Originally Posted by jayeff

Okay so this is a marketing thread not an economics class and I'm sure you realize that price spreads are almost always pyramidal as a reflection of market demands. And since selling price is only one component of running a successful business, a seller can aim at whatever price level suits him.

That said, most sellers end up aiming for average prices because in the long term it is much harder to operate at either extreme. You have to run a business far more tightly if you sell on low price and you are always vulnerable to anyone with deeper pockets who wants to buy market share. Price yourself at the top end and your buyers are likely to be far more fickle, since their perception of value usually includes many more intangibles than concern customers for mid-range products and services.