These days, prices on everything from baseball tickets to power tools can change by the hour.
You can thank dynamic pricing, the system that has long guided pricing in airline tickets and hotel rooms and is now touching more areas of consumer life.
“You can do so much more of this with the computing ability that’s available,” said John Simpson, director of Consumer Watchdog’s privacy project. “It’s just a way for maximizing the profits a company can suck up without giving the consumer any adequate way to understand the issue.”
• The Detroit Tigers are expected to bring in an extra $1 million this baseball season after switching to a dynamic pricing system for tickets,according to Crain’s Detroit Business
. An outfield seat that costs $12 in March could run as much as $20 by the end of the season if the team’s on a hot streak and fans are clamoring for seats.
• The producers of “The Lion King” on Broadway have been able to make a 16-year-old show the top grossing play in New York City by continually tweaking the ticket prices,The New York Times reported
. Like airplane tickets, show prices shoot higher on traditional peak days such as Christmas.
• And online retailer Amazonhas also been known to change prices
on consumer goods multiple times per day. The prices reflect what competitors are charging and seasonal trends, The Wall Street Journal said.
Simpson said consumers don’t tend to mind dynamic pricing that’s transparent, or that benefits them. A mid-week tourist getting a good deal on a “Lion King” show will be happy about the system.
But people who find prices have changed on items in their online shopping cart within days may have cause for frustration.
“It might not be so bad if we all understood how it works,” Simpson said. “At a minimum we need to understand what’s happening.”