Ask Teresa: How Can You Test a Customer’s Willingness to Pay? - Product Talk

One technique I like for gauging value is to see if the user would be willing to pay for it, even if you have no intention of charging them for it. We're looking for the user to pull out his or her credit card right then and there and ask to buy the product

First, you want to understand your customers' overall WTP for your product—the price range they would consider reasonable (if, in fact, they would pay anything at all). Then you have to ask yourself whether that price range would work for your company. It may not if you can't deliver a market-acceptable product at a price that makes you a profit. S

see if the user would be willing to pay for it, even if you have no intention of charging them for it.

Understanding if customers are willing to pay for your invention, before you commit too many resources to building and launching it, will dramatically increase your likelihood of success. By designing your product around a price, your innovations will stand a far greater chance of surviving and thriving. Figuring how much customers will pay for you

Ask questions like “Do you value these products/features?” and then ask why. Then switch gears to ask questions like “What would you consider an acceptable price?” Switching from value to price is an easier transition to make in determining customer WTP.

In this book, we have boiled these secrets down into the following nine new rules for innovation success. The rules are contrary to what most executives have learned about product development: Have the “willingness to pay” talk with customers early in the product development process. If you don't do it early, you won't be able to prioritize the pro