When you’re setting a price, you’re sending a signal. If your competitor’s software ranges in price from about $100 to about $500, and you decide, heck, my product is about in the middle of the road, so I’ll sell it for $300, well, what message do you think you’re sending to your customers? You’re telling them that you think your software is “eh.” I have a better idea: charge $1350. Now your customers will think, “oh, man, that stuff has to be the cat’s whiskers since they’re charging mad coin for it!”
And then they won’t buy it because the limit on the corporate AMEX is $500.
Misery.
| Author | Joel Spolsky |
| Work | Camels and Rubber Duckies |