By this logic they should increase their prices to $1,000,000/mo. They are not a charity, right? Why would they sell it for a measly $10?
The point is, pricing is adjusted to maximise profitability. If lowering the price for a specific market increases your profitability, you would go for it. There is a sweet spot, but it is not the same for every customer. You need segmentation to fully utilise the potential.
By this logic they should increase their prices to $1,000,000/mo. They are not a charity, right? Why would they sell it for a measly $10?
The point is, pricing is adjusted to maximise profitability. If lowering the price for a specific market increases your profitability, you would go for it. There is a sweet spot, but it is not the same for every customer. You need segmentation to fully utilise the potential.