Companies are using AI to adapt pricing policies
By ForGeeks
Instability in online shopping is on the rise. Many have probably experienced the fact that the cost of airline tickets, hotels, and other services constantly vary and differ from user to user. It turns out that companies are actively adopting artificial intelligence to personalize pricing.
An innovative AI-based pricing model is behind these changes. In the past, online retailers have used dynamic pricing systems where prices were adjusted based on demand, time of year or competitor activity.
But currently, AI learns a customer’s browsing history, purchases made, geographic location, devices used, and even social media information from customers. Based on this data, a detailed “customer portrait” is created, allowing it to offer personalized prices to everyone. It is noted that air carriers were the first to widely implement such technology.
First, they adapted prices based on seat availability and time remaining before departure, and then began analyzing customers’ online activity. But along with comfort came new challenges. Personalized pricing challenges the principles of openness and fairness, as different consumers may pay different amounts for identical goods or services, often without even realizing it.
Personalized pricing is a challenge to the principles of openness and fairness, as different consumers may pay different amounts for identical goods or services, often without even realizing it.
