The Federal Trade Commission (FTC) has initiated an investigation into several major companies regarding their use of customer data, algorithms, and artificial intelligence for personalized pricing strategies. The inquiry specifically targets eight firms, including Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros, which were issued information requests by the FTC on Tuesday.
These companies are being examined for how their practices impact privacy, competition, and consumer protection. They utilize data tools and techniques referred to as “surveillance pricing” or “dynamic pricing,” which allow them to present varying prices to consumers based on specific traits or behaviors such as location, demographics, credit history, and past shopping habits.
Many of the firms involved play significant roles in providing transaction, sales, and pricing services to some of the largest businesses in the U.S. and internationally. For example, Task is known for its transaction management solutions for major hospitality brands like McDonald’s and Starbucks, while Revionics offers pricing software and analytics to big retailers like Home Depot. Additionally, Pros, which specializes in AI-driven pricing solutions, serves high-profile clients such as Nestlé, HP, and United Airlines, and partners with Microsoft for technology development.
FTC Chair Lina Khan emphasized the agency’s concerns about the potential risks to consumer privacy posed by companies that collect extensive personal data. She highlighted the need for transparency, stating, “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 specifically seeking insights into four main areas: the types of surveillance pricing services offered by each company, their data collection methods, information about customers and sales, and the ways in which these practices affect the prices consumers ultimately pay.