University of Portsmouth research helps businesses thinking of following Uber’s pricing model
Changing prices in real time, like Uber does when the demand for drivers goes up, is called dynamic pricing.
Other examples of dynamic pricing include purchasing Champions League tickets and hotel booking sites, where the price of a hotel room depends on its popularity at a particular time, as well as the availability of rooms in competing hotels.
A benefit of dynamic pricing is that the maximum revenue is generated at all times while goods and services that are short-lived, such as empty hotel rooms, are used up for profit rather than wasted. Look at the news though, and you’ll soon come across some of the potential downsides.
There are concerns about the fairness of the technique, with some consumers believing that companies are maximising their own benefits with little concern for customers, employees or independent contractors. Also, technological and infrastructure costs can still be high.
Recent research by the University of Portsmouth has looked at specific dynamic pricing models, such as online auctions, and has produced the following guidelines for businesses considering adopting dynamic pricing.
It is important to decide on a range of prices that you are prepared to accept for a product. Understand consumer and market pressures. If you fail to deliver, for instance by overbooking, then expect brand and image issues among consumers. Know your customer. Are they particularly risk-averse towards price changes, especially for the same product over time?
As the technology gets cheaper and easier to use, expect to see more small businesses changing prices dynamically.
Are you a charity needing help with your accounting?
If you’re a trustee of a charity, social enterprise or community interest group in Hampshire needing help with your accounting, the University’s pro-bono accounting clinic can help get your finances in order.
We can help with accounting issues such as independent examinations and annual reviews of internal controls. We can also provide finance training for your trustees.
The clinic is led by our second and final year accounting and finance students. They’re supervised by a qualified accountant who is a specialist in charity audits.
New world-class sports facility coming to Ravelin Park
Construction has started on the University of Portsmouth’s new high quality indoor sports facility in Ravelin Park. The facility will be open to students, staff and the community and is intended to be completed in spring 2021.
The building design aims to set new standards for sustainability and energy efficiency in indoor leisure facilities, and to be one of the UK’s greenest sports facilities. The design stage has already received a BREEAM UK outstanding design certificate, the world’s leading sustainability assessment method, which is a major step towards becoming the first BREEAM outstanding sport and leisure centre in the UK which incorporates a swimming pool.
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