Dynamic Pricing—Prices in Motion

Continuing from last time, we introduce major trends from Dentsu Inc. Aegis Network Carat's "TOP 10 TRENDS" for 2016.

In retail and e-commerce, "dynamic pricing" – flexibly adjusting prices based on factors like supply and demand – is gaining attention. Platforms like physical stores and e-commerce sites are already emerging that track competitors' prices in real time and immediately reflect this information in their own pricing.

In stores, it's now possible to "match" the optimal price at checkout or let customers choose which items to put on sale. Online, extensive data is available—shoppers' purchase histories, location information, operating systems used—and this data is leveraged for pricing and promotions.

Uber raises its set prices to attract more drivers onto the streets, but passengers tend to hold back on using the service. Prices change constantly to match supply and demand. Airlines have traditionally varied prices based on various factors, but recently Iberia Airlines has been experimenting with auctioning airline tickets.

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Advertisers should recognize that dynamic pricing is becoming a reality and consider how they can apply it to their own strategies.

To incorporate dynamic pricing into business, companies must measure customer data and external factors affecting their operations. They also need systems capable of flexibly reflecting prices across both e-commerce and physical stores. Furthermore, mobile systems are essential to display real-time price fluctuations and drive foot traffic.