Dynamic Pricing Fundamentals - Dynamic pricing, though seemingly modern, has roots in traditional markets, with technology and regulations driving its evolution [4][5] - Variable pricing involves adjusting prices based on product, usage, customer, and time, encompassing multiple dimensions [6] - Dynamic pricing can lead to increased revenue and profitability for firms that effectively identify and implement strategies based on customer willingness to pay [21] Implementation and Strategy - Firms should consider the timing of dynamic pricing implementation, especially during periods of expected price increases like those caused by tariffs or inflation, as consumers may be more accepting of price variations [24][25] - Presenting dynamic pricing as "dynamic discounts" rather than "surge pricing" can improve customer perception and acceptance [25][26] Risks and Considerations - Unilateral implementation of dynamic pricing without considering competitors' actions can negatively impact the entire industry's profitability, as seen in the airline industry [22][23] - Dynamic pricing in labor markets, such as algorithmic pricing used by ride-sharing companies, can lead to lower pay for workers if not managed carefully [17][18] - Dynamic pricing may not benefit consumers if it doesn't increase supply or provide tangible benefits, leading to backlash [12]