Dynamic Pricing Your Customers Will Love

Retailers know dynamic pricing is a great way to maximize revenue at the individual transaction level – but how do you keep customers happy, knowing someone else could have got a better price?

Over on the Intelligently blog, there’s a great rundown on dynamic pricing strategies and tips to help avoid the backlash – and shouts of price discrimination – from media and shoppers.  They talk about four core aspects for dynamic pricing:

  1. Price Differentiation – Two prices are better than one
  2. Ensure you’re using a proper value metric
  3. Utilize Time in an auction type model
  4. Couponing and Discounts

While these can be effective strategies, what is missing from the mix is Incented Dynamic Pricing – engaging your shoppers on personal value, and creating a environment where those who pay more, get more. It’s establishing a value direct to give shoppers a reason to tell retailers what they are, personally, willing to pay for a product, using product discovery to dynamically bundle an item,  based on willingness-to-pay. When you can engage with a shopper on price at this personal level, you lose the negative impact dynamic pricing might otherwise have – it’s completely unbiased, and a killer component to a loyalty program.

Do your organization use dynamic pricing? Have you heard of incented dynamic pricing?

Joe Shartzer

Cofounder at Nyopoly
Joe Shartzer is a co-founder of Nyopoly and loves startups, stats, sports, and alliterations. And bourbon.
Say hi: joe@nyopoly.com.

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