The Federal Trade Commission (FTC) has initiated an investigation into several major companies regarding their use of customer data, algorithms, and artificial intelligence to set personalized pricing. The companies under scrutiny include Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros, all of which received requests for information from the FTC aimed at assessing the effects of such pricing practices on privacy and consumer protection.
Many companies utilize advanced data tools, including AI, to implement a pricing strategy known as “surveillance pricing,” which allows them to display different prices for identical products based on factors such as consumer location, demographics, credit history, and online behavior.
The firms investigated provide essential transaction, sales, and pricing services to numerous prominent corporations in the U.S. and worldwide. Notably, Task Software manages transactions for major hospitality names like McDonald’s and Starbucks. Revionics specializes in retail price optimization and analytics, serving global chains like Home Depot, while Pros offers AI-powered pricing solutions to clients such as Nestlé, HP, and United Airlines, and collaborates with Microsoft on technology development.
The FTC aims to clarify this “opaque market” where customers are categorized, often leading to targeted pricing. FTC Chair Lina Khan emphasized the risks posed by companies that leverage personal data, cautioning that such practices could result in consumers facing inflated prices. The commission’s inquiry seeks to uncover whether businesses are indeed utilizing detailed consumer information for surveillance pricing.
The FTC is focusing on four primary areas in its investigation: the types of surveillance pricing products and services offered by the companies, their data collection methods, customer and sales data, and the ways in which these practices affect the prices consumers pay.