System offers better deals at end of a line

By PETER GRIFFIN

Christchurch-based software developer My Price is running trials on a Wap-based marketing service it claims will help businesses shift goods that usually gather dust on shelves - and give consumers better deals.

The company, headed by German engineer David Post, is aiming to use widely available technology to match supply with demand more closely.

The system is underpinned by computer algorithms that calculate a price dependent on a range of variables rather than fix a price based on market research.

In the case of air travel, the algorithms are based on what time of year a passenger wishes to take a flight, how far in advance he or she is booking and the estimated demand for seats.

"Flexible" customers - those who could book air travel well in advance - would find the service most useful.

The airline industry is a logical starting point for Mr Post, who worked in sales for Lufthansa for 10 years.

Mr Post said that, on average, New Zealand airlines were running at 70 per cent of capacity before the September 11 terrorist attacks on the US.

Though they were willing to fill empty seats at cut prices, they were less willing to advertise drastically reduced airfares.

"If these companies can increase revenue by just 5 per cent, in some cases that can lead to a doubling in profits," said Mr Post. Bryan Gould, vice-chancellor of Waikato University and a former leading Labour politician in Britain, is adding weight to the venture. Mr Gould has joined My Price as the company's chairman.

Freedom Air has expressed interest in the system, but My Price is yet to clinch a deal that would allow the service to make its commercial debut.

However, Mr Post said the system could be applied to any industry where companies faced varying levels of demand throughout the year, from footwear retailers to travel agents.

Users would access the service through a web browser or via their Wap-enabled (wireless application protocol) mobile phone, entering criteria into predefined fields.

Users could also be given the option of making the purchase through their mobile phones.

"That's why it's so important to have the likes of Telecom and Vodafone on board, because they act as banks clearing transactions, and get a cut in the process," Mr Post said.

Mr Post, who is financing My Price himself, said the patented sales method employed in the service would be taken overseas if successful.

"New Zealand is a perfect place to get the model right, before taking it to a bigger market."

My Price