Recall the first two quantified relationships.
In this example (using actual data), we see three trends associated with increased prices.
- Customers Are Less Likely To Repurchase Again.
- Customers Purchase Fewer Times Per Year.
- Customers Purchase Fewer Items Per Order.
Is this bad?
The key is to multiply the relationship out across metrics ... if the net result is an increase in gross margin dollars, the short-term is protected.
The long-term, however, is undoubtedly hurt. You'll have fewer customers long-term, and that means you'll most likely have a smaller business than you otherwise would have.