Dynamic Pricing Basics
What is dynamic pricing?
When businesses change price based on demand or other conditions.
When lots of people want something, prices may go ___?
Up.
Name a ride share company that uses dynamic pricing.
Uber
Who can make more money using dynamic pricing?
Businesses.
True or false: Dynamic pricing means prices can change.
true.
Do prices stay the same with dynamic pricing?
No, they can change.
When fewer people want something, prices may go ___?
Down.
What type of transportation changes ticket prices based on demand
Airlines.
What is one disadvantage for customers?
They may have to pay higher prices.
True or False: Uber always charges the same price.
False.
What is demand?
How much customers want a product or service.
What is one thing that affects dynamic pricing?
Customer demand.
Why might Uber rides cost more after a concert?
Because many people are requesting rides.
How can dynamic pricing benefit customers?
Prices may be lower when demand is low.
If a ride costs $10 and increase to $15, how much did it increase?
$5
What usually happens to prices when demand increases?
Prices often go up.
Why might prices be higher during busy hours?
Because more people want the product or service.
Why might airline tickets cost more near a busy holiday?
Because more people want to travel.
Why might some customers dislike dynamic pricing?
Because prices can change unexpectedly.
Dynamic pricing.
What is the main goal of dynamic pricing?
To increase profits and respond to customer demand.
Name 4 factors besides demand that can affect dynamic pricing:
Time, competition, availability, or customer demand patterns.
Name another business that may use dynamic pricing besides Uber and airlines:
Hotels.
When does dynamic pricing work best?
When demand changes often and businesses can adjust prices quickly.
A ride costs $12 in the morining and $20 during rush hour. Why?
Demand is higher during rush hour, so the price increases.