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A consultant at Pricing Solutions recently presented some learnings he took away from an IBM conference on the topic of analytics. An important topic was the emerging frontier of using real time data to make real time decisions. From a pricing perspective, how could this level of data analytics move companies forward in their ability to be good value based pricers?

In a number of industries, such as airlines and hotels, real time pricing is already applied. We are all familiar with how quickly and drastically airfares increase as the flight date gets closer or the number of available of seats decreases.

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In other industries, implementing a price change is a much slower process. We consult clients on pricing processes, strategies and implementing a price change and it is not always easy to sell the change through the organization.

How could real time data help? For one thing the pricing decision becomes more automated. Imagine an environment where a product price changes based on demand at a time of day or day of week. For example, what if you paid a different price for a Blue Jays game if you bought your ticket in advance vs. showing up in the fifth inning? Or, what if the price of a ticket for a Leafs game changed throughout the season based on their standing? If the past few years are any indication, ticket prices would drop dramatically!