Customers are likely to react most strongly to price changes when:

Customers are likely to react most strongly to price changes when they are familiar with alternative offerings. This familiarity makes them more aware of the market value for similar products, which can enhance their sensitivity to price adjustments. When customers recognize that there are similar products available at different prices, a change in price can prompt them to evaluate their options more closely, potentially leading to switching to a competitor if they perceive a better value elsewhere. Consequently, the competitive landscape plays a significant role in shaping customer reactions to pricing strategies.

In contrast, when a product has a low perceived value, customers may not react as strongly to price changes, as they may not view the item as critical or worth the effort to seek alternatives. Similarly, for luxury items, while high prices might attract attention, changes in pricing may not prompt a strong reaction if the buyer is motivated by prestige and brand loyalty rather than price alone. Lastly, if customers have taken a financial risk, they may demonstrate loyalty to the product or brand despite price changes, as they may feel committed or invested rather than reactive.