Price Threshold Detector
Identify psychological price cliffs. Input your historical sales or A/B test data to find the exact price points where conversion drops disproportionately.
Input Data Points
Identified Cliffs
Significant resistance encountered here.
Significant resistance encountered here.
Significant resistance encountered here.
Demand Curve & Thresholds
Mind the Gap
Visualizing the 'Ouch' moment.
The Cliff Edge
The red dotted lines show where you lose the most customers. Never price immediately to the right of this line without a major reason.
The Plateau
Flat sections of the blue line indicate price insensitivity. You can raise prices safely within this range (e.g., from $19 to $24) without losing much conversion.
Revenue Optimization
Sometimes crossing a cliff is worth it if the higher price makes up for the volume loss. Calculate Total Profit = Price * Volume to be sure.
Execution Steps
Collect your data: Price points and their corresponding Conversion Rates (CVR).
Input the data into the tool (Price vs Conversion %).
The tool visualizes the demand curve.
Red dotted lines indicate 'Cliffs'—where conversion drops by >25% between price steps.
Price just below the cliff (e.g. $49 instead of $50) to capture volume.
Pro Strategy
- If you see a cliff at $100, price at $99. The psychological difference is massive (Left-Digit Effect).
- If you cross a cliff, you must add significant value to justify the drop in volume. Don't just raise price by $1 if it crosses a threshold.
- Round numbers ($50, $100) often act as cliffs because they signal a new mental budget bucket.
Core Concepts
Psychological Threshold
A price point that triggers a shift in perception (e.g. 2-digits to 3-digits). Crossing this threshold often causes a sharp drop in demand.
Elasticity Cliff
A non-linear point in the demand curve where elasticity spikes significantly, indicating high sensitivity. It contradicts the idea of a smooth demand curve.
Price Resistance
The friction a customer feels when paying. Cliffs represent moments of maximum resistance where the customer re-evaluates the value equation.
What is Price Threshold Detector?
This tool analyzes the 'kinked demand curve'. Unlike standard elasticity models that assume a smooth linear or logarithmic curve, the Threshold Detector identifies discrete step-functions in demand caused by psychological pricing barriers.
Best For
- • Fine-tuning specific price points (e.g. $49 vs $50).
- • Analyzing results from multiple A/B tests.
- • Optimizing for 'Charm Pricing' efficiency.
Limitations
- • Requires granular data points close to the threshold to be accurate.
- • Does not explain *why* the drop occurred, only that it did.
- • Can be noisy if sample sizes at each price point are small.
Alternative Methods
Elasticity Simulator
Better for general trend analysis across a wide range.
Van Westendorp
Better for finding acceptable ranges rather than specific cliffs.
Industry Applications
See how this methodology generates real revenue uplift in different sectors.
SaaS Freemium Conversion
Low conversion on $10/mo plan.
Tested $9 vs $10 vs $12.
Fashion Retailer
Jeans sales dropped when priced at $105.
Analysis showed a cliff at $100. Customers filtered by 'Under $100'.
App Subscription
Users balking at $5.99/mo.
Threshold analysis showed the barrier was $5.00.