Price Bracketing

The psychological effect in which presenting a high‑priced option alongside a mid‑priced option makes the mid‑priced option appear more affordable. The high price expands the customer’s range of acceptable spending, and the mid price, by comparison, looks like a reasonable compromise. Price bracketing is a core mechanism of the three‑tier price ladder. The top tier’s function is often not to sell in volume but to serve as a bracket that makes the target middle tier look like better value.

Example: A laptop manufacturer offers a high‑end configuration with a premium display and dedicated graphics; most customers buy the mid‑tier model, which now seems sensibly priced next to the expensive option.