The Federal Trade Commission has ordered Walmart and Target to provide details on their use of personal data in pricing strategies. This action is part of a wider investigation into how businesses use consumer information, including through loyalty programs, to potentially adjust prices.
The FTC issued similar orders to nine other companies, spanning airlines, ride-sharing services, and food delivery platforms. The 15-page document requests information on whether prices for goods or services fluctuate based on personal data analysis, such as online browsing behavior or purchase history.
FTC Chairman Andrew Ferguson remarked, “Consumers deserve to know whether companies use their web surfing habits or other personal data to estimate the highest price they can charge each consumer.” He further stressed the importance of transparency in how businesses use personal data to set employee pay.
The targeted companies have 45 days to respond. The FTC can enforce compliance in federal court if needed. Target has directed inquiries to a fact sheet stating they do not use personal information to increase prices based on identity, location, or shopping time.
However, Target notes that prices can vary due to factors like local expenses, pricing rules, and market competition. Their Target Circle loyalty program uses purchase history to provide relevant discounts, not to raise prices.
This investigation follows the FTC’s August request for public input on personalized pricing. The agency also recently sued Dollar General for alleged deceptive pricing practices, joined by 20 U.S. states.
FTC Chairman Highlights Concerns Over Data-Driven Pricing and Worker Compensation
FTC Chairman Andrew Ferguson stated the agency will examine how companies use opaque methods to set prices and worker pay based on personal data. He emphasized consumers should know if their online behavior influences the prices they see.
Ferguson also noted workers deserve transparency on whether their compensation is impacted by how companies use their personal data.
