Personalized Pricing: the Future of Marketing

One of retailers’ biggest marketing concerns is how to target as many potential customers as possible with its marketing campaign. Traditionally, promotions can never target every single potential customers since each customers have unique needs. This inherent flaw in traditional pricing is about to end as supermarkets such as Safeway and Metro are introducing individualized pricing strategy. Under this new marketing strategy, retailers are sending out personalized coupons to their customers via mobile apps. This is done through by tracking an enomrous amount of data regarding customers’ purchasing patterns and analyzing them with complex computer algorithms. For example, “Dunnhumby tracks more than 1 billion items purchased each week”and use computer softwares to analyze these data to predict the customer’s wants to create persoanlized coupons. The idea of personalized pricing is a perfect example of the intersect of two different business disciplines: marketing and management information systems. The use of MIS helps gather and analyze the data which is later to create different marketing tactics. However,the individualized pricing strategy has only improved Safeway’s revenue by 1% sinces its implementation, demonstrating the inefficiency that plauges most MIS undertakings.