I don't think it's that people don't understand the time, effort, and costs that go into making a cake.
Just that it's a lot of money for a cake, when most people aren't arsed about having bespoke cakes for special occasions, and most people are quite happy with supermarket ones, as it's a very small part of a birthday celebration. To people who place more importance on having a very nice cake for a celebration, they're the type of people who will pay those prices.
We're in a cost-of-living crisis. Bespoke cakes are a luxury item. That's really all there is to it. I'd be livid if my partner spend over £50 for a cake for me, because he knows I'm happy with supermarket ones and I wouldn't properly appreciate a bespoke cake.
I do know how long it takes to make a bespoke, nice cake. I've made rather intricate cakes before, and it's exhausting. Have to say though, at no point has it taken me 11 hours, even when I handmade different edible animals and painted them with the dye etc. And I'm not an experienced cake maker, I just do it now and again. So I really think you need to look at streamlining your time and costs wherever possible. I can understand it taking an hour to wash up, sanitize properly etc (it's more stringent for businesses than just making them at home now and again).
However, I'm genuinely seriously struggling to see how mixing any cake batter takes an hour, on a cake of this size. It's not about 'not throwing it together' because it won't come with the right texture, an hour is too long imo. Takes me far less time to hand-whisk perfect meringues. But I only do it as a slight hobby, not a business.
In any case. It's a niche business. Those who want very fancy, bespoke cakes will pay the going rate, those who don't, won't. IF I really wanted a bespoke cake, and had the money/was willing to pay a decent amount of money for it, I'm sorry to say I wouldn't pay the £70 you quoted with that lettering and no edible icing though, unfortunately. It's a nice cake, very neatly done with the icing, but isn't it a difficult one.