Behavioral pricing

I can't be 100% sure, but I believe I was almost a victim of an internet site adjusting their prices based on my web surfing behavior...

I had been using one of the major travel sites to book an air and hotel combo the other day. I looked at the site several times to check prices, and once even got to the purchase screen, before I decided to back out and check one other site to see if there was a cheaper deal.

Finally I decided there wasn't a better deal out there, went back, and looked up my flight and hotel combo again, only to find that it was now $40 more expensive. Now I have seen airline tickets change prices over a period of days, but this price had changed in 10 minutes, at 8PM at night. I checked the individual prices at the airline and the hotel websites - those prices had not changed. So the price change came from this particular site alone.

So I went to a different site to buy the package at a slightly higher price than the original price, but cheaper than the new $40 more price. But then I decided to just check again in the morning to see if the price went back down.

An hour or so later, I remembered reading an article awhile back about how travel sites might offer different users different prices. For example, maybe they offer cheaper prices to people without accounts in order to get them to register the first time, or maybe they offer cheaper prices to frequent customers to keep them loyal.

On a hunch, I deleted all my browser cookies. I went back to the site, and suddenly my trip was the original price I had seen many times before.

So one of two things happened: 1) There was a random fluctuation in pricing over about a 2 hour period. or 2) For some reason, some computer algorithm thought that I deserved a $40 price raise in the package I was trying to buy.

I'll never know for sure what happened. But it is pretty interesting to think about the implications of changing prices on interenet stores. At your brick and mortar store, it wouldn't work to offer different prices to different customers - they would all see eachother's prices and complain. But on internet sites, where everyone could possibly see something different, who knows what is really going on...