Price Point

A strategic price which maximizes demand and revenue for a product or service.

Deeper Insights

Ideally, a seller wants to hit a price point that consumers view as fair and expected. This creates consistent demand. If a price point is too high, consumption and demand will generally decrease. If a price point is low, consumption and demand will generally increase, unless it’s a prestige product. Low price points are frequently used by discount retailers or when selling bundled/bulk items. A poorly-guessed price point will leave money on the table.

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Related Keywords: Price Elasticity, Psychological Pricing, Yield Management, Pricing Strategy