surveillance pricing

Recent media reports indicate that a growing number of grocery stores[1] and retailers may be using algorithms to establish targeted prices.[2] Advancements in machine learning make it cheaper for these systems to collect and process large volumes of personal data, which can open the door for price changes based on information like your precise location, your shopping habits, or your web browsing history.This means that consumers may now be subjected to surveillance pricing when they shop for anything, big or small, online or in person: a house, a car, even their weekly groceries.

Behind the FTC’s Inquiry into Surveillance Pricing Practices Henry Liu, Director of the Bureau of Competition 2024

The Federal Trade Commission issued orders to eight companies offering surveillance pricing products and services that incorporate data about consumers’ characteristics and behavior. The orders seek information about the potential impact these practices have on privacy, competition, and consumer protection.The orders are aimed at helping the FTC better understand the opaque market for products by third-party intermediaries that claim to use advanced algorithms, artificial intelligence and other technologies, along with personal information about consumers—such as their location, demographics, credit history, and browsing or shopping history—to categorize individuals and set a targeted price for a product or service. The study is aimed at helping the FTC better understand how surveillance pricing is affecting consumers, especially when the pricing is based on surveillance of an individual’s personal characteristics and behavior.

FTC Issues Orders to Eight Companies Seeking Information on Surveillance Pricing Henry Liu, Director of the Bureau of Competition 2024