U.S. regulator targets personalised pricing as consumers worry about price hikes

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The U.S. Federal Trade Commission (FTC) is focusing on personalised pricing practices, and planning to aggressively enforce laws requiring sellers to inform customers if they are being shown different prices from others.

The U.S. FTC also wants businesses to disclose why personalised pricing is being used, and what customer data was collected in order to make these pricing decisions, in an effort to ensure lawful competition and transparency.

The U.S. regulator that focuses on consumer protections and fair business practices noted that the public and the government were “increasingly concerned that the massive amount of data collected and generated when consumers use modern technology is making it possible for merchants to personalise prices for goods and services that traditionally did not vary from person to person.”

The regulator defines personalised pricing as the “use of personal data to set prices according to the amount that a company believes an individual consumer is willing to spend.”

Personalised pricing is also called price discrimination, since it can involve offering different prices to different customers based on information that the seller has collected about them. ‘Surveillance pricing’ is another term that is sometimes used to describe this act, especially when online sellers track buyers’ internet activity in order to sell a product or service at the highest possible price they believe the user may pay.

Source: Read the original article on www.thehindu.com