THE ROLE OF VALUE-ADDED SERVICES IN DETERMINING THE RELATIONSHIP BETWEEN DYNAMIC PRICING AND CUSTOMER BUYING DECISION, WITH SPECIFIC REFERENCE TO AMAZON.
Aanchal Bakliwal, Jimmy Thankachan · Journal of Emerging Technologies and Innovative Research · 2020
With the rise of online retail, the sales game has gone up a few notches. Strategies that once proved to be fail-safe ways to secure business have become archaic, leaving companies struggling to develop new tactics to beat their competitors and rein in and retain customers. Even though a lot has changed in how sales-driven businesses approach the future, the pricing factor remains the same in persuading consumers to consider one company over another for the same product or service. The phenomenon of Dynamic pricing has been introduced in the last few years where large quantum’s of data are analysed and optimal prices for items are calculated. The time between the changes in prices depends upon the business and item, but can be as often as every day, or even every hour. Because of this strategy, our company under study, Amazon, is able to adjust to the lower cost of eCommerce and maximize profit on all fronts. With this technique Amazon is able to set flexible prices for products based on current market demands, trends, perishability of the product etc. Dynamic pricing, aka. surge pricing is a pricing strategy in which businesses set flexible prices for products or service based on current market demands. The time between prices, varies depending on the business and the item they are selling and can be as often as every hour, in case of Amazon. Though a vital tool for online sales, dynamic pricing has resulted in upset consumers who may find the inconsistent pricing to be deceitful. This paper, therefore brings in the moderating variable of value added services to understand if they can affect the customer buying intention, even with the negative effects of the Dynamic pricing strategy. The aim and purpose of this study is to understand the impact of dynamic pricing on customer buying intention fluctuation by using value added services as the moderating factor.