Designing a performant real-time modular dynamic pricing system : Studying the performance of a dynamic pricing system which updates in real-time, and its application within the golfing industry

Sammanfattning: In many industries, the prices of products are dynamically calculated to maximize revenue while keeping customer satisfaction. In this paper, an approach of online calculation of prices is investigated, where customers always receive an updated price. The most common method used today is to update prices with some interval, and present that price to the customer. This standard method provides fast responses, and accurate responses for the most part. However, if the dynamic pricing model could benefit from very fast price updates, an online calculation approach might provide better price accuracy. The main advantages of this approach is the combination of short term accuracy and long term stability. Short term behaviour is handled by the online price calculation with real-time updates, while long term behaviour is handled by statistical analysis of booking behaviour, which is condensed into a demand curve. In this paper, the long term statistical analysis for calculating demand curves is described, along with the benefit of short term price adjustments which can be beneficial both for producers and consumers.