Choices and Affordability
Let’s go back and think for a moment about the Model-T Ford. The breakthrough was that mass production made the automobile affordable. However, the choices were limited. The mantra was that “you can have it in any color, as long as it’s black."
At that time, the big breakthrough was in affordability. Since then, mass production has evolved to enable a large number of colors and many other features to provide choice, albeit still within the range of affordability.
Indeed, providing more choices has also enabled producers to stratify the market in terms of price, enabling companies to charge more for certain features because customers for those features are willing to pay more for them. This is why you so often see offers for similar products at Silver, Gold and Platinum levels.
The driving factor is that you can segment markets nearly infinitely. Based on the 80:20 rule, or Pareto principle, 20 percent of the customers will buy 80 percent of the product. In addition, 20 percent of the customers will be willing to pay a premium price for some additional features.