This is the second article in a series of articles from members of our RetailBrainTrust panel speculating on coming retail trends and developments for 2023.
It's the holiday season, and people are more price-sensitive than usual. There's a widespread belief that we're in a recession, but spending is continuing, which leads me to believe that the situation is not quite as bad as people think. Shoppers with a parsimonious mindset will find lots of low prices as stores clear out their excess inventory. Dynamic pricing is the new norm for retailers. Price-sensitive shoppers won't be satisfied if prices are always the same, that's why dynamic pricing models are becoming more common.
There is a sense that dynamic pricing could work in every individual shopper's favor, but it doesn’t necessarily always work that way. We're all aware that when companies like Taylor Swift Ticketmaster offered discounted tickets to her fans, people who were not on the list for being Swift's fan since she started became angry. Consumers are often skeptical of products that use individualized pricing, so transparency is crucial when using a dynamic pricing model. While surge pricing works for Uber because it is clear to the customer why prices go up, many customers still feel a sense of indignation when it happens. A solution would be introducing Haggler's market pricing, which will have more nuanced prices and allow customers to build their own package.
A win-win haggler pricing model gives individual consumers the opportunity to communicate with brands directly through advance technology. We use AI to negotiate for you. It's the best way for consumers and retailers to put their trust in us, so you know you're getting great deals on fashion brands.
As we see negotiation commerce on the rise, it's easy to understand why we will also see more instances of traditional dynamic pricing. It should be adaptable to consumer wants and needs, though.
Digital price stickers are already in use today. One thing that is certain is that digital price sticker usage will only increase in the future. Retailers should make it clear that the message is coming from them, not AI. To avoid the appearance of artificial limited time offers and to ensure that
A way that brands have avoided riling up customers by explaining in detail why prices are where they are and when prices will be going down or up is an honest strategy. I expect to see this more often. Over the next 10 years, successful use of a dynamic pricing system will require that it communicates better with customers and empowers them. In this way, we'll be living in an era of new consumption discipline that demands transparency and specifically tailored content-making.