Dynamic pricing

Earn more with dynamic prices

Competition on the e-commerce market is growing. According to admonkey.pl, almost 12,000 new e-shops were registered in Poland in 2020. Due to the increase in the number of online sellers, the number of people using price comparison services has also increased. Customers are increasingly changing their shopping habits and moving away from buying products only in the so-called trusted shop, choosing the cheapest option. This mainly applies to online shops, where, thanks to price comparison services, the comparison of offers is quick and almost automatic. The time it takes you to adjust your offer to competitive offers will have a huge impact on your profits.

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Dynamic pricing

The dynamic pricing strategy is based on automatic analysis of competitor data, which has a real impact on price. The automated data analysis allows the price to be matched to current prices in competing shops. This analysis consists of data such as seasonality, demand, the effects of a marketing action, or price reductions for a similar product in a competing shop. Dynamic price calculation is therefore a process that automatically determines the product price on the basis of the data flowing into the system. As a result, you do not need to set a fixed price for the product you are selling and constantly analyse your competitors' price lists, as the dynamic pricing function will do this for you.

You may have encountered dynamic pricing when buying airline or bus tickets, for example.
Example: You will pay 49 PLN for a flight from Gdańsk to Warsaw on Monday at 9 a.m. by airline X, but a similar flight on Friday will cost 129 PLN.

In e-commerce (e-commerce), by definition, prices should be adapted to the current market situation. Constant changes that force dynamic price list adjustments, if not implemented by using an automated pricing strategy, are extremely time-consuming and risky. You can spend the time you save developing your brand, and excluding the risk of human error will reduce the stress of running your business.

standard price
competitive prices in the market
dynamic pricing adapted to the market

Traditional versus modern pricing model

The traditional model can be observed in stationary shops. Product prices rarely change during the shop's working hours, and a change in the price list is often triggered only by the imposition of a promotion on a specific product. Retailers who do not use dynamic pricing have to spend time on a daily basis analysing the competition and the changes they can make to the price list. In the traditional model, the introduction of new prices requires editing each item that is on the shop's offer. By automating the prices, the same retailer can set the mark-up per product category and margin, and the function used will itself perform the analysis and make the price changes.

As technology advances, the traditional pricing model is increasingly being replaced by modern, automated pricing. This mainly applies to online industries, where the high competitiveness does not allow to manually follow market changes and adjust the offer.

How to implement dynamic pricing?

Contact us! We are an experienced team that will show you how you can adjust your prices to the current market situation, without having to watch your competitors. We will show you how to take full advantage of automated pricing, and give you tips on how to construct the best pricing strategies. Together we will determine which expenses you can optimise to achieve the best results!

„By automating activities within a company, we grow faster. Companies where automation is not pursued will always struggle to keep up with industry leaders. The question is whether any company today can afford not to automate.

Paweł Grzesiak

Owner of dP Internet and author of many industry publications

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