Tiered pricing allows consumers to...

Tiered pricing structures are designed to provide consumers with various options based on different levels of product or service features, thereby allowing them to choose according to their needs and budget. This pricing strategy typically offers a basic product or service at a lower price, while more advanced options with additional features come at higher price points. This way, consumers can select models that best fit their requirements, enhancing their satisfaction and potentially maximizing the company's revenue by capturing various market segments.

For instance, in a software application, a basic version may be offered for free or at a low cost, while premium versions featuring extra capabilities—such as advanced functionalities or customer support—are available at a higher price. By enabling customers to opt for upgraded versions, tiered pricing effectively caters to different consumer preferences and willingness to pay.