Price Point

[Roger Bell]

Can someone give me a definition of "price point". How does that differ from the "price" of a thing? Pls. contrast the two, explaining the differences.

When was this term coined..........or is it simply another facile and redundant addition to the media generated idiom?

[Jason Roehl]

It entails the concept of setting a price or price range for a product before it is manufactured or even designed, then in the design and manufacturing process, making sure that everything that goes into the product allows the manufacturer to maintain their profit margin.

Clear as mud?

[Jim Becker]

In nearly every market that supports multiple "levels" of a product or service as defined by things like quality, features, etc., there are certain price ranges that attract a certain population of buyers. That's commonly referred to as a price point or range.

For example, look at table saws:

Benchtop/portable: $200-500
Contractors' Style: $350-900
Cabinet Saws: $800-$3500 (more than one theoretical range in this one!)
Euro Sliding Saws: $3200-$12000+

Each of these ranges/price points attracts a certain type of buyer, through available budget and other factors such as, well...desire/need. Some vendors choose to compete in all these ranges (Grizzly is an example); some in a few (Delta, Jet, PM, etc) and some only in one (Mini Max, Felder, etc) and they market accordingly.