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 strategies.
On Tuesday, eight companies—Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros—received subpoenas from the FTC. The agency is seeking insights into how these pricing practices may affect privacy, competition, and consumer protection.
Through tools such as AI, businesses utilize a method referred to as “surveillance pricing” or “dynamic pricing,” which allows them to display varying prices for the same products depending on individual customer profiles. Factors influencing these price differences can include location, demographics, credit history, and online shopping behaviors.
Many of the firms targeted by the FTC offer transaction and pricing solutions to some of the largest businesses in the United States and worldwide. Task Software manages transactions for numerous major hospitality clients, including McDonald’s and Starbucks, while Revionics supplies pricing optimization technology to major retailers like Home Depot. Pros, which specializes in AI-driven pricing solutions, serves clients such as Nestlé, HP, and United Airlines, and collaborates with Microsoft for technology development.
The FTC aims to uncover details about what it describes as an “opaque market” that segments shoppers and adjusts prices based on this categorization.
“Businesses that collect extensive personal data from Americans may threaten consumer privacy. There is a risk that companies are using this detailed information to impose higher costs on consumers,” stated FTC Chair Lina Khan. “Americans deserve clarity on whether companies are utilizing comprehensive consumer data to implement surveillance pricing, and the FTC’s inquiry aims to illuminate this unclear network of pricing intermediaries.”
The FTC’s investigation is focused on four main areas: the types of surveillance pricing technologies each company offers, their data collection methods, relevant customer and sales data, and the impact of these surveillance strategies on the final prices consumers pay.