What does captive-product pricing require?

Captive-product pricing is a strategy that involves pricing a core product and then pricing associated products that are necessary to use the core product. This method is particularly common in industries where a primary product is sold at a low price, encouraging consumers to buy complementary goods at a higher margin. For example, a razor handle might be sold cheaply, but the blades, which are essential for its use, are sold at a higher price.

By requiring customers to purchase these essential complementary products, the company effectively ties them to its primary offering, maximizing overall revenue. This strategy creates a situation where the main product (the razor, in this case) is often seen as a 'must-need,' while the complementary products (the blades) drive additional profit. Therefore, the statement about pricing must-need products alongside the main product accurately captures the essence of captive-product pricing, as it highlights the importance of both the primary offering and the associated goods necessary for its functionality.