Volume vs. Premium

When you are out to sell anything, an important decision you make is to either make something for the mass market, keep margins low and make it up by selling large volume or make something too good for a niche market not to not have it and charge a premium. There’s no wrong way to do it and the decision is more often dependent on the industry and competitive landscape to position the product right and gain competitive edge.

But then every once in a while there comes along a company (read Apple or Nike) with a premium on their products and attract a mass audience to sell huge volume. But history will confirm that at beginning of their sales process, they made the same decision of choosing between volume and premium. Eventually they made great products, had outstanding marketing and a well oiled supply chain and sales machinery to hit the bull’s eye of selling high volume at premium price.

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