Adoption of Dynamic Pricing technology by Food Retailers: Efficiency Gains, Cannibalization and Food Waste.
(A2025-126289)

AUTHORS

Amir Heiman, Hebrew University; Monika Hartmann, Dept. Agricultural and Food Market Research Institute for Food and Resource Economics University of Bonn; Milan Tatic, Dept. Agricultural and Food Market Research Institute for Food and Resource Economics University of Bonn

ABSTRACT

This study examines consumer responses to implementation of dynamic pricing technology combined with digital price labels in the fresh food retail sector. The research focuses on analyzing how shelf life-based price adjustments influence sales rates before its expiration. We model consumer purchasing decisions for perishable goods, considering the interplay between price and perceived quality, which diminishes as shelf life decreases. The study also evaluates the potential for dynamic pricing to drive “cannibalization”. By examining these dynamics, the study sheds light on trade-offs involving retailer revenue, cross-product effects, and the broader implications for food waste reduction.