A survey is a research method that collects data from a population. Surveys are used to collect data from individuals, institutions, or virtually any kind of research study that can be conducted with surveys. Surveys may be conducted by telephone, personal interview, or mail. A typical survey consists of a list of questions or statements about an issue of interest.
One form of Survey is Van Westendorp Analysis, which a lot of people use nowadays. The Van Westendorp analysis solves the pricing problem by asking potential buyers how they will respond to different prices. This is a very simple technique that people use all the time without even realizing it.
What is Van Westendorp Analysis?
It is a pricing strategy wherein the equilibrium prices of a product are determined by surveying consumers and asking them to rate their feelings about various possible prices. The survey asks buyers how they feel whether or not they would buy at different prices.
Then, the researcher varies the price and asks for respondents’ opinions again. At each price, when respondents answer ‘yes,’ this means that at least some potential customers are willing to purchase at that price.
Some consumers answer “no” for a high price and “yes” for a low price when asked if they would buy the product. This is called a “fear response.”
The researcher will use the range of prices that have consulted equal proportions of these “fear responses” as the final prices.
Van Westendorp Questions:
The following questions are examples of what’s in the Van Westendorp Analysis. You can even use your own questions for one of your products. Please remember to attach the answers to these questions in the responses section on each page:
“If the price was ______, would you buy [it]?”
“If the price were ______, would you buy it?”
Van Westendorp Analysis Example:
A researcher has a product whose price is $15. The researcher asks 100 potential buyers, who receive incentives of 10 cents per question answered correctly. Each possible range of prices is now broken into equal portions of 5 cents, and the survey asks again:
1) “If the price were $10, would you buy it?”
2) “If the price were $12.50, would you buy it?”
3) “If the price were $15, would you buy it?”
4) “If the price were $16.50, would you buy it?”
This is generally done online. The Van Westendorp prices can be changed to any other price within the range that has been tested. Some marketers use this to test pricing in television commercials at different times of the day.
Uses of Van Westendorp Analysis:
You can use Van Westendorp Analysis to test the pricing on many things like
a) Luxury items,
c) Clothing, … and much more.
You can even use this on things like gas prices, food, etc. It’s all up to you! Just remember to take the survey beforehand and remember to give the incentives for it, because you need to remember that customers are not just numbers; they are people with thoughts and emotions, who actually do buy things.
In conclusion, Van Westendorp Analysis is one of the best pricing strategies. You can use this on other companies, or even yourself. You could use it on cars, food, clothes, and anything else you think of. This is a very easy learning tool that will help you succeed. This will help you get a better understanding of your customers and what they want.