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How Retailers Use Personalized Prices

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Re: How Retailers Use Personalized Prices

#21
post #2

Retailers who ask customers if they would like to donate to charity after a sale are using it as a test to see if they can raise prices.

Do you know this, or are you assuming this? It is certainly possible that, at the margin, someone is willing to spend money on a charity but not spend that same money on the product. Although I suppose there's probably a correlation between donating and willingness to pay more.

It’s a way to test shoppers and evaluate their willingness to add a marginal dollar for spending. That can be correlated against buying behavior and taking advantage of discounts.

Right now, for a grocery store, that means they can put butter on sale that women will buy for Christmas cookie making, and market sprinkles and decorative sugar at higher prices (or with a coupon) to increase customer value. That MDA heart that you bought on Labor Day weekend helps assess the effectiveness of that sort of promotion.

Re: How Retailers Use Personalized Prices

#23

There must be some incredible data being mined by Amazon via Whole Foods. At the Whole Foods in Palo Alto, there seems to be an elaborate pricing experiment in the ice cream department. Entire brands (Talenti) are dropped in price 70%. Other times, particular flavors are reduced that much, sometimes less so. For Talenti, the entire brand is sold out. Some of the on-sale flavors go quickly or are also sold out while o…

Alternatively: Amazon has decided certain brands won't be carried anymore. Therefore those brands are getting steep discounts to clear the stock and Wholefoods' legacy contracts quickly.

Re: How Retailers Use Personalized Prices

#24
post #18
post #2

Retailers who ask customers if they would like to donate to charity after a sale are using it as a test to see if they can raise prices.

I don't think grocery retailers "raise prices" across the board. I think the "charity bundling" concept is just for P.R. The company presents the big check at the end of the campaign, and the public then credits the company, even if the company itself contributed nothing beyond a little (deductible) personnel time. The Ronald McDonald House perfected that mechanism. Some retailers used to do the same with pooling cus…

BTW, I'm not opposed to this mechanism if the retailer is matching customer contributions.

Re: How Retailers Use Personalized Prices

#26
post #16

At some point in the next 5 years, I predict there will online services that will "proxy-shop" for you. They will specialize in building profiles (cookies, logins, etc) that get offered low prices, then use these to purchase products on your behalf. Perhaps a browser plugin, so that at the moment you go to check out on a product, you send the product's link to the service and they get it for you at a lower price. The…

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Re: How Retailers Use Personalized Prices

#27
post #19
post #16

At some point in the next 5 years, I predict there will online services that will "proxy-shop" for you. They will specialize in building profiles (cookies, logins, etc) that get offered low prices, then use these to purchase products on your behalf. Perhaps a browser plugin, so that at the moment you go to check out on a product, you send the product's link to the service and they get it for you at a lower price. The…

So a travel agent? What's old is new again, I guess.

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Re: How Retailers Use Personalized Prices

#28
I have recently learnt it is same with energy companies. My monthly contract prices were hiked up to get more out of heating bill for energy company. I was left disgusted since we live in a relatively warm house and energy bills are minimal. After spending an hour with support - it became clear that prices are tailor made for postcode - read each individual home.

Re: How Retailers Use Personalized Prices

#29
post #19
post #16

At some point in the next 5 years, I predict there will online services that will "proxy-shop" for you. They will specialize in building profiles (cookies, logins, etc) that get offered low prices, then use these to purchase products on your behalf. Perhaps a browser plugin, so that at the moment you go to check out on a product, you send the product's link to the service and they get it for you at a lower price. The…

So a travel agent? What's old is new again, I guess.

> So a travel agent.

Travel agents were never on the side of the consumer. If you asked travel agents who they perceived they were working for, they'd tell you it's the airlines. This is not just my opinion; in travel industry magazines, articles, etc., this definitely was their stance. They'd choose flights for you that were most profitable for themselves and/or the airlines (and those two factors coincide nicely). Even pre-web, I almost always found a better prices by phoning the airlines directly if I wanted to spend the time.

Re: How Retailers Use Personalized Prices

#30
post #8
post #2

Retailers who ask customers if they would like to donate to charity after a sale are using it as a test to see if they can raise prices.

That seems like a very weak and noisy signal compared to, you know, directly changing prices, which they do all the time.

But this is data for an INDIVIDUAL person!
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