Dynamic pricing is a strategy that allows businesses to automatically adjust the prices of products or services based on real-time data like demand, user behavior, competitor pricing, and more.

For websites, this usually involves tools that constantly look at these factors and adjust prices automatically, so the business owner doesn't have to do it manually. It's particularly useful for online stores, software companies selling subscriptions, and websites offering services.

How dynamic pricing works on websites

Websites that use dynamic pricing typically rely on automation and rules-based systems. Here’s how it generally works:

• Demand-based pricing: Prices go up or down depending on how many people are shopping, browsing, or buying.
• Time-based pricing: Prices change depending on the time of day, week, season, or during special events.
• User behavior tracking: Dynamic pricing tools can adjust based on how long someone views a product, if they’ve visited before, or what device they’re using.
• Competitor monitoring: Pricing can shift in real time based on what competitors are charging for similar offerings.
• Inventory awareness: Limited stock? The system may raise the price to reflect scarcity and demand.

This is all made possible by integrating pricing engines, APIs, or built-in features in your e-commerce CMS or website builder.

Examples of dynamic pricing in websites

• E-commerce platforms like Amazon often update prices multiple times a day using real-time market data.
• Online booking systems for hotels and airlines adjust prices based on seat availability, seasonality, and user demand.
• Subscription services might offer discounts for new users based on location or browsing history.

How to implement dynamic pricing on your website

If you're building or managing a site and want to use dynamic pricing, here’s where to start:

1. Choose the right platform: Use a website builder or CMS that supports dynamic pricing tools or extensions.
2. Set clear pricing rules: Decide which variables will trigger price changes – like time, location, or behavior.
3. Use real-time data: Pull in data from your CRM, analytics, or inventory system.
4. Test and monitor: Keep a close eye on how price changes affect conversions and customer satisfaction.
5. Stay transparent: Clearly communicate pricing policies to build trust and avoid confusion.

FAQs about dynamic pricing

Why is dynamic pricing important?

It allows businesses to stay flexible and competitive in real time. Instead of setting fixed prices and hoping for the best, you can adapt to what your market actually wants – and maximize revenue.

Is dynamic pricing the same as personalized pricing?

Not quite. Dynamic pricing changes prices for groups based on broader factors like demand or time, while personalized pricing targets individuals based on personal data like browsing history or location.

What industries benefit most from dynamic pricing?

Travel, retail, SaaS, hospitality, and events-based businesses often get the most value. But any business with an online store or booking system can benefit if implemented strategically.

How do I know if dynamic pricing is working?

Track conversion rates, sales trends, and average order value before and after implementing dynamic pricing. A/B testing can also help you refine your pricing strategy.

Build a smarter website with B12

Whether you’re managing pricing, bookings, or online sales, B12 helps you build a modern, professional website that can grow with your business. With powerful integrations and AI-assisted tools, your site is set up to adapt – no matter how your pricing strategy evolves. Start building your site today!