Introduction Numerous companies have embraced this trend of price segmentation through the Web. The internet has made variable pricing an option for many companies. The Practice Dynamic pricing is advantageous to the retail owner because it brings in place the key objectives of growth and profit for any retail entity. Through price variation, the vendor is able get a suitable price for the product in relation to the profit margins. The practice is a key characteristic in e commerce because it allows the price of an item to fluctuate due to different conditions within the market. Supply and demand dictate on how an item is going to be priced. Constant analysis of the supply and demand chain is done so that suitable price adjustments can be made. IBM currently adjusts prices on some computers models according to consumer demand and also product life cycle. When the demand increases then the retailer increases the price for the items. If there is a decrease in demand the prices are reduced so as to encourage more purchases. Dynamic pricing encourages impulse buying and repeat sales of certain items. Monitoring From the data that the retailer collects, the consumer can be able to always monitor the future availability of the product and also it’s pricing. This will mean that the suppliers will be able to priorities on the products that move and ensure the prices that are set encourage sales. The practice also encourages brand awareness through the repeat sales of products. A wider consumer base can be reached because the different market segments can easily access the product. The retailer has the advantage of getting real-time information about market forces. With this information companies can view the outcome of sales and marketing activities. This will also help the company to monitor the movement of products thus ensuring that all the products are moved from the stores. The practice enhances the movement of dead stock or items that would otherwise be considered as being out of vogue. These items can be priced in such a way that they can be sold hence improved sales for the retailer. It would also mean that the retailer will order for products that are moving according to the inventory. Negative Impact of Dynamic Pricing Amazon.com introduced this system of pricing on its customers. The customers were segmented according to where they lived and by how much they had spent on there past purchases. This factor outraged the consumers and brought a lot of anger to them. This mode of pricing is disadvantageous to consumers and the general public who have a negative perception. Conclusion In conclusion, dynamic pricing is therefore a strategy used by many companies to trade their goods online. It involves charging different prices for the same product and this is dependent upon the ability of the consumer to pay for the product. A company such as Dell must embrace dynamic pricing in order to realize huge profits by selling its products at higher prices in the markets where consumers are ready to purchase the products and low prices for the unfavorable markets. However, the risks involved in dynamic pricing must be taken into consideration even as companies sell their products online.