The Federal Trade Commission (FTC) has initiated an investigation into several major corporations concerning their use of customer data, algorithms, and artificial intelligence to personalize pricing strategies.
Eight companies across various sectors—Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros—received inquiries from the FTC seeking information on how these pricing techniques may affect privacy, competition, and consumer protection.
The investigation focuses on a practice known as “surveillance pricing” or “dynamic pricing,” where companies use data tools, including AI, to display different prices for the same products based on individual consumer characteristics and behaviors, such as location, demographic factors, credit history, and online shopping habits.
Many of these firms offer transaction, sales, and pricing services to some of the largest companies in the U.S. and worldwide. Task, for instance, manages transactions for several top hospitality brands, including McDonald’s and Starbucks. Revionics specializes in retail price optimization and provides pricing analytics for global retailers like Home Depot. Pros, which claims to deliver AI-driven pricing solutions, serves notable clients such as Nestlé, HP, and United Airlines and collaborates with Microsoft on technological developments.
The FTC aims to investigate the transparency of what it describes as an “opaque market” that profiles consumers and assigns targeted prices for goods and services.
FTC Chair Lina Khan stated, “Companies that gather extensive personal data can jeopardize individuals’ privacy. There is concern that these companies may be leveraging this data trove to set higher prices. Americans have the right to know if businesses are utilizing detailed consumer data for surveillance pricing, and this inquiry will clarify the unclear landscape of pricing intermediaries.”
The FTC’s investigation will delve into four primary areas: the types of surveillance pricing products and services offered by each company; methods of data collection; customer and sales information; and the influence of these practices on the final prices paid by consumers.