Willingness to Pay

Challenge:

An Education Software Provider had developed a new service and was struggling with how to structure price (per session, per month, etc.), what to price, and how to bundle this new service with the existing offerings. Additionally, they had limited pricing standards and guidance for their existing offerings that didn’t account for customer sentiments.

Solution:

INSIGHT began by deploying a market survey to the Software Provider’s current and potential customers to understand purchasing motivations and decision factors. Then, we conducted two sets of analyses:

• A Conjoint Analysis to test different feature sets and determine the level of importance and value that customers place on each attribute to understand how to price as well as bundle features
• A Gabor Granger exercise to test and understand max willingness to pay

Then, we utilized results to determine price sensitivity, map demand-revenue analysis, and derive the optimal price to maximize customer conversion and revenue.