Dynamic pricing

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Rikkitic

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#208980 7-Mar-2017 15:23

Maybe I'm slow off the mark but I just now, for the first time, heard of something called 'dynamic pricing'. Apparently it started with the airline industry but is now, thanks to Google, supposed to be common for much on-line advertising. What it means is that your interests are tracked and when you click on an ad, the price you see depends on how badly the advertiser thinks you want it. If your interest is assessed as high, you will see a higher price than your more casually clicking neighbour.

I have an intense dislike of all advertising so I never see any at all since I go out of my way to avoid it. I have ad blockers and a javascript switch and I never use any Google services, for example. This kind of greedy BS just reaffirms my aversion.

The other day, I saw a post from someone on the Geekzone ads thread who said he actually appreciated advertising and often bought things. Guess what, sucker? Your clicks are costing you money. This kind of behaviour is why I am convinced most on-line advertisers are mean-spirited privacy-violating dishonest scum who will use any trick at their disposal to suck money from their victims. Some people are quick to say advertisers pay for all those wonderful Internet goodies we enjoy, but that is how the Internet started out anyway. Things were free, people enjoyed sharing their creations and knowledge, and there was a great spirit of camaraderie and being part of something special. No-one needed ads for that.

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#1732611 7-Mar-2017 15:58

Dynamic pricing has been going on for years. It is only costing you money if you don't know the value of the item you are purchasing and don't shop around. I think Amazon may use this type of pricing for some things, as their prices can vary a lot. But many things such as Kindles are a fixed price.

Rikkitic

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#1732619 7-Mar-2017 16:09

It was news to me but as far as I can see, it is just another reason (there are very many) to ignore ads.

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#1732622 7-Mar-2017 16:16

Rikkitic:

It was news to me but as far as I can see, it is just another reason (there are very many) to ignore ads.

Adverts though do pay for a lot of the internet. If people shop around they shouldn't have an issue, although some people don't. I would be far more worried about facebook and other social media TBA and some of the info that collects. Those innocent looking surveys for example, are collecting a lot of information about you. Apparently that is how Trump was able to target his message to certain groups

ANglEAUT

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#1732679 7-Mar-2017 18:32

@Rikkitic: ... for the first time, heard of something called 'dynamic pricing'. Apparently it started with the airline industry but is now, thanks to Google, supposed to be common for much on-line advertising.

It definitely has been going on for years. There previously was an uproar about retailers or hotel chains displaying higher prices for people visiting their website while using Apple devices. Apparently, iOS / OSX users would be more likely to pay higher prices. Uber has surge pricing where your desire to travel at peak times adds to the cost due to the high demand. Airlines allow you to choose a particular seat; at a cost that is. All of these are ways to extract another dollar based on your profile, interest & previous behaviour.

Google certainly is not the only or even major culprit of this. Google do have an option in their settings to not receive interest based ads. Just like Facebook though, you have to be a member of the system to be able to opt out.

Please keep this GZ community vibrant by contributing in a constructive & respectful manner.

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#1732680 7-Mar-2017 18:33

mattwnz:

Rikkitic:

It was news to me but as far as I can see, it is just another reason (there are very many) to ignore ads.

Adverts though do pay for a lot of the internet. If people shop around they shouldn't have an issue, although some people don't. I would be far more worried about facebook and other social media TBA and some of the info that collects. Those innocent looking surveys for example, are collecting a lot of information about you. Apparently that is how Trump was able to target his message to certain groups

I think the acid test is to cancel ALL advertising. I mean ALL. We all hate ads, but they are important. I'd like to see how many businesses would do, if there was zero advertising.

So, we have to accept, it, avoid it if we want, but if we turned off advertising our wares, thats a hard row to hoe.

sbiddle

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#1732712 7-Mar-2017 19:31

Somebody wrote a bit piece in the MSM last year (NBR, NZ Herald or something similar) talking about dynamic pricing for airlines but made a complete idiot of themselves because they didn't actually understand how airline pricing works (fare buckets / booking classes etc). Some airlines (Easyjet being a classic example) actually refer to dynamic pricing in a very different way to you're describing. While it's still dynamic pricing - the dynamic pricing you're describing is truly dynamic and not related to demand - it's simply prices changing according to how much you really want something or your browsing habits. This isn't something that's commonplace in the airline world.

It's something I've come across a handful of times online, and is incredibly common with all the hotels in Vegas that are part of the Caesar's chain. Try browsing and booking a room on their site and you'll see pricing can dynamically change when you go back. Open up an in-private window or different browser and you'll find pricing drops again.

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#1732741 7-Mar-2017 21:04

And if you go back to buy the cheapest fare you just saw on Airnz it's just gone up in price. But if you go back in incognito the good price is back.

Lesson learned: never browse airfares while logged in.

And in totally unrelated news, pricing geographically is a thing too, the price of domestic airfares vary wildly depending on which country you appear to be booking from.

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#1732744 7-Mar-2017 21:09

mattwnz:

Rikkitic:

It was news to me but as far as I can see, it is just another reason (there are very many) to ignore ads.

Adverts though do pay for a lot of the internet.

If you say so. It seems impossible to me... in the end, the advertiser makes more money if they advertise than if they don't, otherwise they wouldn't advertise. But I just don't see how; surely there aren't that many people switching to Vodafone (to quote what the current ad is saying... I had to go and look) in response to their ad that it makes it worthwhile to pay much for those ads. I know it makes no difference to me. So how much does Vodafone actually pay for these mostly ineffective ads? In which case, how much of a particular site is funded by those annoying ads?

And can they *please* get smarter with their targeting? After Googling for things to do in San Francisco, I've booked a couple of things. So why the hell do they keep advertising back to me the things I already booked? Surely they must know that the odds of me booking yet another trip to Alcatraz in response to their ad must be vanishingly small? And if I didn't book a "Hippie Tour to the Redwoords" the first 10 times they showed me the ad, I'm not going to now?

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#1732748 7-Mar-2017 21:22

1eStar: And if you go back to buy the cheapest fare you just saw on Airnz it's just gone up in price. But if you go back in incognito the good price is back.

Air NZ doesn't actually do that - in fact no airline I've encountered ever does. What you see is a consequence of fare buckets and booking classes. Exactly what sbiddle said, your misunderstanding made you look just as silly as the media looked with that article.

Generally there will be a pile of booking classes. Economy will be F (Grabaseat) followed by Y, X, U, N, as an example. All of these will cost a differing amount (and award a differing amount of status credits and reward points) and be limited in availability. There won't be as many cheaper fares and there will be more of the expensive fares. As time progresses and demand needs are calculated, the booking systems will reallocate the remaining economy seats among the booking classes to maximise seat utilisation.

sbiddle

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#1732760 7-Mar-2017 21:39

1eStar: And if you go back to buy the cheapest fare you just saw on Airnz it's just gone up in price. But if you go back in incognito the good price is back.

Lesson learned: never browse airfares while logged in.

And in totally unrelated news, pricing geographically is a thing too, the price of domestic airfares vary wildly depending on which country you appear to be booking from.

As somebody who books 50+ Air NZ flights a year I have never seen a single piece of evidence that they operate any form of dynamic pricing in the way you're suggesting. If you have documented proof of this I'd be incredibly keen to see this.

Dynamic pricing (based on cookies etc) is very hard to build into an airline model based around GDS access. Airline pricing is an open system accessible from multiple GDS endpoints as well as the airline booking engines themselves. Yes dynamic pricing happens (only certain fare classes are available on certain flights & cheap fare classes are not necessarily available at busy times) but it simply does not operate in the way you're suggesting.

If you see the price of a fare has gone up it'll be because that booking class is no longer available. Proof of that can be viewed by using apps with direct GDS access to validate the real-time availability of booking classes and fares such as Expert Flyer or KVS tool. Geographic pricing is certainly a thing in the airline business, but not always in the way it seems. Try and book a NZ domestic fare from another NZ site (such as the US one) and you'll see pricing is higher because you can't book a seat only fare from outside NZ.

All of this is very, very, very different to real time dynamic pricing that sets pricing based on cookies or ads you've viewed.

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#1732792 7-Mar-2017 23:07

sbiddle:

As somebody who books 50+ Air NZ flights a year I have never seen a single piece of evidence that they operate any form of dynamic pricing in the way you're suggesting. If you have documented proof of this I'd be incredibly keen to see this.

I agree, have never seen fares change like that however I had been browsing their US site for Europe fares once inside the US and then went to book a standard flight inside NZ, man oh man are they screwing the tourists

Monday 14th August as example, Auckland to Wellington both seat and bag.

Air NZ US region - $149 USD

Air NZ local - $79 NZD

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#1732810 8-Mar-2017 05:48

itxtme:

sbiddle:

As somebody who books 50+ Air NZ flights a year I have never seen a single piece of evidence that they operate any form of dynamic pricing in the way you're suggesting. If you have documented proof of this I'd be incredibly keen to see this.

I agree, have never seen fares change like that however I had been browsing their US site for Europe fares once inside the US and then went to book a standard flight inside NZ, man oh man are they screwing the tourists

Monday 14th August as example, Auckland to Wellington both seat and bag.

Air NZ US region - $149 USD

Air NZ local - $79 NZD

These flights are neither the same fare code nor fare basis so it's not really comparing apples with apples. Air NZ are pretty open about this if you look at their travel agent information so their concept of "dynamic" pricing does deliver geographic pricing variables. There is also nothing to stop you logging into the NZ site from the US and buying a ticket, and such a thing isn't that uncommon in the airline world.

None of this changes the fact the pricing does not change depending on browsing history or cookies.

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#1732851 8-Mar-2017 09:19

I read about this somewhere after I had booked my tickets to Japan - use private browsing to make sure that the websites (like Expedia/Skyscanner) are not tracking you and showing different pricing. Maybe the next time I book tickets somewhere (or hotels) I try both methods over a period of a week and see what happens.

Rikkitic

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#1732853 8-Mar-2017 09:28

According to DuckDuckGo (I haven't confirmed), you can still be tracked even with private browsing. You need to do more than that to shake the parasites off.

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itxtme

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#1732873 8-Mar-2017 10:00

sbiddle:

These flights are neither the same fare code nor fare basis so it's not really comparing apples with apples. Air NZ are pretty open about this if you look at their travel agent information so their concept of "dynamic" pricing does deliver geographic pricing variables. There is also nothing to stop you logging into the NZ site from the US and buying a ticket, and such a thing isn't that uncommon in the airline world.

None of this changes the fact the pricing does not change depending on browsing history or cookies.

Totally agree, not dynamic pricing but I do find it incredible there can be such a discrepancy for the exact same product. Apart from the literal change in fare code, what is the difference between the two? Looks like a couple extra bucks in airpoint dollars and a few status points, but nowhere even near considering hiking prices like that. And totally agree nothing stopping you from switching websites, thats what I was doing when I noticed it by accident. In fact I freaked out prices had sky-rocketed for the dates I needed for internal flights. We are talking about a 163% mark-up for what is essentially the same thing. This is something I had never been aware happened to such a massive degree!

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