How “Smart” Pricing Outsmarts Itself


How pricing that’s too “smart” can backfire on brand loyalty. A new study warns that dynamic pricing without fairness guardrails can trigger backlash. Think airline tickets. You might think you got a pretty nice deal on your flight. But if you find out the person in the next seat paid half what you did, it doesn’t feel fair anymore. The logic is pretty simple: Contextual pricing boosts profits by adjusting offers based on buyer traits. But when customers sense unfairness (whether across...