Part A1 · Demand and Elasticity

Three Levels of Elasticity

The same word, elasticity, describes three different reactions: the whole market, one operator, and one pack. Each answers a different business question.

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The idea

Market elasticity asks how total demand responds when market prices change. Operator elasticity asks how your own customers respond to your price relative to rivals. Pack elasticity includes switching between your own offers. Operator and pack demand can be more sensitive than total market demand, especially where substitutes are easy to use. These are typical patterns, not a fixed ranking: measure the level that matches the decision.

Use it thoughtfully

  • Name the level of every elasticity figure you quote.
  • Use operator and pack evidence for your own prices.
  • Expect higher sensitivity where customers carry two SIMs.

An example

ILLUSTRATIVE EXAMPLE: A study says national data demand barely reacts to price. The team still tests its own price rise in two regions first, because its dual-SIM customers can switch in seconds.

A question to try

Which level of elasticity did your last pricing paper quote, and was it the right one for the decision?

A useful framework is a starting point, not a guarantee. Effects vary with the audience, product and situation. Use truthful evidence, respect customer choice, and test the result.

Connect the ideas

Illustration

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