Learn more about Van Konan Price Optimization in our Lighthouse Academy course!
1. Adding a Van Konan Price Optimization test
- Click the Van Konan icon in the Research tests menu of the left sidebar, drag the icon into place on your survey, or click the Add a Question button at the bottom of the Survey Editor, and select Van Konan.
- Write a short description of your product in the Product Description field, or add more context by describing your product with prior placed Video Questions, Image Questions, or Instruction Text.
- Click the respective titles to choose whether to optimize price simply for Price Sensitivity (Van Westendorp), or add optimization for Maximum revenue, Maximum sales frequency, and/or Maximum profit.
Note: For one-time purchases, such as buying a house, car, or boat, may not be practical to calculate the frequency in this experiment. For these use cases, click the ON button in the Max Sales Frequency line to turn it OFF, while still testing for Max Profit. Because these modules build upon each other, you must include Max Revenue to be able to measure Max sales frequency and/or Max profit.
2. Adding more parameters
- Enter your best guess of the optimal price in the Estimated Retail Price text box, including the currency symbol you would like respondents to use.
Note: this number will not be visible to respondents, however, the format you use may have an impact on the answers you receive.
- Click the drop-down to indicate the noun for your test, whether you are selling a product, service, or package.
- Click the next drop-down to indicate the verb that best describes the sale event, from purchase, subscribe, or sign up.
- Enter your best guess of the Total Addressable Market into the text box below the conversion event drop-down. If you are unsure of your TAM, the test will default to 1000.
- Click the Once an hour drop-down to change the start of the range for a reasonable purchase frequency of your product, and then click the second drop-down to set the end of the range.
- Click Adjust the frequency scale to adjust the actual phrasing of each stop on the frequency slider that will be presented to respondents.
- Enter the unit cost and quantity in the appropriate text fields. Checking the box next to Cost changes with 1 unit increment will calculate a smoother line in the price change gradient.
Note: The estimated sales price, TAM, and unit cost can all be adjusted on the Results page.