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Esteemed Contributor
Posts: 6,828
Registered: ‎01-14-2017

Re: Are Black Friday, Cyber Monday Deals Real?

 

Hi @monicakm 

 

Yes, Amazon employs a dynamic pricing strategy that causes some items to be continuously re-priced, as often as every 10 minutes.  This is not done by people, which might be why the lady told you that they don't control the pricing.  A machine does using an algorhythm or mathematical calculation.  

 

Prices are automatically adjusted based on a variety of factors such as inventory (how many they have to sell, what they paid for the item) and demand (how the item is selling), competition (prices elsewhere and by other sellers on the site -- I don't know if you have noticed, but some items have many sellers, who try to undercut each other), customer behavior (our purchases, us looking at products and putting them in our cart), and other market data (like availability elsewhere, is a product discontinued). This allows Amazon to continuously optimize its prices to maximize sales and its profit margins.  So for them to make money.

 

So this data is fed into a computer that spits out prices.

 

I think sellers can opt out of this, and set their own prices, which we see.  I am sure vendors pay Amazon to use their dynamic pricing (as well as the ability to sell there), so they may choose not to do that.

 

I think the government currently may be suing because it this may be anti-competitive, and may violate the U.S. antritrust laws.  No opinion on this on my part!

 

 

Honored Contributor
Posts: 25,830
Registered: ‎03-09-2010

Re: Are Black Friday, Cyber Monday Deals Real?

For some items, retailers don't have a lot of price control. You see this a lot with video games and videogame consoles. Sony, Nintendo, and Microsoft set the price, and stores are expected to toe the line. Give or take a bit. The "a bit" this year seems to be $0.99. The PS5 is $424.99 at Playstation's store and $424 nearly everywhere else. A few places match Playstation's price of $424.99. No one has a lower price than $424. Quite a few places charge even more. If a supplier says, "Sell this for no less than X price," then stores tend to do as they're told.

Fly!!! Eagles!!! Fly!!!

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