retail news in context, analysis with attitude

Talk about flexible pricing models...

The Wall Street Journal reports on how, "deploying a new generation of algorithms, retailers are changing the price of products from toilet paper to bicycles on an hour-by-hour and sometimes minute-by-minute basis."

According to the story, "The most frequent price adjustments are occurring among Web stores selling products on Amazon, which encourages ruthless competition between retailers vying for the top spot among search results. Sellers such as children's clothing store Cookie's use software to change prices every 15 minutes in order to stay on top of Amazon rankings ... A goal is to maintain the lowest price - even if only by a penny - so that their products will show up at the top of the search results by shoppers doing price comparisons."

Of course, as in most things, there is an upside and a downside. The Journal notes that "once the low-price vendor for a particular item sells out, rivals selling the same product can immediately lift their prices without fear of being undercut ... So far, shoppers are winning the price game about as often as they lose—with about half of price changes going down, and half going upward, according to Decide.com, which tracks prices of products over time to determine the best time to buy them."
KC's View:
The simple reality would seem to be that if this kind of competition is taking place online, it will have to extend to offline retailers in various venues, which will have to figure out how to play this game if they are going to be competitive.

Because I'm not sure anymore that there is online competition and bricks-and-mortar competition. There is just competition.

And ... I can't help myself ... "compete" is a verb.