Is Lululemon Flirting with Dynamic Pricing?

Dog Runner Pant, currently $69, were $49 earlier today

Run with Rover Pant, bouncing between $49 to $69

Lulu buyers who've been keeping an eye on the Dog Runner and the Run With Rover Pants have noticed the markdown prices bouncing up and down lately. The Dog Runners were $49 earlier this morning but are now sitting at $69 in the We Made Too Much section. The Run with Rover pants first hit WMTM at $49, then got marked up to $69, were reduced to $59 and are sitting at $49. Is lululemon flirting with dynamic pricing of its markdown section? I know my husband has experienced this when he's hunting certain electronics for the price he wants to pay but it's interesting we are seeing it with clothing, too. I know I have experienced a form of it in the store before and I did see it happen over Black Friday weekend. The first cut markdowns hit on Black Friday and then the really low markdowns were made two days later on Sunday. Later in the week the prices were back up to the first cut level again and after a week or two the sale racks disappeared altogether. I've also seen it before with random markdowns. I remember I passed on a lone Ta Ta Tamer at $39 one time a couple of years ago. After thinking about it a few days I went back to get it and it was back up to full price and they had a full size run in the color. That taught me to jump on an item if the price was right. That is one of the purposes of dynamic pricing after all, teaching you to jump on the deal that you can live with. A couple of interesting quotes from the linked article:

"They're experimenting," notes Daniel Green, president of Cosmic Shovel Inc., which owns price tracking site camelcamelcamel. "They will raise the prices, seeing if people will purchase, then they'll drop them back down... They're testing the waters to see what people are willing to pay."
Mohammed, the consultant, adds: "What they're really trying to do is find pockets of opportunity, where they can change the price to make the highest profit margin or sell the most amount of products."

Interesting paragraph on the pitfalls of dynamic pricing. Good quote: "Consumers who pay higher prices for a new phone or appliance will feel cheated as they see prices go down on something they just bought. Apple experienced this backlash with its iPhone when it dropped prices by $200 just a few weeks after launch in 2007. They had to make amends with consumers."  That is exactly what we saw happen today when the Boxing Day prices got slashed late last night. People were pissed and lit up the lululemon Facebook page.