The Federal Trade Commission (FTC) has initiated an investigation into several major companies regarding their use of customer data, algorithms, and artificial intelligence to personalize pricing for consumers.
The firms under scrutiny include Mastercard, JPMorgan Chase, Accenture, Task Software, McKinsey & Co., Revionics, Bloomreach, and Pros. The regulatory agency has issued information requests to these companies to understand how these pricing strategies affect privacy, competition, and consumer protection.
Companies utilize data-driven tools, often referred to as “surveillance pricing” or “dynamic pricing,” to present varying prices for the same products based on individual consumer traits, which may include location, demographics, credit history, and browsing habits.
Several of the targeted companies are significant players in transaction, sales, and pricing services for major U.S. and international brands. Task Software handles transaction management for leading hospitality businesses such as McDonald’s and Starbucks. Revionics specializes in retail price optimization software and serves global retail chains like Home Depot. Additionally, Pros offers AI-driven pricing solutions and counts Nestlé, HP, and United Airlines among its clients, with ties to Microsoft as a development partner.
The FTC aims to explore this “opaque market” where shopper categorization may lead to targeted pricing strategies. FTC Chair Lina Khan emphasized the potential privacy risks associated with companies collecting personal data, suggesting that this information could lead to inflated prices for consumers. She stated that consumers should be informed about how their data is used in surveillance pricing, and the FTC’s investigation seeks to clarify the operations of these pricing intermediaries.
The FTC is particularly interested in four main areas: the range of surveillance pricing services offered by the companies, their data collection methods, sales information, and the effects of these practices on consumer pricing.