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Companies develop 'hi-tech' deals for consumers

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Some big-name companies are using computer-driven, “artificial intelligence” algorithms to crunch a whole lot of data and figure out how much to charge you at checkout. (Source: 3TV/CBS 5) Some big-name companies are using computer-driven, “artificial intelligence” algorithms to crunch a whole lot of data and figure out how much to charge you at checkout. (Source: 3TV/CBS 5)
Humans write pricing algorithms, and computers capable of adapting to changes in supply and demand help update prices in near real time. (Source: 3TV/CBS 5) Humans write pricing algorithms, and computers capable of adapting to changes in supply and demand help update prices in near real time. (Source: 3TV/CBS 5)
Experts predict it will be the pricing process more businesses use in the future. (Source: 3TV/CBS 5) Experts predict it will be the pricing process more businesses use in the future. (Source: 3TV/CBS 5)
Jonathan Volzke says he will continue to bargain hunt but would like to know that the prices he compares are the lowest of the low. (Source: 3TV/CBS 5) Jonathan Volzke says he will continue to bargain hunt but would like to know that the prices he compares are the lowest of the low. (Source: 3TV/CBS 5)
(3 ON YOUR SIDE) -

It’s new, it’s high-tech and it’s going to impact the amount you pay for things!

Pricing is going “futuristic.”

Some big-name companies are using computer-driven, “artificial intelligence” algorithms to crunch a whole lot of data and figure out how much to charge you at checkout.

How does it work? Can you still find the best deal?  What do regulators think about this?

Having what he wants simply show up on his doorstep is why Jonathan Volzke loves scouring the internet for deals.

“I can go to one site and see 10, 15, 20 of the same product at a different price point,” he says, “and I can generally find exactly what I want.”

We found shoppers like Volzke aren’t the only ones crunching competitors' prices.

Some major companies are doing it using artificial intelligence or AI software.

Humans write pricing algorithms, and computers capable of adapting to changes in supply and demand help update prices in near real time.

Attorney Maurice Stucke co-wrote two books on data and algorithm pricing.

“We're going from a world where people used to stamp the price on the product itself to a world where you're buying goods and services online or even offline, but a pricing algorithm now determines it,” says Stucke.

Experts predict it will be the pricing process more businesses use in the future.

“It's not a question of if, but more a question of when,” says Gary Liu from Boomerang Commerce.

Boomerang makes AI enabled software and says it creates a more competitive market.

“By having more and more retailers that are using this technology, the retailers are able to update prices at scale, in a timely, relevant way and more competition typically means consumers win in the long run,” says Liu.

Stucke is watching AI pricing algorithms with caution, concerned that we won't necessarily know when we get the best deal.

"We can't assume that the market forces by themselves will necessarily get us the right price,” he said.

An international economic council is meeting to discuss competitive “challenges raised by algorithms.”

The FTC is also watching this issue. 

Volzke says he will continue to bargain hunt but would like to know that the prices he compares are the lowest of the low.

“I was surprised to find out that the price is derived through some complicated formula versus just the cost of the product, the cost of stocking it, the cost of mailing it,” he said.

Experts say your best bet to find the best deal is to do your homework, comparing online as well as in-store and, of course, don’t forget those price comparison apps! 

Click/tap here to download the free azfamily mobile app.

Copyright 2017 KPHO/KTVK (KPHO Broadcasting Corporation). All rights reserved.


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Gary HarperGary Harper is the senior consumer and investigative reporter for 3 On Your Side at KTVK-TV.

Click to learn more about Gary.

Gary Harper
3 On Your Side

With more than 20 years of television experience, Gary has established himself as a leader in the industry when it comes to assisting viewers and resolving their consumer-related issues. His passion and enthusiasm have helped him earn an Emmy for Best Consumer Reporter from the National Academy of Television Arts and Sciences. He’s also garnered several Emmy nominations

He has negotiated resolutions with companies of all sizes, including some of the biggest corporations in the nation.

Gary has successfully recouped more than $1 million for viewers around the state, making 3 On Your Side one of the most popular segments on KTVK and the station's Web site.

He's best known for investigating and confronting unscrupulous contractors. In fact, many of his news reports have led to police investigations and jail time for those who were caught. Viewers, as well as the companies and people he investigates, regard him as consistently being thorough and fair.

Gary has been with KTVK-TV since 1997. Prior to his arrival in Phoenix, he worked for WZZM-TV in Grand Rapids, Michigan, where he was as an anchor and reporter.

Gary is from Chicago, but launched his television career in Lubbock, Texas, after earning a broadcast journalism degree from Texas Tech University. Following his graduation, he was quickly hired by KLBK-TV in Lubbock, where he enterprised and broke numerous exclusive reports. His aggressive reporting in Texas helped garner him Best Reporter by the Associated Press.

Gary has been married since 1994 and is the proud father of two sons. When he's not helping viewers, Gary is busy catching up on his favorite college and professional football teams as well as cheering on his beloved Texas Tech Red Raiders.

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