As technology advances, companies are finding new ways to price their products based on a customer's location, browsing data, and purchase history. According to Lindsay Owens, head of the consumer advocacy group Groundwork Collaborative, these tactics are not new but have been supercharged by new technologies. Owens, author of the book "Gouged: The End of a Fair Price — And What That Means for Your Wallet," shares advice on how to protect yourself from these pricing schemes.
One way retailers collect data is through their apps and websites. When shopping through these platforms, customers are giving companies a lot of information about themselves, including location and purchase history. This data can be used to determine how much a customer is willing to pay for a product. Owens advises against shopping through retailer apps, as the incentives offered are not worth the potential risk of being charged more.
To avoid personalized pricing, Owens suggests comparison shopping across multiple devices, while logged in and logged out, with and without incognito mode, and with and without a virtual private network (VPN). This can help ensure that customers are not being exposed to personalized pricing. Additionally, customers can ask friends to check prices on their devices to get a better idea of the fair market price.
Clearing browsing data and cookies regularly can also make it harder for companies to track customer data. By limiting the permissions granted to apps and using a VPN to hide location, customers can reduce the risk of being charged more for a product. Owens also suggests running pricing experiments using a VPN to change location and see if a more competitive price can be obtained.
Shopping in person at local, mom-and-pop shops can also help customers avoid personalized pricing. These small businesses may be more expensive and less convenient, but they are less likely to run sophisticated pricing experiments on customers. However, Owens notes that even brick-and-mortar stores are starting to use electronic shelf labels, which can change a product's price at any time.
Some states are taking steps to ban personalized pricing. A new law in Maryland will go into effect on October 1, banning the use of personalized or dynamic pricing at grocery stores and third-party delivery services. Other states are considering similar bans. Customers can also take steps to protect themselves by being aware of these pricing tactics and taking steps to avoid them.
By being informed and taking steps to protect themselves, customers can avoid being ripped off by retailers. Owens' tips include avoiding shopping through retailer apps, comparison shopping, clearing browsing data, and shopping in person. By taking these steps, customers can help ensure that they are getting a fair price for the products and services they need.
Key points
- Retailers are using data to charge customers more for products and services based on their location, browsing data, and purchase history.
- Customers can take steps to avoid personalized pricing, such as avoiding shopping through retailer apps and clearing browsing data.
- Some states are taking steps to ban personalized pricing, including a new law in Maryland.
