On Your Side Investigators: Artificial Intelligence now being used to compare prices
BIRMINGHAM, AL (WBRC) - Pricing is going futuristic.
Some companies now using "artificial intelligence" to crunch a lot of data and figure out how much to charge you at checkout.
Having what he wants simply show up on his door step is why Jonathan Volzke loves scouring the internet for deals.
"I can go to one site and see 10, 15, 20 of the same product-- different price points, and I can generally find exactly what I want," Volzke said.
We found shoppers like Jonathan aren't the only ones crunching competitor's prices.
Some major companies are doing it using artificial intelligence or AI software: humans write pricing algorithms, and computers capable of adapting to changes in supply and demand help update prices in near real time.
Attorney Maurice Stucke co-wrote two books on data and algorithm pricing.
"We're going from a world where people used to stamp the price on the product itself to a world where you're buying goods and services online or even off line but a pricing algorithm now determines it," Stucke said.
Experts predict it will be the pricing process more businesses use in the future.
"It's not a question of if, but more a question of when," Gary Liu, with Boomerang Commerce said.
Boomerang Commerce, which makes A-I enabled software, says it creates a more competitive market.
"By having more and more retailers that are using this technology, the retailers are able to update prices at scale, in a timely, relevant way and more competition typically means consumers win in the long run," Liu said.
Stucke is watching AI pricing algorithms with caution, concerned that we won't necessarily know if we get the best deal.
"We can't assume that the market forces by themselves will necessarily get us the right price," Stucke said.
An international economic council is meeting to discuss competitive "challenges raised by algorithms." the FTC is also watching this issue. Jonathan says he will continue to bargain hunt, but would like to know the prices he compares are the lowest of the low.
"I was surprised to find out that the price is derived through some complicated formula versus just the cost of the product, the cost of stocking it, the cost of mailing it,"Volzke said.
Experts say your best bet to find the best deal is still to compare online versus in store prices and even use apps to help you compare those prices.
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