It's common knowledge that prices of retail items change: Presidents’ Day Sales, Black Friday Sales, post-Valentine’s Day markdown sales just to name a few.

As consumers, we’re always trying to time our shopping to these events.

But what many people don’t know, is that retail prices are changing all the time, not just during sales events. This is largely due to dynamic or algorithmic pricing models.

Dynamic or Algorithmic Pricing

The most well-known example of dynamic pricing is airplane tickets. As evidence, a quick Google search reveals that two of the top 10 searches for “best time to buy...” are for airline tickets.

On the right, we can also see how much airline ticket prices fluctuate.

So far this isn’t newsworthy. What is, however, is that the e-commerce world uses the exact same techniques for pricing normal consumer goods that airlines do for plane tickets.

Put another way: we could change the title of the price graph above to “Prices of toasters over time” and the results would look very similar.

Digging into Dynamic Pricing online

To show how prices are changing, we’ve used Waldo to help track price changes for millions of different products over the past couple months.

We can see below in this very messy chart of 20 or so products, that the prices of these items are constantly changing, and that the magnitude of the changes is large.

Lower Priced Retail — Products Under $100

Let’s filter this chart down and look at items that are priced below $100:

Some serious volatility here!

Let's dig into an example from the chart above.

Cannon Inkjet Printer – Newegg

What’s super interesting is that Newegg indicates that the printer is on sale for $99.99 and was previously listed at $114.61. What's even crazier is the frequent pricing volatility this printer has experience in the last month-and-a-half alone!

The printer hit its rock-bottom price at 54.33. That's over 50% off its peak price!

Higher Priced Retail – Products Over $500

With sales typically being something like “__% off “, we should expect to see larger price differences over time for higher priced goods.

Microsoft Surface Pro – Best Buy

Microsoft Surface Pro 12.3" Touch Screen Link

More common electronic purchases have huge price fluctuations.

Best Buy sells a Microsoft Surface Pro model that over the past month alone, has seen a high price of $899.99 and a low of $599.99. That's a 40% discount off the original price!

Arlo Pro 2 – Best Buy

Who doesn’t love watching their dogs around the house while they’re at work?

Arlo Pro 2 3-Camera Indoor/Outdoor Wireless 1080p Security Camera System Link

The Arlo camera at BestBuy typically retails for around $550, but we see some huge differences, where late January, prices were as low as $484.99 and as high as $679.99.

That’s a $195 difference over just a 10-day window!

Clothing

Clothing tends to have larger price changes over time too.

Below, we can see the corresponding prices for the above products.

LOFT Pants: Ann Taylor Dress:
Min. Price $34.99 on Apr. 9th $45.99 on Mar. 12th
Max. Price $79.99 on Mar. 7th $89.99 on Mar. 5th

So what does all this mean?

As a consumer, it doesn’t feel great to have to constantly worry about product prices.

A product on sale today could be marked down further tomorrow, and based on the charts above, this happens all the time.

However, there is a way that you can buy goods and not worry about a sale occurring the next day: price protection policies.

Price protection simply means: if you buy something today and it goes on sale tomorrow, you can reach out to the retailer and they will honor the new sale price.

The catch is: you have to watch the items you’ve just bought to see if they go on sale.

This is why we built Waldo.

You shouldn’t worry about timing sales, monitoring prices of products, and then requesting price adjustments.

You should be getting the best price, all the time. Sign up for early access to the beta at our website or subscribe to our blog below.