Was it?
According to the article "A Businesweek article cited sales of 215,000 units and said it was 1995’s best-selling PC laptop." As the article says, $3,799–$5,649 was "not cheap, but not absurd at the time."
For reference the PowerBook 500 series sold "almost 600,000" units in 1994-1996 according to Wikipedia and the color screen models were $2,900-$4,840.
Moore's Law was in full effect too, everything was going obsolete as quick as time itself. Specifications values inflated in orders of 10^2 units per week, whether it was megahertz or megapixel or megabytes or grams. Making last year's new product, even with parts upgrades, was waste of time.
Although primitive by today's standards, it was a solid little laptop that served me well for the tasks I was engaged in at the time … writing, Web surfing (on a very slow modem), learning HTML, and playing Doom.
It had a color screen, a big improvement over the greyscale screen I had on my previous laptop (no name Taiwanese brand that cost $2000 new!)
The 701 also easily fit in a book bag, although it was a bit thick and heavy.
There are some more photos and historical information about the 701 here:
WillAdams•4h ago
_Thinkpad: A Different Shade of Blue_ by Deborah A. Dell and J. Gerry Purdy
https://www.goodreads.com/book/show/483933.ThinkPad