The Federal Trade Commission (FTC) has initiated an investigation into several major corporations regarding their use of customer data, algorithms, and artificial intelligence in relation to personalized pricing strategies.
The inquiry includes eight companies from various sectors—Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros. These firms have been ordered to provide information on how their pricing practices affect privacy, competition, and consumer protection.
Many companies employ a pricing strategy known as “surveillance pricing” or “dynamic pricing,” where different prices are shown to consumers for the same products based on personal attributes like location, demographics, credit history, and shopping behavior.
The firms under scrutiny often provide transaction, sales, and pricing services to major U.S. and global businesses. For example, Task Software is linked with significant hospitality brands such as McDonald’s and Starbucks, while Revionics offers retail pricing solutions to well-known retailers, including Home Depot. Additionally, Pros, known for its AI-driven pricing solutions, lists notable clients like Nestlé, HP, and United Airlines, and collaborates with Microsoft on technology development.
The FTC aims to clarify this “opaque market” that segments shoppers and sets targeted prices. FTC Chair Lina Khan expressed concerns regarding the potential privacy risks posed by companies that collect personal data, suggesting that this information may be exploited to impose higher prices on consumers. She emphasized that the inquiry seeks to uncover whether businesses are using detailed consumer data to engage in surveillance pricing and to better understand the complex web of pricing intermediaries.
The regulatory agency is particularly interested in four areas: the types of surveillance pricing products and services offered, methods for data collection, customer and sales data, and the impact of these surveillance practices on the prices consumers ultimately pay.