Theme：Is Target Pricing Profitable? When Ratchet Effect Meets Big Data

Guest Speaker：Jianhu Zhang (Shandong University)

Time：December 5th, 2025(Friday)，14:00-15:15 pm

Venue：Room 214, Business School Building

Organizer：The Department of Economics

Guest Bio:

  Jianhu Zhang is a professor and doctoral supervisor at the School of Economics, Shandong University, and a Young Expert of the Taishan Scholars Program of Shandong Province. His research focuses on industrial organization theory. He has published over 20 papers in journals such as the International Journal of Industrial Organization, Oxford Economic Papers, Canadian Journal of Economics, and China Economic Quarterly. He has led one Young Scholar Project and two General Projects of the National Natural Science Foundation of China.

Synopsis：

  This paper analyzes how advances in data analytics affect the trade-off between personalization and commitment in dynamic pricing. We build a model of a seller interacting with heterogeneous, forward-looking consumers and show that higher data precision can offset the ratchet effect, thereby restoring the profitability of target pricing. Specifically, when segmentation reaches four or more consumer groups, target pricing outperforms uniform pricing. Moreover, consumer and social welfare are enhanced through market expansion, reflecting the broader benefits of data‑driven pricing. These results highlight how improvements in information capabilities reshape optimal pricing strategies and offer new insights into data-driven decision-making in digital markets. We further test the robustness of our results under asymmetric time preferences and skewed consumer valuations, and explore the seller’s incentives to invest in data analytics.