Randomised pricing a fun new tool for e-commerce?

By November 10, 2014

A Spanish startup has come up with a system that enables e-commerce customers to let chance decide the price they pay for their purchases. This gamified approach seems quite intriguing but raises a number of questions.

The idea of dynamic pricing for online purchases has been given lots of air time on the web and some players have put the concept into practice.  Now Barcelona-based PayRandom has come up with a way of enabling e-retailers to set prices in a completely random way. This approach differs from classic dynamic pricing systems implemented by a number of e-commerce sites in that it is based on chance – the spin of the wheel of fortune.  How it works is that when the customer is on the point of paying for his/her purchases, s/he can decide to randomise the price, twirling a virtual roulette wheel which will then decide what price is actually charged.

In fact a similar tool from AheadWorks has already been on the market since 2012, offering e-tailers a range of ways of varying their prices according to scales which they can set for themselves. However, the Random Price Extension is not very well-known and many of those who have used it report problems: attracting spam and intrusive advertising, and even channelling viruses into people’s systems.

It might therefore be an opportune moment to launch a new tool of this kind. The PayRandom creators seem to be betting that they can entice e-tailers with a fun tool that introduces the factor of chance into their business models.


PayRandom - The fun way to shop online from PayRandom on Vimeo.

It is up to each e-commerce site owner to decide for himself the range of higher and lower prices displayed on the roulette wheel for every product involved, but the PayRandom tool will work out the sales volume required to ensure that prices average out and the product line does not simple make a financial loss.  However the main selling point of the Spanish startup, which is partnering with Paypal on the mechanism for charging e-commerce customers, is the fun, gamification aspect.  They are betting that the chance of getting something cheap or for free – even though this is only a one in six chance on the wheel – will appeal to a large number of online shoppers and might help to cement customer loyalty.

Nevertheless, while randomised pricing might be a fun approach, it is not without potential problems. A customer who gets landed with a higher price several times running might start to distrust the system – and the e-tailer. So the underlying question is how far online shoppers trust e-commerce sites. Last year European digital economy think tank IDATE revealed that French people tend to distrust certain websites. E-tailers should therefore perhaps try to find a way to re-assure their customers before launching this type of payment tool.


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