Prices will be Dynamic, wether you like it or not !
Monday, September 15th, 2008As shown is the airline, hotels or car rental industry, there is just too much money to be made from Dynamic Pricing for businesses to ignore it.
You may think it’s valuable in those industries because they all have a ‘no value’ inventory. After all, an empty seat when the plane has taken off is worth the same than a decommissioned Russian nuclear submarine: nothing but embarrassment.
But whatever the consumer product, there will always be a point in time when its value will become $0, nada, nothing. As it’s better to sell it as far away as possible from that unfortunate event, Retails do ‘Sales’; services do ‘promotions’.
Pricing dynamically will become feasible, because the cost of changing price is going down…. LCD price tags with over-the-air update begin to proliferate; they’ll make price changes instantaneous and virtually free!

Second, I think psychologically, consumers would rather like true fixed prices, but cannot afford it, because it means way too inefficient markets. Slowly, the ever-changing price of Gas, the ‘Peak pricing’ of road tolls and utility make people more confortable with the value being determined in realtime.
Not to be omitted, the success of eBay and other classifieds has indirectly popularized Dynamic Pricing. As phpauctions puts it: “While not yet fully realized, online auctions have the potential to revolutionize pricing by replacing sticker (or fixed) prices, with a dynamic pricing model whereby merchandise is priced according to what the market will bear”


