Van Westendorp (the Price Sensitivity Meter) is a customer survey technique for finding acceptable price bands before you launch or repricing a product.

How it works

Respondents answer four questions about the same product:

1. At what price is it so cheap you doubt quality?
2. At what price is it a bargain?
3. At what price does it start to feel expensive?
4. At what price is it too expensive to consider?

You plot cumulative curves for each answer. Key intersections define:

• Point of Marginal Cheapness (PMC): where “too cheap” meets “expensive”
• Point of Marginal Expensiveness (PME): where “too expensive” meets “cheap”
• Optimal Price Point (OPP): where “too cheap” and “too expensive” cross
• Indifference Price Point (IDP): where “cheap” and “expensive” cross

The acceptable range usually sits between PMC and PME. A startup might run 100–300 targeted surveys with ideal customer profiles, then compare OPP to planned packaging tiers.

Van Westendorp works best for consumer and SMB products with understandable value. It struggles with complex enterprise deals where price depends on seat count, usage, and services.

Why it matters

• Founders: Avoid guessing a single price from competitor pages. The method gives a defensible starting range for beta pricing and investor conversations.
• Investors: Pricing power affects LTV and gross margin. Seeing Van Westendorp plus early conversion data is stronger than either alone.

Common mistake

Treating the optimal price point as truth without segmenting respondents. Mixed audiences — hobbyists and enterprise buyers in one sample — produce meaningless curves.

Related ideas

See also willingness to pay, packaging strategy, and conjoint analysis.