AI In Dynamic Pricing: Strategy and Consumer Perception

Abstract: Dynamic pricing has become a crucial difference for companies looking to increase client engagement and boost sales in the quickly changing e-commerce market. This study examines the use of artificial intelligence (AI) by AMAZON, one of the top e-commerce sites in India, to deploy dynamic pricing on a large scale .AI helps change how prices are set in digital commerce with immediate, flexible and customized pricing options. The study investigates how AI affects dynamic pricing with Amazon as an example. It looks at how machine learning and behavioural analytics are used to change prices according to demand, what is available and what customers are doing. Surveys, interviews and reviewing literature are used by the research to understand consumer attitudes towards AI-driven pricing when it comes to trust, fairness and satisfaction. Even though people like the benefits they get from AI, their major worries are about hidden data usage and rising prices. It is shown that following ethical rules in AI and clear discussions can boost consumer trust. It is found that for AI-enabled dynamic pricing to prosper, both the company’s goals, ethical values and what consumers expect must be considered.