Captive pricing entails gaining a commitment from a customer to a basic product or system that requires continual purchase of peripherals to operate.

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Captive pricing is a pricing strategy where a basic product or system is sold at a low price, but the customer is required to continually purchase accompanying peripherals or complementary products over time to sustain it. This creates a captive customer base, where customers must continuously buy from the same company to maintain their existing equipment or system.

Captive Pricing Entails Gaining a Commitment from a Customer to a Basic