13. March 2024
Wolfgang Guggenberger, attorney and commercial law expert at PHH, was recently a guest on ORF’s Theme Monday “The Tricks with Prices,” where the increasing spread of dynamic and personalized pricing was discussed lively. You can watch a clip of the segment HERE.
Both Dynamic Pricing and Personal Pricing are of increasing importance in the digital age. The goal is to leverage the benefits of these strategies to improve efficiency, results, and customer satisfaction, while not losing sight of and adhering to legal frameworks.
Dynamic Pricing is a pricing strategy that allows companies to adjust their prices in real-time based on various factors such as demand, market conditions, inventory levels, and even weather conditions or season. Currently, the most visible application of Dynamic Pricing is likely in travel bookings, which can vary depending on the time of booking.
Regarding the legal regulation of these practices, there are several aspects to consider. Besides the relevant provisions of antitrust and competition law as well as data protection regulations, the prohibition of discrimination also plays a significant role. In any case, it is not allowed for Dynamic Pricing to be based on price fixing, coordinated behavior, or the abusive exploitation of a dominant market position.
Personal Pricing takes it a step further by setting individual prices for different customers based on their purchasing behavior, search history, and possible willingness to pay. This personalized pricing enables an even more precise adjustment to the individual customer but raises additional legal questions.
Currently, the European Commission is reviewing whether European consumer law is still suitable to ensure a high level of protection and transparency, especially in the digital domain.
For companies looking to navigate this dynamic environment, expert Wolfgang Guggenberger is always available to provide guidance and ensure that your pricing strategies are not only effective but also fully compliant with current legal requirements.