Dynamic pricing or price optimization is the concept of offering goods at different prices which varies according to the customer’s demand. The pricing of the commodity can be done on the basis of competitor’s pricing, supply, demand and conversion rates and sales goals. The practice of Dynamic Pricing is being widely adopted in E-Commerce.
Machine learning algorithms should be able to efficiently automate pricing decisions to maximize proﬁts, as they can perform pricing decisions using sophisticated calculations and predictions, by putting all available data into perspective, and change their pricing strategy to best adapt to a dynamic environment.
Consequently, a considerable amount of research trying to solve these hard pricing problems by machine learning has been performed, and many predict that pricing done by machine learning algorithms is the future of pricing