Dynamic pricing is a strategy used by businesses to adjust the prices of products or services in real-time based on changing market conditions, demand levels, and other relevant factors. Rather than setting fixed prices, dynamic pricing allows businesses to optimize revenue by flexibly adjusting prices to match fluctuations in supply and demand.

By leveraging data analytics and sophisticated pricing algorithms, businesses can dynamically set prices to capture the maximum value from each transaction. For example, in industries like hospitality, airlines, and e-commerce, dynamic pricing is commonly used to offer discounts during off-peak times to stimulate demand, while prices may increase during periods of high demand or limited availability.

WPI experts on dynamic pricing are available to discuss the strategic advantages and potential pitfalls based on their experience, knowledge, and research on consumer behavior, marketing, AI, and supply chain management.