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Will Pricing Innovations on the Web Survive?

by Allen Weiss  |  
January 1, 2001
  |  7,373 views

Now that Priceline (PCLN), the name-your-price innovator, is hitting on hard times, people are wondering whether really new pricing innovations are part of the Internet's future.

I expressed considerable skepticism about Priceline's decision to enter the grocery and gasoline business in an article I wrote a number of months ago (Gambling for Groceries with Priceline.com). Unlike airline seats or hotel rooms that provide no income to the supplier if unused, extending this pricing concept into selling non-perishable items seems flawed.

NEW PRICING IDEAS?

While the future of Priceline may be in doubt, the idea of pricing innovations on the net seems economically sound, and the net sure allows for all sorts of new pricing schemes.

Its not surprising then that we have pricing "innovations" from companies like iderive.com.


With iderive you search for a product and are shown the List Price and the Iderive price (a "Bargain pricing you won't find anywhere else", they claim). The catch is that the Iderive price is for some specified future date, and when that date arrives, the product may or may not be available.

To compensate those who buy a product that is later unavailable, buyers are given a "Get Paid" amount; a cash payment that compensates them for their time.

If this sounds like an "options pricing contract", well, essentially it is.


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Allen Weiss is the founder and publisher of MarketingProfs.com. He can be reached at amw@marketingprofs.com.

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