Sunday, February 17, 2008

The distribution of sales units by price point

Why is it that the sales volume in units for a given product category (of functionally homogenous products) follows this chart? Year after year, the sales curve remains the same, regardless of changes to product styling, color or packaging.

It seems that a disproportionate amount of attention is paid by product managers on the shaded area -- where effort is made to differentiate by adding cost. Are they responding to their own career interests, or the interests of the consumer base represented in the distribution of the chart?

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