prAIcing · Free merchant tool
Price elasticity calculator
Will a higher price earn more — or cost you too many sales? Explore the volume, revenue and margin tradeoff. Then replace the assumption with evidence from your shoppers.
Your scenario
Use consistent tax treatment for price and cost. Gross profit here excludes shipping, fees, returns and fixed costs. Demand is assumed, not measured.
Illustrative monthly outcome
-4.7% revenue
Demand is elastic in this scenario: a price increase sacrifices more volume than it gains in price.
| Monthly | Today | Scenario |
|---|---|---|
| Price | €50 | €55 |
| Units sold | 200 | 173 |
| Revenue | €10,000 | €9,535 |
| Gross profit | €6,000 | €6,067 |
Already ran a price test?
Estimate elasticity from your A/B results
Use orders per visitor to account for unequal group sizes. These two prices estimate a local response, not a universal elasticity for every product or season.
ε = ln(conversion B / conversion A) / ln(price B / price A)
One unit per order assumed. Randomize concurrent comparable groups; keep availability and promotions consistent. A positive estimate can reflect noise or a nonstandard demand response. No statistical significance is calculated here.
-1.34
From an assumption to shopper evidence
Your shoppers reveal the tradeoff. Your agent does the work.
A guessed elasticity can make a discount look attractive when it actually destroys margin. prAIcing compares two prices in a controlled 50/50 test and measures revenue or profit per product-page visitor. That evidence informs the next pricing decision — not a competitor’s price alone.
01 · Set the objective
Maximize Sales, Profit or Volume. Define minimum margins, step limits and locked products.
02 · Test & measure
Compare concurrent shopper groups. Measure outcomes per visitor so unequal traffic does not masquerade as demand.
03 · Learn & retest
Roll out a supported winner or keep the original. Revisit the decision as demand and seasons change.
04 · Work across the catalogue
A catalogue with 1,000+ SKUs needs prioritization, not 1,000 manual spreadsheets. Focus tests on products with enough traffic, then work through the queue.
Scale, honestly: current Autopilot runs up to 3 simultaneous tests per store. Catalogue size is not concurrent test capacity; traffic and test duration determine throughput. This is a rolling testing workflow, not a claim that thousands of SKUs have been tested simultaneously or that every product will improve.
Explore the testing methodLess spreadsheet maintenance. More time to grow.
The value is not a single elasticity number. It is a repeatable system: choose a business goal, test a price, measure the outcome, keep what works and retest. Use your time for acquisition, merchandising and customer retention instead of manually revisiting every SKU.
Common questions
What is price elasticity of demand?
Price elasticity measures how quantity demanded changes relative to price. An elasticity of −2 means a small 1% price increase is associated with roughly 2% less demand. The simulator uses a constant-elasticity model: new quantity = old quantity × (new price / old price) raised to the elasticity.
How do I calculate elasticity from an A/B price test?
For two concurrent randomized groups, compare orders per visitor rather than raw order totals. The local estimate is ln(test conversion / control conversion) divided by ln(test price / control price). This assumes comparable groups and one unit per order; it is not a confidence test and can be noisy with few orders.
Will raising my price increase revenue?
Under a constant-elasticity assumption, revenue rises with price when elasticity is between −1 and 0, remains unchanged at −1, and falls below −1. Gross profit can behave differently because unit costs matter. A scenario is not proof: validate the outcome with real shoppers.
Can prAIcing test thousands of SKUs continuously?
The proposition is a rolling, prioritized learning cycle across large catalogues, not thousands of concurrent experiments. Current Autopilot allows up to 3 simultaneous tests per store. Products with enough traffic are tested first; low-traffic SKUs may take much longer to yield useful evidence.
Does this calculator change my store prices?
No. It is a free, local scenario tool. It does not connect to your store, save settings or publish prices. prAIcing’s live tests are separate and subject to merchant controls.
Put shopper evidence behind your next price move
Set your goal and limits. Let the agent handle the testing cycle, while you focus on your next collection, customer experience or growth initiative.
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