One more thought regarding the "appearance" angle. I had a client some years back whose only products were high-end writing pens. Their cheapest pen was $3,000, and their most expensive cost $85,000. I don't think the pens wrote any better than what you could buy at Office Depot for a fraction of that, but their main use was as jewelry for men. Think about it, jewelry serves no practical purpose other than appearance, yet people are willing to send thousands, tens of thousands or even millions on it.
In audio gear, there is always the sound quality issue, but it doesn't stand there by itself. Just as with jewelry, one can run up the price of a stereo component with what it takes to attain a certain appearance. And that is without even discussing how the price tag can also be arbitrarily inflated just because of the brand name.