8 Factors of Low Price Sensitivity

How sensitive to price are your customers? Should you make that price cut to keep up with new entrants to the market?

Whilst this is obviously a complex issue, there are a number of factors to search for in your customer base that may indicate they are less worried about the price of your goods or service than you think:

8 Factors of Low Price Sensitivity:

  1. You have a distinctive product
  2. Customers are unaware of alternatives
  3. Customers have difficulty comparing the quality of alternatives
  4. The cost is a negligible part of the customers overall income
  5. The cost of your offering is only a small part of an end product’s total cost
  6. Some or all of the cost is paid by another party
  7. The product or service relates to previous asset or expenditure
  8. The customer assumes your product or service is better

Businesses can use the 8 Factors of Low Price Sensitivity to better understand how price affects their customers.

If your customers are price sensitive, there are a few things you can do to stop them focusing on price, which I cover in another post here.



This list is a modified version of the one found in Kotler & Keller’s “A Framework for Marketing Management”, which also lists a ninth factor:

9. Buyers cannot store the product.

However I have some doubts on this one, so have left it out until an explanation for it is found. Perhaps, if the consumer can’t store the product, would it be a perishable, leading to a repeat purchase and a more commodity based pricing structure?

If you can explain it to me, hit me up in the comments! Thanks!


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  1. Pingback: 4 Strategies To Stop Customers Fixating on Price - www.mbanights.com

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