Here are some basic findings on using a Pay-What-It’s-Worth pricing system from the research paper Pay What You Like by J Fernandez and B Nahata:
If a buyer feels that a product or service provides a positive value, they will never ‘free ride’ and not pay anything.
Under certain conditions Pay-What-It’s-Worth can provide a larger profit than uniform pricing. A business that can best benefit from PWIW is:
- focused on personal service
- creating loyal clientele
People pay what they do because of their:
- market price awareness
- net income
The pricing system is used by business owners throughout the world.