How do you set your prices?

When setting your prices, what do you think about first? What you're selling or who you're selling to? Quite often, it’s more important to think about who you're selling to than what you're selling. At one time a cup of coffee was a cup of coffee. Today, that cup of coffee comes with a whole language of its own and choices broader than Charlton Heston’s shoulders! Starbucks doesn’t just sell coffee; they sell community, status, and experience. We pay dearly for that experience - what we pay for goes way beyond the 2 centimes worth of coffee they serve us. This is a great example of how price no longer directly relates to product. It's quite a tough one, but applying this logic to your products or services, you can not only drastically improve your bottom line, you'll have loads more success appealing to the top end of your market. Maybe it's time to review your pricing policy?