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High Price Sensitivity
Segments where customers are very responsive to changes in price.
Implications
A market condition where consumers are highly responsive to changes in price, often leading to significant changes in demand when prices fluctuate, relevant in industries where products are easily substitutable or where consumers have low brand loyalty.
Example
Example: A grocery chain experiences high price sensitivity in its private-label products, where even small price increases lead to a noticeable drop in sales as consumers switch to competing brands.
Related Terms
Different from low price sensitivity, where consumers are less affected by price changes, high price sensitivity indicates that price is a key factor in purchasing decisions, often requiring careful pricing strategies.
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