Shop Smart and Avoid Dynamic Pricing
Shop Smart and Avoid Dynamic Pricing
11 August 2022
laptop and phone with ecommerce app

How to Shop Smart and Avoid Dynamic Pricing Tricks

Dynamic pricing is a business strategy that uses adjustable prices (which can swing quickly and often) instead of fixed costs on products and services. So, what does that have to do with you? If you have ever shopped online or tried to book a flight using your smartphones, chances are you’ve experienced dynamic pricing. Let’s take a closer look at dynamic pricing and how you can regain the upper hand. 

What is Dynamic Pricing?

Dynamic pricing, also referred to as location-based, surge-, demand-, and time-pricing, is a technique companies use to change the price of something based on different factors. What are those factors? Competition, supply and demand (basically how popular something is), consumers’ willingness to pay (perceived value of an item), customer demographics and data can all affect how much you pay at the register. In essence, the core concept of dynamic pricing is to sell an item/service at different prices to different people.

A perfect example of dynamic pricing that happened during the 2020 COVID pandemic are toilet paper and hand sanitizer — everyday items that began to fluctuate drastically because of panic buying. 

Here are some of the ways companies use dynamic pricing for online shopping:

  • Adjust prices to match or beat competitors: Amazon and Walmart are good at this. They often have identical prices on popular items or underprice each other by a penny or two.
  • Adjust prices based on the day or time of day: Online shopping peaks during weekends and evenings, when prices rise.
  • Adjust prices based on web traffic for online stores: The more online shoppers view an item, the more people show interest in a product, the greater chance the price will increase.

What Companies Use Dynamic Pricing Most Often?

While dynamic pricing doesn’t work for every item like apparel basics, including underwear and T-shirts, it is very effective for others. It makes companies a ton of money from unwitting customers. Industries most notable for dynamic pricing include:

  • Travel (Airbnb, airline industry)
  • Hospitality
  • E-commerce (Amazon)
  • Utilities (electricity, water)
  • Retail
  • Entertainment (sports and event ticketing)
  • Transportation (Uber, Lyft)

Is it fair? Debating the fairness of dynamic pricing is a muddy area. From a business standpoint, dynamic pricing is a valuable tool for increasing profits and growth without much effort besides messing around with algorithms used to generate pricing. From a consumer’s perspective, the answer most likely would be no, dynamic pricing isn’t fair; it’s discriminatory. However, if you’re a consumer paying the lower prices, you may think dynamic pricing is the greatest thing since sliced bread.  

Advantages and Disadvantages of Dynamic Pricing

Unfortunately, the benefits of dynamic pricing tend to favor businesses. Dynamic pricing can help companies boost sales, stay on top of their competitors, and efficiently manage their inventories. It’s not all roses for companies that use dynamic pricing. Dynamic pricing increases competition, leads to price wars and lost sales, and can reduce customer loyalty and alienate some shoppers. 

Disadvantages tend to “favor” consumers; you pay more. Savvy shoppers can outsmart dynamic pricing. Read on to learn how.

How Can You Beat Dynamic Pricing?

If you have seen a price change while shopping online, you may have witnessed a type of automated dynamic pricing that happens when sellers use technology to “gauge” buyers’ interests and try to adjust the pricing accordingly.

Here are a few tips to try to beat online dynamic pricing in retail and travel:

  • Delete your cookies: Clearing your browsing history can eliminate retailers from tracking your online movements. Not sure what cookies are? Learn more about cookies and what happens if you don’t accept them. 
  • Use a store’s price match/price adjustment policy: Retailers like Target, Walmart, and Kohl’s have price matching or price adjustment policies. If you find a lower price in-store or online (including their own websites) within a specified time frame, they’ll adjust the price during checkout or reimburse you the difference.  
  • Set price alerts: and InvisibleHand track items’ prices for you and send you a notification via email when the price drops. CamelCamelCamel is a website that will only watch prices on Amazon. InvisibleHand, now called CNET Shopping, is a Chrome browser extension that monitors prices across retailers, including Lowes, Best Buy, and Sears, and airlines, including Southwest, American Airlines, and United. All you have to do is select the item(s) you want to be tracked and the price at which you wish to receive a notification.
  • Abandon your cart: Try putting an item in your online shopping cart and walking away. Retailers, including Macy’s, Bed Bath & Beyond, and Williams-Sonoma, are known to offer coupons to shoppers who abandon their carts. 
  • Shop online without being seen: OneLaunch’s incognito mode allows you to browse anonymously by preventing sites that you visit to set cookies to track you. 

It’s safe to say dynamic pricing is here to stay. So, while these tips won’t guarantee a win against dynamic pricing every time, they can help reduce the chance of you getting stuck paying a higher price than the next shopper.

Photo 192115339 © Piotr Adamowicz |