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.
Eight companies, including Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros, received subpoenas from the FTC on Tuesday, seeking information on how these pricing practices affect privacy, competition, and consumer protection.
These companies are reportedly utilizing data tools, referred to as “surveillance pricing” or “dynamic pricing,” to display varying prices for the same products based on individual consumer traits or behavior. Factors such as location, demographics, credit history, and shopping habits are often considered.
Many of the firms targeted by the FTC provide transaction and pricing services to major businesses in the U.S. and internationally. Task Software, for example, manages transactions for well-known hospitality entities like McDonald’s and Starbucks. Revionics, known for retail price optimization, serves global clients including Home Depot. Pros specializes in AI-driven pricing solutions, with clients such as Nestlé, HP, and United Airlines, and it partners with Microsoft for technology development.
The FTC aims to address concerns about this “opaque market,” where businesses categorize shoppers and establish targeted pricing.
FTC Chair Lina Khan stated, “Companies that gather extensive personal data can jeopardize individuals’ privacy. They could be using this extensive information to impose higher prices on consumers. Americans have a right to understand if businesses are leveraging detailed consumer data for surveillance pricing, and this inquiry will illuminate the obscure world of pricing intermediaries.”
The FTC is specifically interested in four areas: the types of surveillance pricing products and services each company provides, their data collection methods, available customer and sales data, and how these surveillance practices affect the pricing faced by customers.