Dynamic Pricing

The UK Competition and Markets Authority, in its 2025 update on dynamic pricing, describes dynamic pricing as prices being adjusted rapidly and frequently in response to demand.

In ecommerce, prices usually move on one of three inputs:

Demand. Prices rise when demand is high relative to stock and fall when it is low.

Stock and time. Prices fall as a season ends or stock ages, which overlaps with markdown pricing.

Competitors' prices. Rules such as "stay 2% below the cheapest competitor" or "never be more than 5% above the median" reprice products automatically when a competitor moves. This is the version competitor monitoring speaks to.

Dynamic pricing is a mechanism, not a position. It can be used to stay cheapest, to protect margin when competitors are out of stock, or to hold a premium within a set band.

If competitors reprice automatically, a cut on your side can trigger theirs within a day, and two sets of rules can chase each other down to the floor price. Knowing whether a competitor reprices often, and how far, tells you whether a price war is likely before you start one.

It also carries rules. The CMA says consumer law does not generally prohibit particular pricing or commercial strategies, dynamic pricing included, but suggests that where shoppers need it to make an informed decision, firms may need to tell them, for example, that prices can change and are not static. This is not legal advice.

This example is hypothetical. A beauty brand notices that a competitor's price on a comparable moisturizer changed eleven times in a month, each time landing just under the brand's own price within a day or two of the brand changing it.

That pattern suggests the competitor reprices against the brand automatically. The brand decides not to cut further on that product, because each cut would be followed, and instead competes with a gift with purchase that the competitor's pricing rule cannot match.

1. Record prices daily with a dated history. How often a price moves, and how far, is the evidence.

2. Compare moves with your own. If a competitor's changes follow yours within a day or two, they are probably repricing against you.

3. Look at the range, not the single price. A competitor whose price moves inside a narrow band is protecting margin; one that keeps hitting new lows is buying share.

4. Know your tool's cadence. RivalSweeper checks each monitored competitor site daily and keeps a dated price history, so a change is known within 48 hours. It is daily monitoring, not real-time, so it shows the pattern of a competitor's repricing, not every change within a day. It also does not reprice your products: it reports and alerts, and the pricing decision stays with your team.