The company that I work for uses a dynamic pricing SaaS. This SaaS basically scrapes the 10-15 competitors' ecommerce websites, including the website of the company that I work for and they provide an excel sheet with every product and the price at which every company sells it for. Additionally if you have a contract with this company, you can also provide it your product stock information on a daily basis. This tells the SaaS how quickly or slowly some products are being sold.
It provides two services that I could tell (I'm not a pricing expert)
1. It gives you a "dumb" daily recommendation per product to either lower or increase the price so that your price in on par with the competitor who is selling it for the highest price.
2. It also gives you a "smart" daily recommendation per product to either lower or increase the price so that your price in on par with the competitor who is making the most sales.
Now I see no reason why all 10-15 competitors can't be subscribed to this SaaS and therefore all competitors are pricing their products practically the same. It's hard for me to come to terms with it, because on one hand it is "pricing it right" and on another it is algorithmic collusion.
The only moral issue I see here is that some products are "essential" (think food, toiletries) and therefore the customer will buy these products at prices that they are not comfortable with.
It provides two services that I could tell (I'm not a pricing expert)
1. It gives you a "dumb" daily recommendation per product to either lower or increase the price so that your price in on par with the competitor who is selling it for the highest price.
2. It also gives you a "smart" daily recommendation per product to either lower or increase the price so that your price in on par with the competitor who is making the most sales.
Now I see no reason why all 10-15 competitors can't be subscribed to this SaaS and therefore all competitors are pricing their products practically the same. It's hard for me to come to terms with it, because on one hand it is "pricing it right" and on another it is algorithmic collusion.
The only moral issue I see here is that some products are "essential" (think food, toiletries) and therefore the customer will buy these products at prices that they are not comfortable with.