The Federal Trade Commission (FTC) has initiated an investigation into several major companies regarding their use of customer data, algorithms, and artificial intelligence to customize pricing.
On Tuesday, the FTC issued orders to eight companies, including Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros, to gather information about how these pricing strategies affect privacy, competition, and consumer protection.
These companies employ a method known as “surveillance pricing,” also referred to as “dynamic pricing,” which allows them to present varied prices to consumers based on specific characteristics and behaviors. Factors influencing these prices may include location, demographics, credit history, and browsing or shopping history.
Many of the firms contacted by the FTC provide transaction, sales, and pricing services to leading U.S. and international corporations. For instance, Task Software supports major hospitality brands like McDonald’s and Starbucks, while Revionics offers retail price optimization tools to global chains such as Home Depot. Pros, which specializes in AI-driven pricing solutions, lists Nestlé, HP, and United Airlines among its clients and collaborates with Microsoft as a technology development partner.
The FTC aims to clarify the workings of this “opaque market,” in which consumer categorization leads to targeted pricing strategies.
FTC Chair Lina Khan stated, “Firms that harvest Americans’ personal data can put people’s privacy at risk. Now firms could be exploiting this vast trove of personal information to charge people higher prices. Americans deserve to know whether businesses are using detailed consumer data to deploy surveillance pricing, and the FTC’s inquiry will shed light on this shadowy ecosystem of pricing middlemen.”
The FTC is seeking information in four main areas: the types of surveillance pricing products and services offered by each company, data collection methods, customer and sales information, and the influence of these practices on the final prices customers pay.