Economics
Are you “Willing” to Pay More?
Companies can exploit personal data to alter prices for individual customers
Recently, I was in New York for a layover and had booked a moderate hotel for the evening. Upon check-in, the concierge explained that there would be a resort fee. I looked around the cubicle-sized lobby for the palm trees and pool. Then I asked,” So, what exact resort amenities are there to enjoy?”
He grinned and said, “There’s free breakfast.”
I raised an eyebrow and gave a half-cocked grin. I wondered, wasn’t breakfast already included with the room fee? In any case, I would make sure to get my money’s worth of flavorless coffee refills and stale croissants.
Although it didn’t make any logical sense to pay a resort fee, where no resort existed, I was in New York City at the height of summer and thus expected to pay more for less.
Most of us anticipate the costs of airline tickets, hotels, or transportation services to rise when demands for those services are high, such as during the summer or over the holidays. That is to say, all of us expect to pay a higher price for the same service or product during surges in demand.
