Deception & Manipulation at Christmas

“Dynamic Pricing” grows profits

Black Friday opened this year’s ground game for some department stores to make the most of Christmas shopping. At 12:01AM, crowds, eagerly waiting for hours, rushed to grab special “discounts” and “first 500 shopper” lures—with only a few casualties in the stampede.

Did early-birds get what was promised? Or did Deception & Manipulation set some consumers up? D&M is about deceptive techniques to get consumers to make rushed decisions. Example: big discounts—say 50% off list price—is often a game in which a high list price is established just long enough to make a 50% discount more credible than it should be.

Then there’s the phony scarcity trick: inserts variations of “only 6 left” in online product offers to push hurry-up purchases. Technically there might be 6 left. Or only six are left at a certain price with 600 more at another price, a few cents higher or lower.

United Airlines uses a variation of the “delayed real price” tactic by displaying round-trip flight costs that start with a departure choice whose lower price is maintained only if one particular return half is chosen. Otherwise the final price may be far higher.

Welcome to Dynamic Pricing, a tool for D&M to make list prices fluid. Dynamic pricing upwardly adjusts prices by via algorithms designed to continually boost prices in response to consumer demand or event promotion. It is a favorite of airlines, professional sports teams, theater performances and resellers (once known as “scalpers”). The World Champion San Francisco Giants website for 2015 tickets says upfront it uses Dynamic Pricing.

Dynamic Pricing tactics are legal, which may be the biggest abuse of all.

Next week: Abuse 2 at Christmas—Rush To Market (RTM). Sign up for my blog to be sure to get it.

My The Consumerist Manifesto Handbook  humorously shows how to deal with each of the Six Abuses. The 2nd edition is now available in paperback from using this link




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