Price Changer
This smart calculator analyzes your data and suggests best price change for profit maximization.
How to price your product? give a discount or raise the price?
What drives your choice? Usually, price change decisions are emotion-driven. It is difficult to make a decision rationally because there are just too many factors: inflation, competition, customers' demand, analogs in the market, power of the brand, et. Cetera. Who can sort it all out?
Some businessmen are afraid to increase the price, thinking that their customers will immediately flee. But a slight mark-up wouldn’t scare the majority away and will give an important profit boost, which compensates a few clients loss. What about discounts? In a demand-elastic environment, a discount may bring a significant number of clients that cover margin loss by orders quantity. However, if the demand is inelastic (i.e. in the luxury segment), a discount would just cut your margin without giving additional quantities in return.
Price Changer is a tool that takes into account every factor, estimates price elasticity of demand, evaluates the influence of market share and competition, and builds a forecast for how the profit and quantities will change at every pricing step.
As a result, the instrument finds a pricing decision that gives the highest profit. Try filling up as many details as you can to see the suggested price change, as well as a graph with a profit curve, so that you can feel how your profit volume reshapes over pricing changes.
how it works?
1
Input product and market data.
2
Input information about competitors.
3
Get recommendations from Price Changer.
Interface go-through video. Parameters that influence price of your product
Price Changer calculator
Options short description
Segment: 1- mass market; 2 – basic / well-enough; 3 – standard; 4 – premium; 5- Luxury
Current sales price: the price that you set for most customers
Current volume: quantities that you sell pro period (e.g. year/month)
Current margin: Margin formula is 1-(cost/price)
Price sensitivity: how clients react to change: 1 – non-sensitive → 10 – sensitive
Product originality: 1 – boring copy → 5 – very original
Product maturity: 1 – fresh to market → 5 – veteran
Number of competitors: take only direct competitors (same segment)
Brand loyalty: 1 – customer doesn’t care → 5 – very loyal
Market share: your share in pcs (not in value)
Market limit: Which maximum market share one can reach
Competition reaction: 1 – no reaction, 2-react only after 25% difference, 3 – react after 10%, 4 – react after 5%, 5 – react after 2%
Top competitors
Input information about your competition. Put as many as you know, but not necessary 5. Note that if there’s any share, price should be mentioned.
If no competitors are mentioned, insert average unit price for “all the rest”.
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