The Federal Trade Commission (FTC) has initiated an investigation into several prominent companies regarding their use of customer data, algorithms, and artificial intelligence for personalized pricing.
Eight companies, including Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros, received requests for information from the FTC on Tuesday. The agency aims to understand how these pricing practices affect privacy, competition, and consumer protection.
These companies utilize data tools and techniques known as “surveillance pricing” or “dynamic pricing,” which allows them to display varying prices for identical products based on factors such as consumer location, demographics, credit history, and online shopping behavior.
Many of the firms contacted provide sales and pricing services to a broad range of significant businesses in the U.S. and worldwide. Task Software manages transactions for major hospitality brands, including McDonald’s and Starbucks. Revionics specializes in retail price optimization software and supports various global chains, such as Home Depot. Pros, which promotes its AI-driven pricing solutions, lists clients like Nestlé, HP, and United Airlines, and collaborates with Microsoft on technology development.
The FTC intends to investigate this complex market that categorizes consumers and establishes targeted pricing strategies.
“Companies that collect personal data from Americans may jeopardize people’s privacy. There is a risk that firms could exploit this extensive data to impose higher prices,” stated FTC Chair Lina Khan. “Americans deserve transparency on whether companies are utilizing detailed consumer information for surveillance pricing, and the FTC’s inquiry aims to clarify this obscure pricing ecosystem.”
The FTC is seeking information in four primary areas: the surveillance pricing products and services offered by each company, methods of data collection, customer and sales data, and the impact of these practices on the prices consumers ultimately pay.