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***
I believe
that for the short-term, dynamic pricing will be a driving force for a great deal
of activity. Some businesses will
be caught up in frenzy of price-cutting, providing both the B2B and consumer markets
with some terrific opportunities to pick up a few bargains.
Ultimately, however,
like the "gas
wars" earlier this century the trend will self-destruct--something has to
give, probably quality and service. In
the long-term, I foresee several events occurring: -
Businesses
who try to survive solely on competitive pricing will paint themselves into the
proverbial corner, and go broke; -
First consumers,
then businesses, will rebel against poor quality and service, opting to pay a
little more for some guarantee of a certain quality level. -
Unfortunately,
the overall quality level will probably drop in many industries--for example,
you can go into any McDonalds and get an "adequate" cheeseburger at
a competitive price, but you never get a really "good" cheeseburger
(imho). There are both opportunities and pitfalls
in competitive pricing. The challenge will be to make the most of the opportunities
without suffering the pitfalls.
(Judy Wogoman, Publisher, NetNuggetz Newsletter) ***
Dynamic pricing will effect all industries, but at different paces. When pricing
is not simple (adhering to KISS), there is a growing need to speed up the calculation
of the price. With technology based purchasing or sales systems, a fast price
is expected. Those industries that offer IT based sales (promo only) and purchasing
systems will have customers who expect fast responses from these systems. Other
industries whose customers have grown accustomed to fast and complete responses,
will also demand a quick response to pricing questions. If dynamic pricing is
a part of the equation, a fast response will be expected. I still believe, however,
that all customers prefer simplicity in pricing and will ultimately avoid dynamic
pricing models if they are complex.
(Veronica Williams, Founder, DiscoverIT) ***
Dynamic pricing will continue for high dollar volume, infrequent purchases. It
will not play a large part in low dollar, frequent purchases (unless its part
of a package such as paying $20 for 10 gallons of milk, each gallon retrieved
separately; even then this will have limited usage). Regarding
the future, dynamic pricing will have limited appeal.
Dynamic pricing for common, frequently purchased items is not practical.
(Ken Aust, Portland, Oregon, USA) ***
Dynamic pricing
will not expand into all industries. When a company sells services, dynamic pricing
is less interesting. In production companies, dynamic pricing is interesting for
selling old goods or surplus. Dynamic pricing
will not disappear. But not everything will be negotiable and dynamic.
(M.,
NETHERLANDS) ***
Dynamic pricing will expand to all
industries, this seems to be where the new economy is heading. I'm excited about
dynamic pricing, because this will help the economy as well as make consumers
happy since they might have a chance to spend less money to do more things.
(Lilian, Beijing) ***
The auction form of dynamic
pricing will proliferate; if a product can be commoditized, it will be. Small business will attack new markets as friction free
B2B transactions drive profit expectations. Automated "buying-agents"
will lock in lowest worldwide price. Prices fall inexorably, middle-men disappear,
suppliers' margins are cut to the bone. In response, suppliers move to one-on-one
pricing, offering ultra-high value products bundling unique information and interactive
services with physical goods. Niche markets proliferate, and spawn the likes of
haggleware.com - software that allows an on-line salesman to haggle with a buyer
over the price of an unique product.
(Jon Koerselman, Sioux Falls, South Dakota,
USA) Back
to the main ECMgt.com Page (http://ECMgt.com)
Back to this issue:
(http://ECMgt.com/Aug2000)
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