If the AI keeps lowering prices to capture your market share, you can easily get caught in a price war that spirals out of control if you try to beat their price. If you keep matching the AI price, the AI will often keep lowering prices until you are both selling all the goods that you can move, but no one can make a decent profit on that product.
As soon as I notice that an AI has started selling a product in competition with me, I set prices on that product to produce an overall rating one point lower than the AI's overall rating. In other words, their product will always have a +1 overall rating compared to my rating. This seems to stop them from continuing price drops, and you don't lose much (if any) market share.
It also slows AI sales growth way down, as long as you catch it early.
Price Wars with the AI
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WilliamMGary
- Level 9 user
- Posts: 1052
- Joined: Mon Nov 12, 2012 8:00 pm
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applemachine
- Posts: 9
- Joined: Mon Dec 02, 2013 5:47 am
Re: Price Wars with the AI
AI are a suicidal bunch. In my current game I seem to have an arch nemesis who has the same expertise as me. We are both basically cannibalizing each other in the home appliance industry. It's great fun but it's pretty tough to deal with this guy who won't give up EVER. He pushed my market share of air conditioners down even though my quality was 10 points higher and my brand was 90 points higher. He lowered his price to such a low point for so long.
I may have made a mistake by selling his washing machines and basically funded his sleazy underpricing strategy. But dam it worked. I've even made some pretty drastic measures to integrate vertically. Hopefully it provides the profits to turn the screws on this guy... either that or diversify elsewhere and let this guy do whatever... then come back and buy him out and add to my own business.
It seems the AI is well programmed. The challenge is definitely there if you go head to head in an industry. I've only played a few games so far but it seems that the retail IE tend to always disappear. I have not paid enough attention to know for sure if they have been switching to 'diversify' or if they have been merged, but I think the latter has been more prevalent. The competition amongst retail AI is insane.
I may have made a mistake by selling his washing machines and basically funded his sleazy underpricing strategy. But dam it worked. I've even made some pretty drastic measures to integrate vertically. Hopefully it provides the profits to turn the screws on this guy... either that or diversify elsewhere and let this guy do whatever... then come back and buy him out and add to my own business.
It seems the AI is well programmed. The challenge is definitely there if you go head to head in an industry. I've only played a few games so far but it seems that the retail IE tend to always disappear. I have not paid enough attention to know for sure if they have been switching to 'diversify' or if they have been merged, but I think the latter has been more prevalent. The competition amongst retail AI is insane.
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kuztom
- Posts: 2
- Joined: Mon Dec 23, 2013 12:28 am
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WilliamMGary
- Level 9 user
- Posts: 1052
- Joined: Mon Nov 12, 2012 8:00 pm
Re: Price Wars with the AI
kuztom wrote:The easiest way to deal with a fierce competitor - buy them and merge.
