Abstract:
The present invention takes an input of the acceptable pricing to volume points from a business and outputs a continuous function which interpolates the pricing information for the entire range of customer volumes. As each consumer agrees to purchase an offer, they are added to the group, and the price decreases as defined by the output function. The result of this model is that of consumer collusion; it is in each consumer&#39;s best interest to increase the volume of purchases for the offer by the business. This yields lower prices for the individual, incentivizing each consumer to advertise for the business making the offer.

Description:
CROSS-REFERENCE TO RELATED APPLICATIONS 
       [0001]    This application is a continuation of and claims benefit under 35 U.S.C. §120 of U.S. patent application Ser. No. 13/625,870 filed on Sep. 24, 2012, which is claims the benefit under 35 U.S.C. §119(e) of U.S. Provisional Application No. 61/538,828 filed on Sep. 24, 2011, the entire contents of which are incorporated herein by reference. 
     
    
     STATEMENT REGARDING FEDERALLY SPONSORED RESEARCH AND DEVELOPMENT 
       [0002]    Not Applicable. 
       FIELD OF THE INVENTION 
       [0003]    This invention relates generally to a perpetually decreasing group pricing system, and more particularly, to a system for defining discounted prices as a function of consumer purchase volume in a group discount setting. 
       DISCUSSION OF RELATED ART 
       [0004]    A pricing system is defined as any method which affects the distribution of goods or services by employing the use of price and money. Generally, pricing systems comprise two basic forms: the fixed price system and the free price system. Capitalist societies use the free price system, in which the price varies and purchases are generally dictated by the law of supply and demand. 
         [0005]    The first law of supply and demand states that in an environment with fixed supply, an increase in demand will cause an increase in purchases and transactions. General economic theory states that an increase in purchase volume can be attained by increasing market share within a constant sized market, or increasing market size as a whole. 
         [0006]    The group purchase model, made popular by Groupon™, attempts to increase demand by allowing consumers to leverage their purchasing power together in order to encourage a business to lower its prices. The effects of this are accepted by both the business and consumer because they each see their best interests served; the business has an increase in volume of purchases at the cost of an acceptably lowered price point, while the customer has a decrease in price in exchange for being a member of the group. 
         [0007]    While the group purchase model has been successful, there are potential pitfalls and room for improvement. In its current form, if the consumer volume for a particular offer reaches a point magnitudes higher than the offer price, the price remains the same. This negatively affects customers who do not receive a lower price commensurate with their increased bargaining position. Therefore, a need exists for a group purchase model whose price declines as more buyers place orders, thus increasing the bargaining position of the group. 
       SUMMARY OF THE INVENTION 
       [0008]    Current pricing models are essentially limited by their discrete nature. The present invention implements a group purchase model whose price declines as more buyers place orders, thus increasing the bargaining position of the group. As such, businesses are no longer exposed to the risks of lowered price without increased volume, and consumers are no longer limited to a discrete price point independent of their overall bargaining position. 
         [0009]    The present invention takes an input of the acceptable pricing to volume points from a business and outputs a continuous function which interpolates the pricing information for the entire range of customer volumes. As each consumer agrees to purchase an offer, they are added to the group, and the price decreases as defined by the output function. The result of this model is that of consumer collusion; it is in each consumer&#39;s best interest to increase the volume of purchases for the offer by the business. This yields lower prices for the individual, incentivizing each consumer to advertise for the business making the offer. 
         [0010]    Further incentives for purchasing a given offer can be found in the implementation of a guessing game. Each offer is given during a timeframe determined by the business, and the consumer is offered a chance to guess the final price of the offer at the end of this time frame. The first consumer to accurately guess the ultimate price of the offer can be rewarded, for example, by having their purchase be made free. This encourages consumers to entertain multiple purchases on an offer in addition to attempting to recruit more consumers for their desired offer. 
         [0011]    A costumer recognition platform within the present invention allows for the most recent consumer to have their name displayed as the user who “most recently lowered the price for everybody.” This further incentivizes purchases, by adding perceived value to each individual consumer. The consumers also gain an amount of control over what their ultimate price will be on an offer, which is missing from the previously mentioned pricing models. 
         [0012]    These and other objectives of the present invention will become obvious to those of ordinary skill in the art after reading the following detailed description of the preferred embodiments. It is to be understood that the foregoing general description and the following detailed description are exemplary, and are intended to provide further explanation of the invention as claimed. 
     
    
     
       DESCRIPTION OF THE DRAWINGS 
         [0013]      FIG. 1  is a diagram schematically illustrating a network wherein the server and client machines are connected; 
           [0014]      FIG. 2A  is a diagram schematically illustrating the modules of the perpetually decreasing group pricing system; 
           [0015]      FIG. 2B  is a diagram schematically illustrating the data points of the perpetually decreasing group pricing system; 
           [0016]      FIG. 3  is a flowchart illustrating the perpetually decreasing group pricing system; 
           [0017]      FIG. 4A  is a flowchart illustrating the perpetually decreasing group pricing system; 
           [0018]      FIG. 4B  is a flowchart illustrating the perpetually decreasing group pricing system; 
           [0019]      FIG. 5  is a diagram schematically illustrating a computer system utilized by the perpetually decreasing group pricing system. 
       
    
    
     DETAILED DESCRIPTION OF THE PREFERRED EMBODIMENT 
       [0020]    Illustrative embodiments of the invention are described below. The following explanation provides specific details for a thorough understanding of and enabling description for these embodiments. One skilled in the art will understand that the invention may be practiced without such details. In other instances, well-known structures and functions have not been shown or described in detail to avoid unnecessarily obscuring the description of the embodiments. 
         [0021]    Unless the context clearly requires otherwise, throughout the description and the claims, the words “comprise,” “comprising,” and the like are to be construed in an inclusive sense as opposed to an exclusive or exhaustive sense; that is to say, in the sense of “including, but not limited to.” Words using the singular or plural number also include the plural or singular number respectively. Additionally, the words “herein,” “above,” “below” and words of similar import, when used in this application, shall refer to this application as a whole and not to any particular portions of this application. When the claims use the word “or” in reference to a list of two or more items, that word covers all of the following interpretations of the word: any of the items in the list, all of the items in the list and any combination of the items in the list. 
         [0022]    In an economic environment comprising a business and consumer(s), the present invention  100  creates a group purchase model  300  whose price declines as more buyers place orders, thus increasing the bargaining position of the group. This involves receiving price and volume data points  302  from the business, accepting sales orders from buyers  306 , and offering an interface to display current pricing and volume during a specified time frame  326 . This is accomplished using an interpolation module  202 , a purchase tracking module  204 , a transaction module  206 , and an interface module  208 . These modules work in conjunction to create an automated interactive pricing model  300  in the group purchase dynamic over a specified time frame. 
         [0023]      FIG. 1  depicts a block diagram of a computer system  100  suitable for implementing aspects of the present invention. As shown in  FIG. 1 , computer system  100  includes the perpetually decreasing price system  102 , which interconnects major subsystems such as an API server  118 , web server  120 , application server  122 , and database server  126  having a storage means  522 . The application server  122  consists of several modules  124 , and a database  128  exists on the database server  126 . The perpetually decreasing price system  102  connects to client machines  106  and  108 , as well as 3rd party servers  114 , through a network  104 . Web clients  110  and programmatic clients  112  exist on the client machines  106  and  108 , respectively, and 3rd party applications  116  that exist on the third party server  114 . 
         [0024]    The interpolation module  202  will receive the data input  302  from the business and return the interpolation function  304  for prices as compared to customer volume. The interpolation module  202  will receive, from the business, a set of 3 or more data points  302  comprising price and volume pairings  224 . These data points  224  comprise the retail price  210 , tipping point  214 , midway point  216 , and manufacturing price  212  and volume points. Alternatively, the retail  210  and manufacturing  212  price can be expressed as extreme values for the maximum  210  and minimum  212  price and volume points. The tipping point  214  is the price before which the buyers are not committed to buy and the seller is not committed to sell  318 . The midway point  216  is the price where a substantial number of customers have made purchases and the purchase price will not fall dramatically as sales continue. 
         [0025]    These points  224  are received by the interpolation module  202 , which outputs a continuous interpolation function  304  to determine a price to volume relationship. The business can then implement this pricing model on an interactive platform accessed by the customer(s) with a timeframe determined by the business  300 . The interpolation algorithm relies on exponential approximations between each of the data points  224 , while ensuring the asymptotic decay remains above the minimum price point  212  provided by the business. An optimization process can also be used to smooth this function to its desired level of continuity. 
         [0026]    In an alternative embodiment, the business many input any number of specified price to volume points  224  between the maximum  210  and minimum  212  price values. Each point  224  can then be used as to calculate an exact exponential interpolation  304  between the maximum price  210 , minimum price  212 , and the given price point. The function which lies below all specified input price points will then be selected as the optimal price to volume function, which eliminates all discontinuities of higher order. 
         [0027]    In a further alternative embodiment, the algorithm could implement exponential interpolation for only the final two points to ensure acceptable asymptotic behavior. The remaining points can be calculated using spline interpolation of a desired degree, or similar polynomial approximations from numerical analysis. This method can ensure that the desired degree of continuity can be achieved while still fitting exactly within the desired price points inputted by the business. 
         [0028]    The purchase tracking module  204  will receive and store the list of consumers who have purchased the offer during the active timeframe  306 , as well as their purchasing data. Alternatively, the purchase tracking module will record the price tier of each consumer when the purchase is made, as well as the total number of consumers in the purchasing group during the active timeframe. The purchase tracking module will further calculate a total purchase count  308 , a current purchase price  310 , and a future interpolated price  312 , as well as store purchase data for the tipping point buyer  320  whose purchase reduces the current purchase price to the tipping point. In the preferred embodiment, the active timeframe will comprise 1 day, although any timeframe can be used. 
         [0029]    The transaction module  206  will receive data from the purchase tracking module  204  to provide the final number of group members who have purchased the offer  308 . Data from the interpolation module  202  can then be used to calculate the final price  322 . All users listed in the purchase tracking module  204  will then be charged the final price  322  and informed of the transaction at the end of the timeframe, so long as the tipping point  214  has been satisfied. In an alternate embodiment, each purchaser will be charged the price of the price tier they were in when the purchase was made. In a further alternative embodiment, each purchaser will be charged their original purchase price, as calculated by the interpolation module  202 . 
         [0030]    The interface module  208  will access data from the above modules to create a display to inform consumers of the current count of buyers that have purchased the offer, current purchase price for all users involved, and the future interpolated prices if more users are added to the purchasing group  326 . The buyer count is received from the purchase tracking module  204 , while other values are received from the interpolation module  202 . The current and future interpolated prices  304  can be calculated and displayed to a decimal point greater than two  414  to further incentivize purchases during high-volume sales. 
         [0031]    This interface can interactively be shown on the business website or a third party site on which the main advertising occurs. Included in this display is the buyer who introduced the deal  412 , the buyer who satisfied the tipping point  320 , and the most recent consumer&#39;s name and purchase price  326 , which becomes the price that is applied to all previous and future consumers of the service or goods during the timeframe. 
         [0032]    In addition to the pricing model, the present invention offers an incentivized guessing game  400 . Upon the time of purchase, the consumers are given an input field to predict the price estimated price of the service or goods at the expiration of the timeframe  402 . This data is stored by the purchase tracking  204  module for reference after the timeframe as elapsed. The first consumer in the database to accurately predict the final price  402  determined by the interpolation module  202  is given a prize provided by the business  410 . This prize is suggested by the present invention to be their purchase for free, but variants can be explored. This buyer may also be included in the interface module display. 
         [0033]    The above detailed description of the embodiments of the invention is not intended to be exhaustive or to limit the invention to the precise form disclosed above or to the particular field of usage mentioned in this disclosure. While specific embodiments of, and examples for, the invention are described above for illustrative purposes, various equivalent modifications are possible within the scope of the invention, as those skilled in be applied to other systems, not necessarily the system described above. The elements and acts of the various embodiments described above can be combined to provide further embodiments. 
         [0034]    Changes can be made to the invention in light of the above “Detailed Description.” While the above description details certain embodiments of the invention and describes the best mode contemplated, no matter how detailed the above appears in text, the invention can be practiced in many ways. Therefore, implementation details may vary considerably while still being encompassed by the invention disclosed herein. As noted above, particular terminology used when describing certain features or aspects of the invention should not be taken to imply that the terminology is being redefined herein to be restricted to any specific characteristics, features, or aspects of the invention with which that terminology is associated. 
         [0035]    While certain aspects of the invention are presented below in certain claim forms, the inventor contemplates the various aspects of the invention in any number of claim forms. Accordingly, the inventor reserves the right to add additional claims after filing the application to pursue such additional claim forms for other aspects of the invention.