Abstract

Due to its success and acceptance in the airline and hospitality industry and the growing availability of behavioral, engagement, and attitudinal consumer data, dynamic pricing strategies are gaining popularity. The purpose of this systematic literature review is to answer the research question about how do dynamic pricing strategies affect customer perceptions and behaviors to avoid negative consumer reactions. The synthesis of over 50 articles revealed eight different research streams like for example the factors moderating the impact of dynamic pricing on customer behavior, strategic purchasing behavior in response to dynamic pricing, effect of dynamic pricing on customer perception of fairness, personalized dynamic pricing (PDP) and channel differentiated pricing. To advance future research, this systematic literature review identified the six propositions for further research like for example the assessment of the efficacy of different types of communication by firms seeking to mitigate the negative impacts of dynamic pricing and the assessment of the role and relevant importance of consumers’ personal characteristics upon their perceptions of price changes. The findings of this study have a practical impact for managers and scholars. Scholars may use them to update their research agendas and managers to optimize their pricing strategies to increase revenues.

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