A(n) <u> high pricing </u>strategy is appealing because it attracts two distinct market segments: those who are not priced sensitive along with more price-sensitive customers.
Price sensitivity can be broadly defined as the degree to which demand changes when the price of a product or service changes.
The price sensitivity of a product depends on how important the price is to consumers compared to other purchasing criteria. Some people value quality over price, making them less sensitive to price. For example, customers looking for high-end products are usually less price-sensitive than bargain hunters. So you are willing to pay more for high-quality products.
In contrast, more budget-conscious people may be willing to compromise on quality. These people don't spend much on things like brand names, even if they are of higher quality than common home-branded products.
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