In today’s competitive marketplace, pricing strategy is crucial. Companies need to strike a balance between profitability and customer satisfaction. To do this, many businesses rely on pricing surveys to gauge how much customers are willing to pay for their products or services. Whether launching a new product or re-evaluating the price of an existing one, pricing surveys provide critical insights into consumer perceptions of value.
This post will explore the different types of pricing surveys, provide pricing survey questions examples, and offer guidance on how to effectively use them to shape pricing strategy.
What are pricing surveys?
A pricing survey is a market research tool designed to assess customer willingness to pay for a product or service. They help you understand the price range that consumers consider reasonable and where they might hesitate to make a purchase. Pricing surveys can be used for various reasons, including:
- Testing different pricing strategies before launching a product.
- Understanding price sensitivity.
- Identifying acceptable price ranges for different customer segments.
- Adjusting prices for existing products or services to reflect current market conditions.
Why are pricing surveys important?
Without understanding how customers perceive the value of a product, there is a risk of underpricing or overpricing. Overpricing could lead to lost sales, while underpricing could result in lower profits or the perception that a product is of inferior quality.
Pricing surveys help avoid these pitfalls by providing a structured method for gathering data on price preferences, which will help:
- Optimize pricing strategies based on real data.
- Improve market positioning by understanding customer value perception.
- Increase profit margins by identifying the highest price point consumers are willing to pay.
- Decrease the risk of pricing too high or too low, avoiding lost opportunities.
Here are the various types of pricing surveys.
6 Types of pricing surveys
There are several types of pricing surveys, each with its own strengths and ideal use cases. Choosing the right one depends on goals, the nature of the product, and the target audience.
| Pricing survey method | Key benefits | Limitations | Best use cases |
| Van Westendorp Price Sensitivity Meter | Defines acceptable price range and optimal pricing point | Doesn't measure actual purchase intent, only perceptions. | New product pricing, price perception analysis. |
| Gabor-Granger Pricing Method | Simple to implement and identifies price elasticity. | Hypothetical, not real purchase behavior; ignores competitor pricing. | Finding optimal price for maximum revenue. |
| Monadic Price Testing | Mimics real-world buying behavior and eliminates comparison bias. | Requires a large sample size; doesn't track price elasticity over time. | Testing pricing strategies in a realistic setting. |
| Willingness-to-Pay (WTP) Surveys | Directly measures price sensitivity and willingness to pay. | Customers may understate WTP; doesn't consider competition. | Assessing price sensitivity for different customer segments. |
| Discrete Choice Modeling (DCM) | Provides insights into how customers value product attributes. | Complex statistical analysis required; needs a large sample. | Optimizing product offerings and pricing strategy. |
| Conjoint Analysis | Helps optimize pricing and feature bundling based on real preferences. | Doesn't measure absolute demand, only relative preferences. | Analyzing trade-offs between price and product features. |
1. Willingness to pay
Willingness-to-pay (WTP) surveys are a pricing research method used to determine the maximum price customers are willing to pay for a product or service. WTP surveys use direct questioning to gauge customer price limits. There are multiple ways to structure a WTP survey:
- Direct Open-Ended Questions - for example “What is the highest price you would pay for this product?”
- Price Range Questions - for example “Which of the following prices seems reasonable for this product?”
By directly asking customers about their price sensitivity, businesses can set optimal prices, maximize revenue, and improve pricing strategies based on real customer insights. WTP surveys should be combined with actual purchase data and competitive pricing analysis for the most accurate pricing decisions.
2. Van Westendorp Price Sensitivity Meter
The Van Westendorp Price Sensitivity Meter is one of the most widely used pricing research methods. It involves asking customers four questions to gauge their price sensitivity and determine the optimal price range for a product or service based on customer perception.
How Does the Van Westendorp Method Work?
Instead of directly asking customers how much they would pay, the Van Westendorp PSM presents respondents with four key pricing questions:
- At what price would you consider this product to be too expensive?
- At what price would you consider this product to be a bargain—so cheap that you’d question its quality?
- At what price would you consider this product to be starting to get expensive, but you’d still consider buying it?
- At what price would you consider this product to be too inexpensive to be of any value?
These four product price survey questions help define the price point at which customers feel uncomfortable and where they feel the product offers good value.
- Too Cheap (Lower Price Limit): Below this price, customers may assume poor quality.
- Bargain Price: The price where customers feel they are getting good value.
- Expensive but Acceptable Price: The upper threshold where customers still see value.
- Too Expensive (Upper Price Limit): Beyond this point, customers reject the product due to high cost.
The answers are then plotted to identify an optimal price range that maximizes the potential for sales.
Once the responses are collected, they are plotted on a cumulative distribution graph where the intersections of the lines indicate key pricing thresholds:
- Optimal Price Point (OPP): The price where the percentage of respondents who think the product is too cheap meets those who think it’s getting expensive.
- Indifference Price Point (IPP): The price where the percentage of people who think the product is a bargain meets those who find it expensive.
- Acceptable Price Range: The space between the Too Cheap and Too Expensive price points.
This pricing model helps businesses determine a reasonable price range that balances customer perception, perceived value, and profitability.
3. Conjoint analysis
Conjoint analysis is a more complex pricing survey technique that helps in understanding how customers make trade-offs between different product features and prices. Instead of directly asking about prices, customers are asked to choose between different product configurations, each with varying features and price points. This provides information on the relative importance of price compared to other attributes (e.g., quality, brand, functionality).
In a conjoint survey, respondents are shown multiple product variations with different attributes, such as:
- Price (e.g., $20, $30, $40)
- Features (e.g., battery life, screen size, storage capacity)
- Brand (e.g., Apple, Samsung, Sony)
Each respondent must choose their preferred option from a set of choices. By analyzing these decisions, businesses can identify:
- Which attributes customers value most (e.g., do they prioritize price or features?)
- The price elasticity of demand (how price changes impact buying behavior)
- The ideal price-feature balance that maximizes sales and profitability
There are different types of conjoint analysis, depending on the level of complexity:
- Choice-Based Conjoint (CBC): Respondents choose one option from a set of products with different attributes.
- Adaptive Conjoint Analysis (ACA): The survey adjusts based on previous answers, offering more personalized choices.
- Full-Profile Conjoint Analysis: Each product is presented with a complete set of attributes, allowing for detailed analysis.
This method is ideal for products with multiple features where pricing might change depending on the combination of options offered.
Example product price survey questions:
- Would you prefer a smartphone with a high-resolution camera priced at $799, or a model with more storage priced at $749?
- Would you purchase a premium service with additional customer support at $49/month, or a basic package at $29/month?
Conjoint analysis can provide detailed insights when:
- Launching a new product with multiple pricing options.
- Testing different pricing models or packaging strategies.
- Understanding which features customers are willing to pay more for.
- Finding the balance between pricing and customer satisfaction.
4. Gabor-Granger technique
Gabor-Granger is a straightforward method that measures price sensitivity by presenting respondents with different price points and asking them how likely they are to purchase the product at each price.
Example pricing survey questions:
- How likely would you be to buy this product at $50?
- Options: Definitely, Probably, Probably Not, Definitely Not
- How likely would you be to buy this product at $100?
- Options: Definitely, Probably, Probably Not, Definitely Not
- How likely would you be to buy this product at $150?
- Options: Definitely, Probably, Probably Not, Definitely Not
By analyzing the percentage of customers who respond positively at each price point, the optimal price at which the most customers will be captured without sacrificing revenue can be determined.
The results from multiple respondents are then aggregated to create a demand curve, which reveals:
- The percentage of customers willing to buy at each price point
- The price at which revenue would be maximized
- The highest price customers are willing to pay before demand drops significantly
5. Monadic price testing
Monadic price testing involves presenting respondents with only one price for a product (randomly assigned from a set of prices) and asking their willingness to make that purchase. Since each respondent is exposed to only one price, their decision is unaffected by comparison to other price points.
Example product price survey questions:
- Would you be willing to purchase this product at $75?
- Yes/No
- If no, what price would you consider to be reasonable?
This method mimics real-world purchasing conditions in which customers typically only see one price when making a decision. The responses from different price groups can be compared to determine the price elasticity of demand.
6. Discrete choice modeling (DCM)
Discrete choice modeling is similar to conjoint analysis but focuses more on the decision-making process between different products. Customers are presented with a set of products at varying price points and asked to choose which one they would purchase.
This method is useful when wanting to understand not only how price affects consumer decisions but also how a product compares to competitors in a side-by-side comparison.
Example pricing survey questions:
- Would you choose Brand A at $150 or Brand B at $120?
- Between these two options, which would you be more likely to purchase?
- A product with enhanced security features at $60.
- A product with basic security features at $40.
How to use pricing surveys effectively
Knowing which pricing survey to use is important, but it’s equally crucial to administer them correctly to ensure the gathered data is accurate and actionable.
1. Define clear objectives
Before conducting any pricing survey, it’s essential to define clear objectives. Are you looking to establish a new price for a product? Trying to understand consumer price sensitivity? Do you want to test different price points against specific features?
Having a clear objective will help in choosing the right type of pricing survey and the correct questions.
2. Segment the audience
Price sensitivity often varies among different customer segments. Younger ones may prioritize affordability, while older ones might be willing to pay more for premium features. Segment respondents by demographics, purchase history, or other relevant factors to get a more nuanced view of pricing preferences across different groups.
3. Ask the right questions
Effective pricing survey questions should be clear, unbiased, and directly related to objectives. The way questions are phrased can significantly influence how respondents answer, so it’s important to avoid leading questions that may skew results.
For example, asking, “How likely are you to buy this high-quality product at $100?” subtly implies that the product is of high quality, potentially leading to higher willingness-to-pay responses. Instead, a more neutral approach would be, “How likely are you to purchase this product at $100?”
Additionally, asking open-ended questions like, “What price would you be willing to pay for this product?” can provide useful qualitative insights but should be balanced with structured questions for more quantitative analysis.
We’ve previously covered both bad survey questions and good survey questions to help you better understand what works and what doesn’t. Use these insights to craft effective pricing survey questions that inspire meaningful and well-written responses.
4. Test across multiple price points
When conducting pricing surveys, it’s crucial to test multiple price points rather than just one or two. Doing so delivers a broader understanding of how price elasticity changes across different segments and helps identify the ideal price that balances volume and profitability.
For example, in the Gabor-Granger method, customers might be presented with five different price points ($25, $50, $75, $100, $125) to see how the likelihood of purchasing changes with each option. This approach can help find the “sweet spot” where consumer demand and price align most favorably.
5. Analyze and act on the data
Once survey data is collected, it’s time to analyze it. Look for trends, outliers, and patterns that indicate how customers are responding to different price points. Tools like the Van Westendorp model will visually display acceptable price ranges, while conjoint analysis will give deeper insights into the trade-offs customers make between price and product features.
Based on the analysis, you can:
- Set an optimal price for a product.
- Adjust pricing for different customer segments.
- Bundle products or services to create more value for customers.
- Evaluate whether a product’s perceived value aligns with its actual price.
Remember, pricing is not a one-time decision. Market conditions, competition, and consumer preferences evolve, so regularly re-evaluating pricing strategies based on updated surveys and data is key to maintaining profitability and competitiveness. Our post How to analyze survey data can help you make the most of a survey’s responses using actionable tips from the article.
Pricing survey questions examples
Here’s a recap of pricing survey questions examples that can be tailored to specific products and audiences:
Willingness to pay:
- What is the highest price you would pay for this product/service?
- What would you be willing to pay for this product?
- Which of the following price points seems reasonable for this product/service?
Van Westendorp Price Sensitivity Meter:
- At what price would you consider this product to be too expensive?
- At what price would you consider this product to be too cheap that it would reduce your trust in its quality?
- At what price would you consider this product to be reasonably priced?
- At what price would you consider this product to be expensive but still worth purchasing?
Conjoint analysis:
- Would you rather purchase a laptop with a high-resolution display priced at $1,200 or a laptop with more battery life priced at $1,000?
- If given a choice, would you buy a high-end version of this software at $50/month or a basic version at $20/month?
Gabor-Granger technique:
- How likely are you to buy this product at $50? (Definitely, Probably, Probably Not, Definitely Not)
- How likely are you to buy this product at $75? (Definitely, Probably, Probably Not, Definitely Not)
- How likely are you to buy this product at $100? (Definitely, Probably, Probably Not, Definitely Not)
Monadic price testing:
- Would you purchase this product at $50?
- If not, what price would you consider reasonable for this product?
Discrete choice modeling:
- Which would you prefer? A premium coffee maker priced at $200 or a standard model priced at $150?
- Between these two options, which would you choose? A product with advanced security features at $80 or a basic model at $60?
Create successful pricing surveys with SurveyPlanet
Pricing surveys are indispensable tools for businesses looking to optimize their pricing strategy. From simple approaches like the Gabor-Granger technique to more complex methodologies such as conjoint analysis, pricing surveys provide rich insights into how much customers are willing to pay for a product or service.
Whether launching a new product or revisiting the pricing of an existing one, the right survey can guide you in making data-driven decisions that enhance profitability and customer satisfaction.
The key to success lies in selecting the appropriate type of survey based on your specific goals, asking the right questions, and carefully analyzing the results to inform pricing decisions.
Ready to take the guesswork out of pricing strategy? With SurveyPlanet, you can easily create and distribute professional pricing surveys to gather valuable insights from a target audience. Whether needing to test multiple price points, explore customer perceptions of value, or compare product features, SurveyPlanet’s intuitive tools make it simple to get the data you need.
Get started with SurveyPlanet today and start making data-driven pricing decisions that will boost revenue and customer satisfaction. Create your first pricing survey now.
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