the product/service to be a good value for the money? (Bargain Price); 3) At what price would you consider the product/service to be too expensive to consider purchasing? (Too Expensive); 4) At what price would you consider the product/service to be so expensive that it is not worth considering? (Too High).


Select the target audience

Identify the target audience for the survey based on the product or service in question. Participants should be familiar with the market and are potential buyers or users of the product or service.


Conduct the survey

Administer the survey to a representative sample of the target audience. Respondents will provide their perceived price points for each of the four questions.


Compile and analyze the data

Gather the responses from the survey and arrange them in a suitable format, such as a spreadsheet. Calculate cumulative percentages for each response to the four questions.


Plot the cumulative percentages

On a graph, plot the cumulative percentages for each of the four questions. The x-axis represents the price points, and the y-axis represents the cumulative percentage of responses.


Identify the intersections

Find the points where the curves for the Bargain Price and Too Expensive questions intersect, as well as the point where the Too Cheap and Too High questions intersect. These intersection points represent the optimal price range.


Determine the optimal price range

The optimal price range lies between the intersection points found in the previous step. The Point of Marginal Cheapness (PMC) represents the lower bound, and the Point of Marginal Expensiveness (PME) represents the upper bound. The range between these two points indicates the acceptable price range for the target audience.


Evaluate and refine

Review the findings, taking into account additional factors such as market trends, competition, and costs of production. Adjust the pricing strategy accordingly and consider repeating the process with a new sample or revised product/service offering to continue refining the pricing strategy.

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