Omnichannel
2025: The year of dynamic pricing or simply smarter pricing?
Retailers that embrace greater pricing agility in 2025 will be the ones that set themselves up for long-term success and improved relationships with customers.
March 21, 2025 by John Moss — CEO, Flintfox
Dynamic pricing is everywhere, from airline tickets to ride-sharing apps. However the idea of it being applied in retail stores, restaurants, bars and beyond sparked strong feelings in 2024.
As businesses race to embrace more advanced pricing strategies, one question remains: Is dynamic pricing really the future or is the real opportunity in smarter, more strategic pricing?
Ongoing fluctuating market conditions, supply chain disruptions, and new tariffs are forcing businesses to rethink their pricing strategies. In 2025, organizations will need to look for ways to maintain profitability without alienating customers and be able to adapt as quickly as today's market is changing.
The shift toward pricing dynamically
More businesses are exploring dynamic pricing models, leveraging AI and machine learning to adjust prices in real-time. The potential is huge — offering better margin control, data-driven decisions, and pricing strategies that adapt instantly to demand shifts.
But here's the catch: many businesses aren't set up to handle it. Retail alone generates four petabytes of data every hour, yet most ERPs can't process it fast enough to drive meaningful pricing decisions. That's why so many pricing teams still rely on undynamic spreadsheets, reacting instead of proactively managing margin and revenue.
Pricing in retail, manufacturing, and distribution is overdue for a digital transformation. The real win isn't just changing prices faster, it's controlling pricing with transparency, automation, and intelligence.
Navigating the challenges
However dynamic pricing doesn't just have its technology challenges to overcome, there are also challenges when it comes to customer perception.
When brands roll out price changes without clear logic or transparency, they risk alienating their audience. In 2024, we saw backlash when consumers felt price hikes were arbitrary or unfair. Businesses need to be prepared to navigate any concerns about fairness and transparency, sharing how prices are determined and striking a balance between profitability and customer trust.
To do this, businesses need more than automation, they need control. That means setting clear rules, communicating pricing strategies effectively, and ensuring customers understand why prices change. If businesses focus purely on speed without smart execution, they risk impacting their customer relationships.
The smarter approach to pricing in 2025
Ultimately dynamic pricing in its traditional form might not be right for every organization or industry, but the principle of revenue and margin transparency, along with the ability to set rules and adapt prices simply and quickly, is something that every business should be aspiring for in 2025. The ability to adapt pricing strategies quickly, maintain margin visibility, and automate complex pricing decisions will be essential.
Pricing dynamically can also offer benefits to consumers when it's informed by data and the right communication is in place. It can mean they get personalized deals tailored to their purchasing habits, and increased transparency when pricing models are based on clear factors.
Retailers that embrace greater pricing agility in 2025 will be the ones that set themselves up for long-term success and improved relationships with customers.
About John Moss
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