You don't know what price the market will bear
Ask 4 pricing questions to find the optimal price range. Takes 50 responses to get actionable data.
When to use
You want data-driven pricing instead of gut-feeling pricing. You have 50+ users to survey.
Hypothesis template
If we survey fill in: 50+ users with the Van Westendorp method, we'll identify the optimal price range and adjust pricing to maximize revenue.
Method
The problem: You picked your price based on gut feeling or competitor pricing. You might be leaving 50% of revenue on the table.
How to do it:
- Send a 4-question survey to active users:
- At what price would it be so cheap you'd question the quality?
- At what price would it be a great deal?
- At what price would it be getting expensive but you'd still consider?
- At what price would it be too expensive to consider?
- Collect 50+ responses
- Plot the results to find the optimal price range
- The intersection of "too cheap" and "too expensive" is your optimal price
- Test the new price with new users while grandfathering existing ones
Key insight: Most SaaS products are underpriced. The Van Westendorp method often reveals willingness to pay 30-50% more than current pricing.
Success metrics
- •Survey response count
- •Optimal price range identified
- •Revenue change after adjustment
- •Conversion rate at new price
Prerequisites
- 50+ active users to survey
- A survey tool
- Willingness to adjust pricing based on results
Common pitfalls
- •Surveying fewer than 50 people
- •Only surveying free users (include paid users)
- •Changing prices without grandfathering existing users
- •Surveying too frequently (once per year is enough)
Source: Van Westendorp Price Sensitivity Meter. Standard pricing research method used by SaaS companies worldwide.
Suggested ICE scores
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