{"id":2401,"date":"2018-08-31T14:29:33","date_gmt":"2018-08-31T14:29:33","guid":{"rendered":"https:\/\/www.enginius.biz\/?page_id=2401"},"modified":"2020-01-05T09:40:15","modified_gmt":"2020-01-05T09:40:15","slug":"price","status":"publish","type":"page","link":"https:\/\/www.enginius.biz\/index.php\/faq\/price\/","title":{"rendered":"Price optimization"},"content":{"rendered":"\t\t
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\n\t\t\t\t\t\t\t\t\tHelp Page\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Price optimization<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Get answers for the most frequently asked questions about the Enginius price optimization module. For a quick overview, we suggest you check the introductory video first.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Price optimization in a nutshell<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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The price optimization module in Enginius uses the Gabor\u2013Granger method to determine the price for a new product or service.<\/p>

To use the Gabor-Granger method in a survey, the manager identifies a few potential price points, from low to high, and then ask respondents how willing they would be to buy the product or service at each of those price points.<\/p>

The respondents answer using a 5-point purchase intent question, from \u2018Definitely Not Buy\u2019 to \u2018Definitely Buy\u2019. These answers are then transformed into probabilities of purchased, combined together, and used to produce a demand chart. That chart can then be used to estimate optimal price levels.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t

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Download the tutorial<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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To download the Enginius tutorial in pdf format: (1) Follow the link below. It will open an example data set, then (2) Click on the link in the upper-left corner of the screen.<\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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LOGIN \/ REGISTER <\/i><\/a><\/div>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
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Frequently asked questions<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/i><\/span>\n\t\t\t\t\t\t\t\t<\/i><\/span>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t\t\t\tHow do we transform responses (1-5) into probabilities (0-100%)?<\/a>\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t

Many companies specialize in estimating these probabilities based on experience or benchmarking studies. The values provided by default in Enginius (0% 0% 0% 20% 50%) constitute averages that are probably acceptable guesses.<\/p>

One thing is certain: people often overestimate how certain they are to buy a product or service. This is the reason why only the top 2 choices are usually associated with purchase probabilities above 0%, and why even the \u2018Definitely Will Buy\u2019 answer is rarely associated with a probability above 65%.<\/p><\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t

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\n\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/i><\/span>\n\t\t\t\t\t\t\t\t<\/i><\/span>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/span>\n\t\t\t\t\t\t\t\t\t\t\t\tThe profit function keeps increasing after the last price point. How should I estimate the optimal price?<\/a>\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t

Unfortunately, you cannot.<\/p>

The Gabor-Granger method, and the specific response function implemented in Enginius, is pretty good at interpolating between price points, but cannot be used reliably to extrapolate outside the tested price range.<\/p>

If the optimal price solution seems to be above the highest price point tested in the survey, the best strategy is to collect another data set with a wider price range.<\/p><\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

https:\/\/youtu.be\/bnjinO9Id0AHelp Page Price optimization Get answers for the most frequently asked questions about the Enginius price optimization module. For a quick overview, we suggest you check the introductory video first. Watch Video Price optimization in a nutshell The price optimization module in Enginius uses the Gabor\u2013Granger method to determine the price for a new product … <\/p>\n

Continue reading “Price optimization”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"parent":1145,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"elementor_header_footer","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"yst_prominent_words":[426,429,407,67,736,425,430,423,156,154,157,155,377,421,427,424,428,422,159,158],"class_list":["post-2401","page","type-page","status-publish","hentry"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.enginius.biz\/index.php\/wp-json\/wp\/v2\/pages\/2401","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.enginius.biz\/index.php\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/www.enginius.biz\/index.php\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/www.enginius.biz\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.enginius.biz\/index.php\/wp-json\/wp\/v2\/comments?post=2401"}],"version-history":[{"count":0,"href":"https:\/\/www.enginius.biz\/index.php\/wp-json\/wp\/v2\/pages\/2401\/revisions"}],"up":[{"embeddable":true,"href":"https:\/\/www.enginius.biz\/index.php\/wp-json\/wp\/v2\/pages\/1145"}],"wp:attachment":[{"href":"https:\/\/www.enginius.biz\/index.php\/wp-json\/wp\/v2\/media?parent=2401"}],"wp:term":[{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.enginius.biz\/index.php\/wp-json\/wp\/v2\/yst_prominent_words?post=2401"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}