Basically the list price is the starting point for negotiation on the sale price, which is then negotiated up rather than down. It is contrary to the usual custom of setting a list price, listening to offers and then negotiating to a sale price somewhere between the list price and offer price.
Another way to look at VIP pricing is that the seller is telling you what price he/she will accept (their bottom line price), something you don't usually know when negotiating the purchase of a house.
As stated in the previous answer, VIP pricing is a technique to attract buyers to put an offer in on a property while at the same time pacifies a seller who may be reluctant to put their home on the market for a particular price because they don't want to take less than a specific figure. The name itself is not a commonly recognized method as an Escalation Clause for example. I must caution you on this for the Buffalo area especially. The published asking price may NOT be what the seller will accept as a sale price. There are very few markets in the US that are using this kind of marketing technique right now because the sellers do not want to discourage a buyer from making an offer limiting the offer amount.
MJ Peterson Real Estate