I think we all agree that personalized pricing should be part of an overall 1 to 1 personalization strategy. I also think that personalized pricing should go hand in hand with 1 to 1 customer "experience." Retailers have to think about delivering personalized experience to the customers as part of their overall personalization strategy. Experience can be value or services, but it should be differentiating enough for each customer.
I believe that price bots, AI and Machine Learning-based advancements in the world of commerce are part of natural evolution of the ecommerce technology stack. They are hear to stay and they will play a significant part in (re)shaping the commerce landscape for all the parties involved in it -- retailers, brands & consumers.
First came price parity between online and in-store, next came price matching guarantees, and now pricing based on competitive data. Thanks to price bots, consumers now expect price parity across various retailers.
Dynamic pricing is a whole another topic. If you are using competitive pricing data as a major (in some cases ONLY) input to dynamic pricing and not think about the in-market consumers, then I agree dynamic pricing is the race to the bottom. I think this is where there is a huge potential for retailers and brands to differentiate themselves.
We all know that "not all consumers are created equal" so they should not be treated equal. Retailers and brands should fully embrace what the technology has to offer now (multi-dimensional clustering and segmenting of the consumers in real-time) and understand your customer before recommending dynamic pricing. It is important to understand that customers are willing to pay more (or less) provider you can meet their needs and expectations. This means dynamic pricing should include tiered value added services like expedited delivery (Uber, Instacart, etc.) and others in it.
My two cents: It is time to start thinking about dynamic pricing = pricing "Products as a Service."