Prof. Dr. h.c. mult. Hasso Plattner

Dynamic Pricing on Online Marketplaces: Strategies and Applications

General Information

Short Description

E-commerce is everywhere. Markets have become more transparent and competitive. Products and competitors’ offers can be easily compared. It has become easy and almost costless to adjust prices. For sellers “dynamic pricing” offers many opportunities and is therefore more and more used. However, smart pricing strategies are hard to determine.

In this seminar, we learn how to compute dynamic pricing strategies. Based on data-driven approaches we will use simple regression models to quantify demand and to estimate sales probabilities (real-life data from the Amazon market place is available). We will also take a look at theoretical optimization models that can be solved using dynamic programming techniques. Finally, we will use simulation techniques to evaluate the performance of different strategies.

Goals of the Course


  • opportunities and challenges of dynamic pricing
  • dynamic programming methods
  • demand learning under competition
  • response strategies


  • work in small teams
  • implement algorithms, simulate sales processes, visualize results


  • mathematical, analytical and modelling skills
  • optimization techniques


  • the participants should be interested in mathematical methods
  • the number of participants is restricted to 25

Teaching and Learning Process

The course is a combination of a lecture and a practical part:

  • teachers impart relevant knowledge
  • students work on a self-containing topic in a team of max 4 people
  • students regularly present their work
  • every team creates a prototype


  • 30% Presentations
  • 30% Project Results
  • 30% Project Documentation
  • 10% Personal Engagement

  • Project A: MPet, NP, SR, JS
  • Project B: RB, HD, SO, DS
  • Project C: NR, JF
  • Project D: SG, MPer, JR, PS