After reading this article I was wondering what does it take for companies like Rental Cars, Hotels, Airlines, Ride Hiring Apps (etc.) to provide an instant price for the services quoted/requested, I can see all the previous service providers mentioned tend to used different strategies for pricing and I guess I have two main questions:
In a business sector (rental car for instance) how can you have all the different players quoting similar prices if they have different costs (fleet, location, employees, etc.) vs airlines where you can clearly see price difference among airlines?
What does it require (technically speaking) to apply almost RT pricing when is request by a customer in other industries that also provide services?
In all the industries you mentioned, the basic framework for thinking about prices uses the same variables discussed in this piece and also in another piece called the Value Pricing Framework - costs, customer value (however the specific company defines it) and relevant reference prices (whether they are a particular competitor's prices or their own previous prices, or a combination of both). To answer your questions:
1) I am not sure what you mean by "you" in the question. All rental car companies do not have similar prices! In fact, it is virtually impossible to find an industry where every single competitive offering is priced the same, not to mention that prices are not transparent in many cases.
2) Technically speaking, you need a price optimization software of the type sold by different vendors like Vendavo or PROS. Or you need to sell on an existing platform like Amazon or eBay which already has the means to write if-then rules to change prices. The bigger question to me is whether changing prices in real-time or even that frequently is an effective thing to do, and in my opinion, that answer often is, no it is not.
Thanks for replying to my comment, I guess what it amazes me is how quick is possible to compare prices in some services (rental car, travel, lodging) while in other industries it can take at least 24hr before you are getting a reference price (O&G Drilling Tools for instance), certainly it is not a fair comparison between two totally different industries but both of them provide quotes to potential customers. I was thinking on some of the variables that could help to get the most optimized price for a product/service but those variables are not very helpful if there is not sufficient data to compare against, and that could be one of the main reasons between getting and instant quote or taking +24hr to get it. Data sufficiency and how it is process.
After reading this article I was wondering what does it take for companies like Rental Cars, Hotels, Airlines, Ride Hiring Apps (etc.) to provide an instant price for the services quoted/requested, I can see all the previous service providers mentioned tend to used different strategies for pricing and I guess I have two main questions:
In a business sector (rental car for instance) how can you have all the different players quoting similar prices if they have different costs (fleet, location, employees, etc.) vs airlines where you can clearly see price difference among airlines?
What does it require (technically speaking) to apply almost RT pricing when is request by a customer in other industries that also provide services?
In all the industries you mentioned, the basic framework for thinking about prices uses the same variables discussed in this piece and also in another piece called the Value Pricing Framework - costs, customer value (however the specific company defines it) and relevant reference prices (whether they are a particular competitor's prices or their own previous prices, or a combination of both). To answer your questions:
1) I am not sure what you mean by "you" in the question. All rental car companies do not have similar prices! In fact, it is virtually impossible to find an industry where every single competitive offering is priced the same, not to mention that prices are not transparent in many cases.
2) Technically speaking, you need a price optimization software of the type sold by different vendors like Vendavo or PROS. Or you need to sell on an existing platform like Amazon or eBay which already has the means to write if-then rules to change prices. The bigger question to me is whether changing prices in real-time or even that frequently is an effective thing to do, and in my opinion, that answer often is, no it is not.
Thanks for replying to my comment, I guess what it amazes me is how quick is possible to compare prices in some services (rental car, travel, lodging) while in other industries it can take at least 24hr before you are getting a reference price (O&G Drilling Tools for instance), certainly it is not a fair comparison between two totally different industries but both of them provide quotes to potential customers. I was thinking on some of the variables that could help to get the most optimized price for a product/service but those variables are not very helpful if there is not sufficient data to compare against, and that could be one of the main reasons between getting and instant quote or taking +24hr to get it. Data sufficiency and how it is process.