The greater the demand relative to supply for a product, the higher the price shoppers will support. Supply and demand fluctuate, so it is necessary to be prepared to adjust pricing as necessary to keep up with changes in the market.
With millions of merchants competing in the same marketplace, it's rare when someone is offering a product that no one else is. All other factors being equal, shoppers will invariably choose the seller with the lowest price. Understanding the selection, pricing strategy and level of establishment of competitors with similar goods is useful when determining pricing.
Competition comes in the form of other merchants on the same sales channel as well as other sales channels.