7 On Your Side: Dynamic pricing coming to stores
It's no secret that the online price of an airline ticket can change in a second. It's called dynamic pricing.
And now it's common practice for prices on all kinds of goods to change online throughout the day. And it may soon happen in stores.
The reality for shoppers is those online price changes might not be staying online for long.
Mike Fridgen, CEO of decide.com, says 20 percent of the products his site tracks change daily.
"The way to drive sales is with the lowest price, so intra-day they are competing for more sales on the shopping engines," Fridgen says.
Eric Best's company makes software that changes prices for retailers to keep their price the best on the web.
"Generally our customers are looking to us to re-price products on an hourly basis, which is about 24 times faster than we were doing it a year ago," Best says.
Traditional brick-and-mortar stores have used dynamic pricing during the holidays. And stores like Kohl's use digital price signs allowing the cost of an item to change on demand.
Best says it's the future. Not only at the mall, but perhaps even at the grocery store.
"I think we are going to see digital signage and rapidly changing prices," Best says.
That's kind of the evil, if you will, of having electronic price signs, just with a few key strokes of a computer the price could change.
Edgar Dworsky is a former assistant Massachusetts attorney general specializing in consumer protection.
"That's kind of the evil, if you will, of having electronic price signs, just with a few key strokes of a computer the price could change," Dworsky says. "Let's say a storm was coming, with just a few keystrokes they could raise the price of milk, water and batteries and that would be unfair in that context. I hope that doesn't happen."
Shoppers like Herndon resident Bob May also aren't sure they're onboard.
"You'd have to wait until you got to the store to know what the price would be, and that's not how I shop, I look before I go," May says.
Consumer advocates don't think consumers would stand for a situation where you have to routinely rush to the checkout stand to beat the price of your milk changing, but expect over time to see broader use of electronic price signs making it easier for stores to adjust their pricing.