The Federal Trade Commission today announced it is seeking public comment on an enforcement policy statement regarding personalized pricing, which is the use of personal data to set prices according to the amount that a company believes an individual consumer is willing to spend.
“When consumers see a listed price, they expect it to be same price that everyone else sees, not the retailer’s estimate of how much they are willing to pay based on their personal data,” said FTC Chairman Andrew Ferguson. “The FTC does not have the legal authority to ban personalized pricing in all circumstances, but businesses that fail to tell consumers how their personal data is being used to set a price may be in violation of the FTC Act and other laws we enforce. We are seeking public input on this draft statement, which would put businesses engaged in or considering personalized pricing on notice that the Trump-Vance FTC will not hesitate to enforce the law in this space.”
This is the latest in a series of actions by the Commission, under President Donald Trump’s leadership, against businesses that mislead consumers with hidden fees and surprise charges.
Consumers expect prices for products and services to change based upon supply and demand, not their web surfing habits or buying history, the statement notes. Retailers who represent or imply that a price is static when it in fact varies by individual are at risk of misleading customers. Informed consumers might take measures to avoid higher personalized prices, such as using a virtual private network or private browsing session, or simply avoiding retailers engaged in personalized pricing altogether.
The statement goes on to note that the undisclosed collection or use of personal data for the purpose of personalized pricing could violate the FTC Act, which prohibits unfair or deceptive practices in the marketplace.
Once the statement has been published in the Federal Register, the public will have 30 days to submit comments electronically. The Commission vote authorizing the Federal Register notice was 2-0.
The Federal Trade Commission works to promote competition and protect and educate consumers. The FTC will never demand money, make threats, tell you to transfer money, or promise you a prize. Learn more about consumer topics at consumer.ftc.gov, or report fraud, scams, and bad business practices at ReportFraud.ftc.gov. Follow the FTC on social media, read consumer alerts and the business blog, and sign up to get the latest FTC news and alerts.
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