Most of the esoteric high-end Audio manufacturers sell relatively few units compared to the mass market brands, so in addition to amortizing the R&D costs over a much smaller run, the production costs of buying small lots of highly specialized parts that require the highest quality means that the production runs can be very expensive. Many times, the challenge is that the quality CMs that are most capable of making the product also have high MOQs.
Stratospheric audio gear prices
The more time I have under my belt pursuing quality audio, the more I realize that high audio gear prices have some basis in their quality. Yet there is a limit. When you buy a Ferrari the cost is high, but you can see the money involved in the design and parts. Many would argue that high quality audio gear is similar to the quality and design of a hyper-car. But when you look a the sheer quantity an complexity of this kind of car, there is no piece of audio gear that compares. To me, a piece of audio gear that costs as much as even an inexpensive car is just a manufacturer cashing in because they can. Can you imagine what audio manufacturers would want to charge for a piece of audio gear that was the size and weight of a car? Like $100 million. I believe it just drives the whole market up and we end up getting a little bit suckered. This is all perhaps a little overstated. I guess I just want to shame audio manufacturers. I do understand that they are not charities, or here for the betterment of mankind. If you are not frustrated by this, good for you. Here is a quote from a book about marketing. The reference is a victim of link rot. Nevertheless it has common information.
"Premium Pricing
Premium pricing is the practice of keeping the price of a product or service artificially high in order to encourage favorable perceptions among buyers, based solely on the price. The practice is intended to exploit the (not necessarily justifiable) tendency for buyers to assume that expensive items enjoy an exceptional reputation or represent exceptional quality and distinction . A premium pricing strategy involves setting the price of a product higher than similar products . This strategy is sometimes also called skim pricing because it is an attempt to "skim the cream" off the top of the market. It is used to maximize profit in areas where customers are happy to pay more, where there are no substitutes for the product, where there are barriers to entering the market, or when the seller cannot save on costs by producing at a high volume. It is also called image pricing or prestige pricing.
Luxury has a psychological association with price premium pricing. The implication for marketing is that consumers are willing to pay more for certain goods and not for others. To the marketer, it means creating a brand equity or value for which the consumer is willing to pay extra. Marketers view luxury as the main factor differentiating a brand in a product category."
Source: Boundless. “Market Share.” Boundless Business Boundless, 26 May. 2016. Retrieved 07 Feb. 2017 from https://www.boundless.com/business/textbooks/boundless-business-textbook/product-and-pricing-strateg...
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