Opportunities and Challenges in Using Online Preference Data for Vehicle Pricing: A Case Study at General Motors
P. Ruusmevichientong, J. A. Salisbury, L. T. Truss, B. Van Roy and P. W. Glynn
Journal of Revenue and Pricing Management 5(1), 45-61 (2006)
Developed by General Motors (GM), the Auto Choice Advisor web site (http://www. autochoiceadvisor.com) recommends vehicles to consumers based on their requirements and budget constraints. Through the web site, GM has access to large quantities of data that reflect consumer preferences. Motivated by the availability of such data, we formulate a non-parametric approach to pricing GM vehicles, highlight opportunities and challenges in using online data, and contrast our approach with existing methodologies and traditional data sources. Our analysis provides insights into the current pricing practice and suggests enhancements that may lead to a more effective pricing strategy.