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FTC says "personalized pricing" based on consumer data could violate the law
CBS News • • business
Key Points:
- The Federal Trade Commission (FTC) warned companies that use customers' personal data to set individualized prices without disclosure may be violating federal law by engaging in deceptive practices.
- The FTC emphasized consumers expect uniform pricing for products and services rather than prices fluctuating based on browsing history, purchase behavior, or perceived willingness to pay.
- While the FTC cannot ban personalized pricing outright, it can take action against businesses that fail to clearly disclose how personal data is used to determine prices.
- Examples of potentially unlawful personalized pricing include charging higher prices based on household composition, perceived trip necessity, or medical emergencies inferred from data.
- Consumer advocates support the FTC's efforts, highlighting concerns about fairness and transparency, especially for less-informed shoppers who may be unaware of or unable to avoid such pricing practices.
