Demand-Based Pricing
Demand-based pricing, also known as dynamic pricing, is a strategy where the price of a product or service fluctuates based on current market demand. When demand is high, prices may increase; when demand is low, prices might decrease to attract customers. This approach allows businesses to maximize revenue by responding to consumer interest and market conditions. Common examples include airline tickets and hotel rooms, where prices change frequently based on how many people want to book. The goal is to align price with what customers are willing to pay at any given time.
Additional Insights
-
Demand-based pricing is a strategy where the price of a product or service is set based on the current demand from customers. When demand is high, prices may increase to maximize revenue; when demand is low, prices might drop to attract more buyers. This approach helps businesses respond to market conditions, optimize sales, and manage inventory effectively. Common examples include airline tickets and hotel rates, which fluctuate based on how many people are looking to book at a given time. The goal is to align pricing with customer willingness to pay.