We were looking to go away, and I was pricing the airfare for the two of us. I punched around a bit looking at different routings and timings, and found something that made sense for about $570. I jotted down the details and moved onto something else, making a mental note to discuss it over dinner. In talking it over we agreed it made sense and that we should go ahead with the purchase. When I finally got back to my computer the next day and had a few minutes to follow up, I entered our preferences once again. Same routing, same timing, same airline, same class of service. No difference, except now the ticket cost $1070.
They call that "dynamic pricing." It's when you are charged for an item or service based on demand, timing and other factors. And indeed one of the best examples is airline seats, where virtually every person on a given flight is paying a different amount. But now it seems as if every single item you buy is priced within a window which runs from 20% below the cost of the raw materials, up to a markup of 300% over that baseline. It's left to you to bring down the gavel on the number that makes the most sense for your wallet.
It used to be just antiques and artwork got this treatment. Sure, there might be variations by geography, but pricing was fairly standardized, set by the maker or supplier (the famous "MSRP" or manufacturer's suggested retail price), and then tweaked by the seller as they wished. So a coat was more or less the same everywhere: maybe $100 at Macy's, $104 at Bloomingdale's and $98 at Sears. Sure, a sale at any individual outlet might affect the final tally, but it usually wasn't worth the gas it would take to drive around try to save the five bucks.
But then Amazon and Google made it possible to compare prices with click of a mouse. And if retailing's head wasn't already spinning, now it simply blew up. There was no way to compete on price when your competition was everyone everywhere in every possible configuration. So merchants adapted to fight fire with fire. Now even the same outlet has different prices depending on whether you get in in the store, purchase it online, or buy it online and have it sent to the store for pickup.
They also use that same adaptability to tilt the equation in their favor when they can. Take that airline seat. Perhaps in the day between my initial inquiry and the time I went back to purchase the ticket planeloads of people decided they had to fly the same route and timing. And so the price of the available seats, as a simple matter of supply and demand, jumped up. Possible? Sure. Likely? Not so much.
More likely is that they noted my interest (with the ubiquitous computer "cookie") and adjusted on the fly. I didn't buy the first time, but came back and looked at the same thing a second. Hence, I must be seriously interested, so why not jack up the price? Almost doubling the bottom line is an extreme example, but you see the same routine in smaller amounts when looking at pants, toothpaste and computers. And often, just because it's the path of least resistance, you click "buy."
But not this time. On a hunch, I went into my browsing history and deleted my most recent efforts, making sure it covered the time when I did my initial inquiry. Then I went back and started again. Sure, I had to log in as if I was a new customer, but that was the point. And sure enough, up popped the original price I was offered, as if I was there for the first time. Had those same planeloads of people suddenly decided they didn't need to fly on the day I was going and cancel their reservations? Again, possible. Again, not likely.
Like "Cheers," sometimes it's nice to have a place that knows your name. But when that means they charge you more, maybe it's better to pull the ballcap down low over your eyes and pretend to be a newcomer. After all, on the internet no one knows if you're a dog. Or a frequent flyer.
-END-
Marc Wollin of Bedford like to beat the system at least sometimes. His column appears regularly in The Record-Review, The Scarsdale Inquirer and online at http://www.glancingaskance.blogspot.com/, as well as via Facebook, LinkedIn and Twitter.
They call that "dynamic pricing." It's when you are charged for an item or service based on demand, timing and other factors. And indeed one of the best examples is airline seats, where virtually every person on a given flight is paying a different amount. But now it seems as if every single item you buy is priced within a window which runs from 20% below the cost of the raw materials, up to a markup of 300% over that baseline. It's left to you to bring down the gavel on the number that makes the most sense for your wallet.
It used to be just antiques and artwork got this treatment. Sure, there might be variations by geography, but pricing was fairly standardized, set by the maker or supplier (the famous "MSRP" or manufacturer's suggested retail price), and then tweaked by the seller as they wished. So a coat was more or less the same everywhere: maybe $100 at Macy's, $104 at Bloomingdale's and $98 at Sears. Sure, a sale at any individual outlet might affect the final tally, but it usually wasn't worth the gas it would take to drive around try to save the five bucks.
But then Amazon and Google made it possible to compare prices with click of a mouse. And if retailing's head wasn't already spinning, now it simply blew up. There was no way to compete on price when your competition was everyone everywhere in every possible configuration. So merchants adapted to fight fire with fire. Now even the same outlet has different prices depending on whether you get in in the store, purchase it online, or buy it online and have it sent to the store for pickup.
They also use that same adaptability to tilt the equation in their favor when they can. Take that airline seat. Perhaps in the day between my initial inquiry and the time I went back to purchase the ticket planeloads of people decided they had to fly the same route and timing. And so the price of the available seats, as a simple matter of supply and demand, jumped up. Possible? Sure. Likely? Not so much.
More likely is that they noted my interest (with the ubiquitous computer "cookie") and adjusted on the fly. I didn't buy the first time, but came back and looked at the same thing a second. Hence, I must be seriously interested, so why not jack up the price? Almost doubling the bottom line is an extreme example, but you see the same routine in smaller amounts when looking at pants, toothpaste and computers. And often, just because it's the path of least resistance, you click "buy."
But not this time. On a hunch, I went into my browsing history and deleted my most recent efforts, making sure it covered the time when I did my initial inquiry. Then I went back and started again. Sure, I had to log in as if I was a new customer, but that was the point. And sure enough, up popped the original price I was offered, as if I was there for the first time. Had those same planeloads of people suddenly decided they didn't need to fly on the day I was going and cancel their reservations? Again, possible. Again, not likely.
Like "Cheers," sometimes it's nice to have a place that knows your name. But when that means they charge you more, maybe it's better to pull the ballcap down low over your eyes and pretend to be a newcomer. After all, on the internet no one knows if you're a dog. Or a frequent flyer.
-END-
Marc Wollin of Bedford like to beat the system at least sometimes. His column appears regularly in The Record-Review, The Scarsdale Inquirer and online at http://www.glancingaskance.blogspot.com/, as well as via Facebook, LinkedIn and Twitter.
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