Quote:
Originally Posted by SamuraiXSendai
You are right -, they should price it at the highest point it will sell for - if they calculate people will still buy it at $489 it should stay there - no reason to price it below what people will pay for it - that would not make sense.
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This thinking does not incorporate volume. It is far more profitable to sell 10000 units with $20 in margin than 1000 units with $100 in margin. Also, you dramatically drive down the cost of production per unit when you sell 10x the volume, take 10x the market share, up word of mouth by 10x and have 10x the negotiation power with publishers.