We all like to feel that we get bargains when shopping. But that’s not always the case. See More Gamesmanship on Retail Prices — Even Online. And When Is a “Sale” a Sale? Today, we look at do shoppers like dynamic pricing — or not?
First, let’s define dynamic pricing. According to Luke Metcalfe, writing for Crealytics:
“Dynamic pricing, an E-commerce strategy, applies variable pricing instead of fixed pricing. As more data are analyzed, optimal prices for items are calculated. The time between price changes depends upon the business and item. But it can be as often as every day or even every hour. Dynamic pricing has become critical in E-commerce because of automation. In a store, employees would have to physically create new pricing display information. Yet, the online the price of an item can be dynamically adjusted without much cost to the business.”
Do Shoppers Like Dynamic Pricing?
“For retailers, top pricing pressures involve keeping up with competition and reducing markdowns to be profitable. More niche — but also important — are issues around dynamic pricing. The practice of lowering or raising prices on the fly. According to an April 2018 survey by Forrester Consulting and Revionics, a majority of consumers worldwide (62%) are OK with fluctuating prices. But, prices must seem fair and not arrived at in an arbitrary way.”
“Dynamic pricing is common practice online, but found less frequently in stores. Not all retailers have the means to implement electronic shelf displays. In a November 2017 survey of retailers worldwide by Planet Retail, 40% were either currently using electronic shelf labels to show prices, promotions, and detailed product info, or planned to use them in the next 12 months. Some 78% of retailers would like to implement more price changes and promotions to provide better prices and deals in-store, Planet Retail found, but 65% don’t feel able to execute all of the pricing changes and promotions they’d like to. Concerns about consumer acceptance have been a hindrance, in addition to technological issues.”