3 On Your Side: Constantly Changing Prices
By Jim Donovan
PHILADELPHIA (CBS) - It used to be that only hotels and airlines changed their prices several times a day. But now online retailers who sell items like appliances and electronics are also making adjustments hour to hour.
While shopping online recently, Amy Shoaff noticed prices for the same item, on the same website, changed substantially throughout the day.
"General everyday items fluctuating anywhere from 40 to 300 dollars," she says.
Amy discovered a growing trend. Some retailers are changing their online prices often
The goal is to have a product priced so it pops up as the lowest priced item in shopping search engines, or Amazon's coveted "buy box."
"It's more a battle of getting the right screen position as opposed to trying to sell it as quickly as possible," says Chris Buckingham of the Professional Pricing Society.
For example, on one well known shopping website an iPad was $511 at midnight. At 6 a.m. it was $503. By 7 a.m. the price sunk to $475, where it remained until 2:30 p.m. and then jumped to $510. At 10 p.m. the iPad increased to a high of $529. That's a total of a $54 price difference on the same site-all in one 24-hour period.
"The suppliers are constantly monitoring each other," says Buckingham.
The prices on many different sorts of products can fluctuate. For example the price of colored pencils ranged from a high of $3.32 to $2.22 over a 24-hour period. And when it comes to duct tape: in one day the price ranged from a high of $7.83 to a low of $2.00.
Some retailers hire software companies, such as Mercent, to monitor the prices of its products and make changes based on its competitors.
"What has changed fundamentally in the past 12 months is the speed and scale at which prices are being set," says Eric Best, CEO of Mercent.
There are websites which will monitor prices for items you want and alert you when the price drops, or reaches an amount you'd be willing to pay. If you add an item to your Amazon shopping cart and leave it there Amazon will notify you of price changes.
By the way, if you ordered something from a retailer and the price dropped within a reasonable amount of time, contact the company and see if they'll refund you the difference.
