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Retailers (online and offline) really care about Price Elasticity. It determines their bottom line.
Price Elasticity Definition
The measure of the responsiveness of consumers to a change in a product’s cost. Definition source.
It follows that if the price of a product is increased overall units sold drop, and vice versa. But this is not always the case.
The Heinz story
Heinz discovered by increasing the size of ketchup bottles from 24oz to 36oz sales increased with no reduction in buying frequency. Turns out consumption of ketchup follows its own convention. Mothers buy ketchup for kids so when there’s less than 3/4th left they ask their kids to go slow and the consumption rate falls.
With the 36oz bottle, 3/4th is still a lot. When consumption was viewed side by side it was discovered they got over at approximately the same time. The replacement of 24oz with 36oz helped Heinz increase ketchup sales by 13%.
A Little About Us
We’ve spent the last 12 years in our marketing lab, experimenting with ways to optimize conversion rates and grow sales. We’re ready to spill the beans.
The following articles will save you 12 years:
— Before revealing the secret that’ll improve conversion rates by 20% let’s zoom out to see the forest for the🌲: Optimize Conversion Rates: A Totally Different Approach
— For every 1,000 product pitches encountered the shopper buys one item (and we’re being generous). You want this to be your product. How do our brains choose? They rely on a ranking algorithm, not dissimilar to the one Google uses for search results. Our conversion copywriting process is designed to get your pitch to the front of the line.
— The link above revealed how to construct the perfect sales pitch. Next, this killer pitch needs to be infused into your product page. We have just one chance to convert this visitor (only 15% of visitors ever return). Read this next: Infusing Your Product Story To Your Product Page.