Individualized prices for different shoppers.

[techs]

http://www.nytimes.com/2012/08/10/b...izing-prices-for-shoppers.html?pagewanted=all

Shopper Alert: Price May Drop for You Alone

At a Safeway in Denver, a 24-pack of Refreshe bottled water costs $2.71 for Jennie Sanford, a project manager. For Emily Vanek, a blogger, the price is $3.69.

The difference? The vast shopping data Safeway maintains on both women through its loyalty card program. Ms. Sanford has a history of buying Refreshe brand products, but not its bottled water, while Ms. Vanek, a Smartwater partisan, said she was unlikely to try Refreshe.

So Ms. Sanford gets the nudge to put another Refreshe product into her grocery cart, with the hope that she will keep buying it, and increase the company’s sales of bottled water. A Safeway Web site shows her the lower price, which is applied when she swipes her loyalty card at checkout.

Safeway added the personalization program to its stores this summer. For now, it is creating personalized offers, but it says it has the capability to adjust prices based on shoppers’ habits and may add that feature.

Airlines, hotels and rental cars have offered variable prices for years. Those prices, however, are almost always based on capacity and timing, or are given to groups — seniors get one discount, frequent users another.

Now grocers like Safeway and Kroger are going one step further, each offering differing methods to determine individualized prices. Hoping to improve razor-thin profit margins, they are creating specific offers and prices, based on shoppers’ behaviors, that could encourage them to spend more: a bigger box of Tide and bologna if the retailer’s data suggests a shopper has a large family, for example (and expensive bologna if the data indicates the shopper is not greatly price-conscious).

In a 2005 survey conducted by Professor Turow, most adult respondents did not know that retailers could legally charge different prices, and more than 90 percent said they would dislike it if their supermarket charged different prices to different people within the same hour.

Retailers say the groundwork has been laid with individualized coupons, which are resoundingly popular. Sites like Amazon have also made consumers comfortable with custom offers and varying pricing, they say.



I just found this fascinating and decided to share it.

 

[Sheep]

Retailers say the groundwork has been laid with individualized coupons, which are resoundingly popular. Sites like Amazon have also made consumers comfortable with custom offers and varying pricing, they say.

Um, no. I remember Amazon trying this and getting a lot of backlash over it. I don't think their attempt at this lasted more than a few days.

 

[GagHalfrunt]

I can't see this working. It's going to come to light that on certain items a woman is charged more than a man or a black charged more than a hispanic and it's going to turn into a giant shit storm.

 

[CPA]

I get personalized coupons from Kroger's periodically. The coupons are for products that I normally by, plus one or two others that they are trying to steer me too.

 

[IronWing]

IMHO, personalized coupons are okay. Finding out what you will be paying at the checkout isn't cool though. It smacks of the airlines and their constantly changing fees as method of preventing price shopping.

Shop here - we just might have the lowest prices!

 

[kranky]

This could be a big plus actually. Seems that the lower prices are targeted at shoppers who do not buy a particular item (as an incentive to get them to try it). There are many products which are pretty much interchangeable like bottled watter. Just switch brands to whichever one is offering the bargain. To me there are just not that many products I am in love with (well, other than Pepsi Throwback).

The catch would be that nobody is going to be motivated to buy something they don't normally buy if they don't know it's going to be cheaper at the checkout. If people don't know beforehand they are going to get a deal, the deal is meaningless. I have to assume there is a method for communicating the deal to shoppers in advance somehow.

All this is going to do is entice people to get multiple loyalty cards for the same store to maximize the deals they can get. People will figure this scheme out pretty quickly.

 

[yhelothar]

Sounds like a brilliant pricing scheme.
I don't think people would really have a problem with it as long as it's worded as coupons and discounts rather than certain people have to pay more.

There was a study done on this called loss aversion.
http://scienceblogs.com/cortex/2010/02/10/loss-aversion/

 

[nanette1985]

I find this very annoying. I like to know the exact price of something when I'm shopping. I have a very tight budget. I dislike it when stores play stupid games.

 

[Zim Hosein]

Retailers say the groundwork has been laid with individualized coupons, which are resoundingly popular. Sites like Amazon have also made consumers comfortable with custom offers and varying pricing, they say.

I'd love to see which consumers were comfortable w/ varying pricing! :\

 

[BladeVenom]

I find this very annoying. I like to know the exact price of something when I'm shopping. I have a very tight budget. I dislike it when stores play stupid games.

That and people will spend time trying to exploit it. So either you have to do the same, or end up paying higher prices. I don't want to play that game.

 

[Anonemous]

Is this like amazon with the gold box products with discounts?

 

[shopbruin]

I've been using the Just4U program at Safeway a while.

If you are signed up, you log into the website and see the "deals" available to you. You click to add them to your club card. When you get to the checkout, the register will acknowledge your discounts on the items you're buying when you swipe your card. You will always know the price you'll be charged if you keep on top of this through their website (or app.) Not all items have a discount, obviously.

As for my personalized pricing, I do notice some deals on items I buy frequently, and I'll also get offers for "free" items, usually for new things that are in store.

Savings are hit or miss, I get deals for things I'd never buy. But it's best when I can combine with coupons and get a better deal, especially since my local Safeway doesn't double. I like the program overall though, since their "weekly" coupons I can also load to my card so I don't have to worry about remembering to clip those coupons.

 

[lxskllr]

I'd love to see which consumers were comfortable w/ varying pricing! :\

There's a few issues here. First, I don't like the idea of being tracked by stores. I use cards, but it's not my favorite thing. Studies have shown that food bought with loyalty program cards isn't any cheaper than food bought at stores that don't take them. Unfortunately, most stores use the cards.

I want to know what I'm paying when I put the item in my cart. Mystery prices piss me off, and I usually won't buy something if I can't see how much it is.

I don't have a problem with varying prices if it's a coupon system. That's why old school paper coupons are used. It's to get people to buy something they otherwise wouldn't, but electronic versions can be targeted better. They don't give discounts cause they're cool guys. They want you to try their stuff, and hopefully get hooked, and pay full price in the future. I've suspected big manufacturers dump stuff in closeout stores like BigLots to get people to try products they otherwise wouldn't. People like them, then go to a regular store and pay full price. It's kind of a circuitous coupon system.

 

[nanette1985]

I've been using the Just4U program at Safeway a while.

If you are signed up, you log into the website and see the "deals" available to you. You click to add them to your club card. When you get to the checkout, the register will acknowledge your discounts on the items you're buying when you swipe your card. You will always know the price you'll be charged if you keep on top of this through their website (or app.) Not all items have a discount, obviously.

As for my personalized pricing, I do notice some deals on items I buy frequently, and I'll also get offers for "free" items, usually for new things that are in store.

Savings are hit or miss, I get deals for things I'd never buy. But it's best when I can combine with coupons and get a better deal, especially since my local Safeway doesn't double. I like the program overall though, since their "weekly" coupons I can also load to my card so I don't have to worry about remembering to clip those coupons.

Appreciate your experience. No safeway's around here. My local store is Stop & Shop, which is similar. Except that the prices with card are always posted on the shelf. I think that's the law here. Yeah, I can read the circulars online, and the catalinas. I stopped being a coupon fanatic once my 4 kids grew up. except for CVS which is still really good. Happy shopping.

 

[shopbruin]

Appreciate your experience. No safeway's around here. My local store is Stop & Shop, which is similar. Except that the prices with card are always posted on the shelf. I think that's the law here. Yeah, I can read the circulars online, and the catalinas. I stopped being a coupon fanatic once my 4 kids grew up. except for CVS which is still really good. Happy shopping.

They do that here too. So in reality, there are three tiers of pricing.

Regular price.
Sale price with club card
Super sale price with enrollment in Just4U program.

Before they started rolling the program out further, they never advertised the "just4u" price. Now I am starting to see "If you signed up for just4U, you could get this for x.xx!!" Three prices on one tag. oi.

I agree, most of my coupon'ing goes on at CVS if I combine it well with ECB and coupons and CVS store coupons. Got two bottles of mouthwash the other day for 1.00.

So my overall point on this program: No, it isn't random price roulette when you go to the register. You need to be signed up for the program and load the deals onto your card in order to get the special pricing, but then you know for sure they are tracking your spending habits.

 

[fatpat268]

I find this very annoying. I like to know the exact price of something when I'm shopping. I have a very tight budget. I dislike it when stores play stupid games.

Hell, it bothers me that tax is not included in the prices. So something like this would bother me to no end.

 

[wirednuts]

i hate those loyalty cards, but my fav stores always seem to use them

so far, hyvee does not and im loving it. it says $2 on the pricetag, its actually $2 at the register. no food tax in wisconsin either.

 

[MovingTarget]

i hate those loyalty cards, but my fav stores always seem to use them

so far, hyvee does not and im loving it. it says $2 on the pricetag, its actually $2 at the register. no food tax in wisconsin either.

This. I do not want to fit any more cards in my wallet, nor do I want anything but keys hanging on my keychain. Some stores, like Winn Dixie, allow you to give your phone # associated with the card to the cashier if you don't have their card with you.

 

[pontifex]

That and people will spend time trying to exploit it. So either you have to do the same, or end up paying higher prices. I don't want to play that game.

it sounds to me that the regular price is 3.69 but the person who gets the offer gets the cheaper price. i highly doubt they would remove all pricing from the store and surprise you when you get to the checkout.

 

[Aso]

Rainbow foods did something like this wth thier loyalty cards it really bugged me. I haven't shopped at Rainbow since and refuse to because of this.

Schemes like this just suck and really turn off some consumers. My loyalty will be to stores that don't blatently try track and collect my shopping habits along with doesn't make me jump through hoops to get the"advertised" low price.

Sent from my SPH-D700 using Tapatalk 2

 

[BoomerD]

Um, no. I remember Amazon trying this and getting a lot of backlash over it. I don't think their attempt at this lasted more than a few days.

I thought they still did this...Search for an item...get one price...go back later, price has gone up...someone else searches for the item...price different.

 

[quikah]

I have just4u at Safeway also. I like it I guess, though it is not as good as the broken eco upon system they had before it,now that was awesome, but sooo broken. Basically they would repeatedly release a new ecoupon, so you would have 2-3 coupons for one item. You buy one of that item and all of the coupons loaded would come off. I was able to get so much free stuff.

 

[OverVolt]

Does not sit well with me.

Safeway already has high prices. I get alot of my dry goods shopping done at target, and I know for a fact many grocery stores overcharge by 20% or more for some items, like randomly butter or crackers at certain stores will have high prices and everything else is normal. Safeway will randomly have $7.99 butter for example.

I don't see how the margin can be "razor thin" when many places have prices 20% cheaper for some items. Its not my fault their inventory system sucks, or they lose inventory from bad storage or ordering too many perishables etc. Not my fault at all. Corporations really can't claim they're victims. They got into the retail business, they are middle men. What are they complaining about small margins for, its a small margin business. Its not like they made the crackers and bread they sell.

The resources producers have more leverage now and they are trying to gouge consumers, and so that will be their death knell. Not my problem!

 

[herm0016]

the program actually works pretty well. its not different prices all the time for people, its just coupons that are automatic when you use the card. there is also a smartphone app that you can check your coupons on while you are in store. The system will try to upsell you a higher margin product with a discount. The title is sort of misleading. You do not get the adjusted price every time, just when the system has it flagged for your card. usually it is just a one time thing from what i have seen.

 

[TallBill]

the program actually works pretty well. its not different prices all the time for people, its just coupons that are automatic when you use the card. there is also a smartphone app that you can check your coupons on while you are in store. The system will try to upsell you a higher margin product with a discount. The title is sort of misleading. You do not get the adjusted price every time, just when the system has it flagged for your card. usually it is just a one time thing from what i have seen.

Sounds cool. I'd be too lazy, but its not a terrible idea.