How retailers are using dynamic pricing based on consumer behavior
Summary
Retailers are using dynamic pricing, which means they change prices in real time based on factors like demand, stock, and customer behavior. A CBS investigation found prices on websites like Old Navy, Target, and Amazon changed frequently, sometimes daily, making it tricky for shoppers to find the best deals.Key Facts
- Dynamic pricing adjusts prices based on supply, demand, and how customers shop.
- Prices can change daily or even multiple times a day online.
- Retailers may use data such as shopping habits, gender, time of day, and device type to set prices.
- Old Navy showed price swings up to about 36% in a month on the same shopping cart.
- Target prices varied by more than 20% over two weeks for six items.
- Amazon’s price changes were smaller and the company says it does not use consumer behavior to set prices.
- Online price changes are faster and more frequent than in physical stores, which update prices less often.
- Consumers find it hard to know when they are getting a good deal because prices change so often.
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