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How Online Shopping Makes Suckers of Us All (theatlantic.com)
Thelasko shares an excerpt from a report via The Atlantic, which describes how price discrimination is used in online shopping and how businesses like Amazon try to extract consumer surplus: Will you pay more for those shoes before 7 p.m.? Would the price tag be different if you lived in the suburbs? Standard prices and simple discounts are giving way to far more exotic strategies, designed to extract every last dollar from the consumer. We live in the age of the variable airfare, the surge-priced ride, the pay-what-you-want Radiohead album, and other novel price developments. But what was this? Some weird computer glitch? More like a deliberate glitch, it seems. "It's most likely a strategy to get more data and test the right price," Guru Hariharan explained, after I had sketched the pattern on a whiteboard. The right price -- the one that will extract the most profit from consumers' wallets -- has become the fixation of a large and growing number of quantitative types, many of them economists who have left academia for Silicon Valley. It's also the preoccupation of Boomerang Commerce, a five-year-old start-up founded by Hariharan, an Amazon alum. He says these sorts of price experiments have become a routine part of finding that right price -- and refinding it, because the right price can change by the day or even by the hour. (Amazon says its price changes are not attempts to gather data on customers' spending habits, but rather to give shoppers the lowest price out there.)
Because I hate to tell you, but stores in Beverly Hills charge more than they do in Compton for the exact same product.
And their are these things called "sales" and "coupons" to differentiate pricing even at the same store.
Yes, online makes it a bit more obvious, and yes, smart people can kill the cookies that are more likely to raise your price than reduce it (they assume no cookie = new customer, so they offer lower prices).
Study should be redone, comparing price differential online with those off-line.
excitingthingstodo.blogspot.com
It is sort-of new, depending on your time frame. A 10% profit used to be the respectable and moral price. Now it's a numbers game and the well being of the customer doesn't even enter the picture. Go read the stories from sales, marketing, and product engineers from some of the large companies. They do whatever it takes to gain a few percentage points as it's all gamified. The fact that some of their pre-packaged meals are known to have effectively no nutrients is just a way to keep costs down. They're not feeding it to their kids so no worries.
One of the current business fads is to push for the no. Meaning continually up-selling until the target gives you a firm no. Basically its a strategy to pray on the people pleaser segment of the population as they have trouble saying no to people. The last sale guy I talked to got upset that he spent XX minutes talking to me and I didn't buy anything thus he his wasted time. He tried to make me feel bad for not doing whatever the cold caller asked for. Sales people and the management above them are all scum.
Much of the world still considers haggling over price a shopping standard. From open air butchers auctioning off product, to roadside vendors dickering over price. If you pay asking price you are very likely over-paying.
errr....umm...*whooosh* *whoosh* Is this thing on ?
This. Also, standardized pricing is a relatively new phenomenon as far as global history is concerned and even today is mostly true of mass market items only. If you live(d) in a bartering society merchants would absolutely sell you the same thing at different prices different times of the day, etc. Furthermore, in any sort of person to person transaction you are sized up as to what you will pay and that (or a bit more) is probably the price at which it's offered. In dealing with a lot of sales of professional specialized items to small businesses, sole proprietors, non-profits, etc. really anything where you get a "quote" first the price might vary depending on what your ability to pay is.
This type of "big-data pricing" might be doing these things on a larger scale, and it's probably too early say definitively whether this is good or bad for the average consumer (on average it may actually be the same as the current average sales price of a given product), but it's not fundamentally new.
That I only ever browse Amazon anymore to browse and then go get the same thing on eBay or locally only cheaper and with much faster shipping.
New movies... Well lets see $20 on Amazon assuming they will even sell it to you without prime... $7 for same thing on eBay.
I think it will be a very long time before machine learning algorithms are able to deal with conflicting information or do anything other than seek locally optimal solutions.
This is a variation of the same old story where stores use "big data" to only stock shelves with what has been shown to make the most money only for customers to get annoyed they don't have everything on their list and shop elsewhere.
When enough people get annoyed at the games enough to modify their behavior and go elsewhere as I have done all their super fancy algorithms and or cheap genetic A/B schemes still won't have a clue on earth why.
Unfortunately groceries kind of suck online in the UK.
Seriously? Between the major supermarket chains and Ocado all providing online order / home delivery, none of them works for you? I'll admit, I gave up on Tesco repeatedly sending me things that were one day away from their use-by date, but there's a reasonable amount of competition.
I am TheRaven on Soylent News
If you're reasonably intelligent, you can use the same type of mindset in reverse for your own personal benefit. This is all part of Game Theory. You either learn how to play the game or the game plays you. The option that's not on the table is to end the game or exchange it with a more reasonable game. Such is life.
We'll make great pets
When you give up your right to check the Internet to find out what their competitors are shopping then I'll agree we should fight their ability to investigate you when setting pricing.
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke