Supermarkets Try Customizing Prices for Shoppers - NYTimes.com
Jared Sperli stashed this in economics
Stashed in: Retail
Safeway added the personalization program to its stores this summer. For now, it is creating personalized offers, but it says it has the capability to adjust prices based on shoppers’ habits and may add that feature.
Airlines, hotels and rental cars have offered variable prices for years. Those prices, however, are almost always based on capacity and timing, or are given to groups — seniors get one discount, frequent users another.
Now grocers like Safeway and Kroger are going one step further, each offering differing methods to determine individualized prices. Hoping to improve razor-thin profit margins, they are creating specific offers and prices, based on shoppers’ behaviors, that could encourage them to spend more: a bigger box of Tide and bologna if the retailer’s data suggests a shopper has a large family, for example (and expensive bologna if the data indicates the shopper is not greatly price-conscious).