The meaning behind 'dynamic pricing' and its impact to consumers

HOUSTON, Texas -- Buying a product or service, and the price changes based on demand, time, location, or similar factors? That is a practice known as 'dynamic pricing.'

"Dynamic pricing is basically changing prices based on market conditions over time. So, that means the supplier that you're looking at might look at the supply of what they have to offer and what the demand is," Rice University Assistant Professor of Marketing, Emily Prinsloo, Ph.D., said.

The practice is often seen with ride-share apps that adjust prices based on demand or for popular routes.

The practice could also be making its way to brick-and-mortar stores.

Walmart announced they will begin using digital shelf labels in some stores, which could lead to dynamic pricing. Experts say there are ways to get around dynamic pricing.

"If you are booking online, try to book early to get the less popular times for booking. You can also try shopping midweek. So, Tuesdays and Wednesdays are better than shopping on the weekend, which is more popular. You can also use price trackers," Prinsloo said.

State leaders in Maryland announced and eventually passed legislation banning the practice at grocery stores and related services. Other states are considering doing the same thing.

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