An Empirical Study Of Price Thresholds And Price Sensitivity

Abstract

Consumer price sensitivity is studied in the context of supermarket grocery shopping using a survey of supermarket shoppers. It is shown that price sensitivity depends both on product features and consumer characteristics. Price laws such as Weber’s law and the Weber-Fechner law are empirically investigated. Shopper profiles are identified on the basis of price sensitivity by discriminant analysis of variables representing consumer demographics, shopping behavior, and price awareness.