AI already knows your price
McDonald’s has rolled out a system that calculates how much people are willing to pay for a specific item.
It looks at millions of orders, competitors’ prices, and how customers respond to price increases. If people at one location are willing to pay more for a Big Mac without hesitation, the algorithm takes that into account.
A real-world example:
At two McDonald’s locations just 3 km apart, a Big Mac can cost $5.69 and $6.89. That’s a 21% difference.
Online retailers are already using the same approach: in the US, in 74% of cases, the same product is shown to different people at different prices.
AI takes into account purchase history, abandoned carts, time spent on a page, even mouse movements, and dozens of other factors.
According to research, personalized pricing is already generating 19% more profit for companies. So it looks like this is what sales will increasingly be built around.
More information about a person = more money.
McDonald’s has rolled out a system that calculates how much people are willing to pay for a specific item.
It looks at millions of orders, competitors’ prices, and how customers respond to price increases. If people at one location are willing to pay more for a Big Mac without hesitation, the algorithm takes that into account.
A real-world example:
At two McDonald’s locations just 3 km apart, a Big Mac can cost $5.69 and $6.89. That’s a 21% difference.
Online retailers are already using the same approach: in the US, in 74% of cases, the same product is shown to different people at different prices.
AI takes into account purchase history, abandoned carts, time spent on a page, even mouse movements, and dozens of other factors.
According to research, personalized pricing is already generating 19% more profit for companies. So it looks like this is what sales will increasingly be built around.
More information about a person = more money.