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# How To Effectively Implement Gabor Granger Pricing Method

Gabor Granger has been a game-changer for most marketers. Here’s why!

## Introduction To Gabor Granger Survey Method

Gabor Granger Pricing Method is a game-changing marketing strategy that enables you to maximize your profits. It was developed by Gabor Granger, who is an expert in pricing strategy and has consulted with some of the world’s biggest corporations. GGP provides marketers with the competitive edge they need to put themselves ahead of their competitors.

Gabor Granger Survey is one of the best ways to assess how much sensitivity your customers have to prices. You can define and use it to help you change the price of your products or services.

Gabor Granger approach is also an objective way to determine whether there is an effective price for a product or service, so it can be used by marketers for setting prices for more profitable products and services (similar to famous Pareto’s 80/20 rule).

You must use these steps to make sure your customers are aware of the price before they buy your product or service. It also allows you to change prices to respond to shifts in market demand and also react quickly when the market moves away from your original forecast.

1. Conduct your survey

This is to determine the most important factors that influence customers’ purchasing decisions.

2. Analyze the data

The response is analyzed and the results are recorded.

3. Find the price sensitivity to calculate possible elasticity

To generate value, use the POG formula to find the price sensitivity of your product or service. Transforming price elasticities into percentages will give you a great insight into your pricing.

4. Calculate the profit margin

This is what you expect from every unit sold, so you can calculate the return on investment using the formula: profit = (income-cost)/volume sold. If it is not enough to cover your production costs, then how to increase sales? One of the ways to do this is to reduce prices.

4. Generate graphs or charts of the data

Gabor Granger analysis is an incredibly useful data-based approach that can transform your business into a highly profitable one. Conduct more surveys so you can use this strategy again to get more valuable data that will help you make the best decisions for your marketing efforts.

5. Draw conclusions about what you found in your study

From the study, you found out if your customers are highly sensitive to price and if they are willing to pay.

The Gabor Granger pricing method will also help you determine why products or services have not been as profitable as you expected.

## Finding Where To Apply Gabor Granger Method:

The following are key steps in making sure you’re targeting the right audience:

1. Determine what your goal for this campaign is, whether it be building customer loyalty, gaining market share, or another important factor.
2. Calculate which tier you are targeting by dividing the population into general groups that match your target demographic.
3. Estimate how much each customer would pay for each tier and apply the best-fitting price for each tier to your cost base.
4. Estimate how much you will earn in revenue from each tier and apply this to your profit.
5. To calculate the profit, you simply multiply both sides of the equation by the number of customers in each group.
6. Now that you have your target pricing objectives, offer different products in different price tiers. This will enable you to know where to set your prices and which one is more profitable. If there are gaps between sides, then increase prices in one or both groups or offer a free bonus with purchase through a special coupon code or product offer.
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