4d ago

Personalized pricing can backfire on companies, says study

www.rotman.utoronto.ca

20250812 | Rotman School of Management | University of Toronto

cross-posted from: https://programming.dev/post/35839436

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5d ago

Personalized pricing can backfire on companies, says study

www.rotman.utoronto.ca /news-events-and-ideas/news-and-stories/2025/august/20250812/

11 comments

I've lost track of how many times I've walked away from some online product or service that I was interested in but refused to publicly disclose prices beyond, "FrEe TrIaL!"
Nah thanks. If you're playing mind games like that right off the bat, that tells me everything I need to know about the experience of using the product.
Gee, I would never have thought telling people you called them less and then make them pay more for the same things would upset them.
From the article
used mathematics and game theory to model
This is a theory paper, not a study on the ground. It's a reason to give honest pricing, but not new hard data on the practice. It also requires some (nontrivial, non obvious) assumptions about the kind of market. It really doesn't seem to me that the assumptions hold for, eg, air travel.
I do hope the theory is correct irl; personalized pricing is gross.
- But if you just market it as an airline rewards program people would love it. The cheaper the flight, the more miles you get per dollar. That's basically letting the cheapest people get the most rewards
Yes but it will backfire next year. This year bonuses will be sweet though.
Makes me wonder if I can start a company buying things online for other people, charging a small fee… find the requirements to get the lowest prices etc
- I used to buy plane tickets on a VPN with an exit node in Southeast Asia. Cross country USA for $95
  
  We should start a business lol.
- This guy discovering dropshipping about 25 years late.
- Then you can misrepresent the actual cost and skim/steal billions!
- Lowest price is the one thing your business plan cannot do. Finding the best value, or bse quality would be useful businesses. Dollar store and walmart already have the lowest price locked up, you need a eifferent niche.
  all retail is about buying thing for someone else at the bottom.

11 comments