Definition: Dynamic Pricing is a pricing strategy based on Discriminatory Pricing, which allows changing prices based on the supply and demand, time, competitor's prices, customers, or other external factors. Dynamic Pricing typically uses business analytics to model and forecast these factors to change the prices of products & services dynamically. A popular example of Dynamic Pricing is ride-hailing services such as Uber, which changes the price for a route based on the demand and time of the day. But airlines are well known to sell seats at dynamic prices for many years.
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