Rideshare and Retailers May Charge Different Prices Using Your Personal Data
Experiments show Uber, Lyft and major retailers give different prices to users in identical circumstances, suggesting use of personal data for “surveillance pricing.”
A series of controlled experiments compared prices on Uber, Lyft, Kroger and Target when two users ordered the same service or product from the same address at the same moment. The rideshare apps showed disparities as high as 28%, and grocery items varied by up to a dollar, indicating that algorithms may adjust prices based on individual browsing histories and other data. Uber blamed “small discrepancies” such as GPS and marketplace conditions, while Lyft declined comment.
Both Kroger and Target denied using surveillance pricing, attributing variations to local factors. Experts note that Section 5 of the FTC Act does not explicitly prohibit personalized pricing, leaving the practice legal but controversial. New Jersey, Maryland and Connecticut have banned it, and the FTC has proposed rules requiring firms to disclose such pricing tactics.
Why it matters
Consumers may unknowingly pay more for identical goods or rides because companies use their data to set individualized prices.
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