How can you evaluate customer price sensitivity?

Customer price perception plays a crucial role in pricing strategy. It refers to the customer's opinion of a product's value. If customers perceive that the product's price is greater than its value, they are less likely to purchase it. Conversely, if they perceive that the value is greater than the price, they are more likely to make a purchase. Therefore, understanding customer price perception can help businesses price their products in a way that maximizes sales and profits.

The pricing strategy spreadsheet template can be used to evaluate market share gained by tracking the market share captured over time. This can be done by inputting data related to your product's pricing, the competition's pricing, and the overall market conditions. By analyzing this data, you can see how changes in your pricing strategy affect your market share.

Marketing spend plays a crucial role in pricing strategy as it directly impacts the cost of acquiring a customer (CAC) and the lifetime value of a customer (LTV). The more a company spends on marketing, the higher the CAC. This needs to be factored into the pricing strategy to ensure profitability. Additionally, marketing spend can influence customer perception and demand, which can also affect pricing.