At first glance I thought this was a perfect definition (following the CHARGE MORE motto from patio11). I realize now it's a perfect and easy definition BUT it

At first glance I thought this was a perfect definition (following the CHARGE MORE motto from patio11). I realize now it's a perfect and easy definition BUT it does not cover all scenarios. > price sensitive customers have the same demands as price insensitive customers No, that is not always true even though I feel is true for more than 50% of cases. Example: On an airplane customers in the first class are demanding larger seats and amenities than other in smaller classes. You are describing a specific scenario where all customers have the same cost per customer and so clearly serving the ones with higher margins is better. You are also describing a situation where customers have different feature requests and so the smallest pool of customers makes the feature set smaller and the product more specific and efficient. This is more generally true across most scenarios. In order to act on it as you said you should select higher paying customers. The problem is pre-pricing you don't know what each customer is willing to pay. So this is a good rule if you know a bit about the pricing offer but don't have complete dataset. Once you do have complete data though the perfect solution would be something resemblembing a first degree equation. Because clearly is better to make 1000$ x 100 customer than 2000$ from 5 customers. So it boils down NET_PROFIT X CUSTOMER for each possible group. Essentially there is not a generic solution of the argument QUALITY VS QUANTITY or MORE POOR CUSTOMERS VS LESS RICH CUSTOMERS. It depends on how poor is the poor and how many and how rich is the rich and in which quantities. It's a first degree equation, not a yes/no answer. To summarize CHARGE MORE offers tremendous value and insight for how compact a rule it is to memorize. There are specific scenarios where other strategies work better. Also the more people will apply blindly the CHARGE MORE the more that type of customers will be saturated with offers and serving other less paying customers will offer better opportunities for profit.