In its most brazen form, it works like this: Retailers read the cookies kept on your browser or glean information from your past purchase history when you are logged into a site. That gives them a sense of what you search for and buy, how much you paid for it, and whether you might be willing and able to spend more. They alter their prices or offers accordingly...More at the link.
Sellers of time-sensitive, highly price-variable goods (think airline tickets, hotel rooms, or car rentals) do it all the time, somewhat openly. If you have ever had the annoying experience of buying a plane ticket through a portal like Kayak, then seeing the final price jump $10 or $40 at check out, you have probably found yourself on the receiving end of dynamic pricing...
This August, the Wall Street Journal reported on a company that helps Capital One determine what credit-card deals to offer customers when they land at the site. The deals change depending not on any credit-rating or salary information given to the firm by the customer—just on information skimmed off of their computer before the page loads. More recently, bloggers caught the bank offering different deals to users using different browsers...
Researchers conducted a 1,500-person survey and found about two in three respondents did not know it is legal "for an online store to charge different people different prices at the same time of day." About 70 percent did not realize it is also legal for bricks-and-mortar stores to do so. But yes, as long as stores do not discriminate based on age, sex, location, or a few other characteristics, stores can price as capriciously as they want.
27 January 2011
Some tips about online shopping
Most people who shop online are aware of these things, but a Slate article provides a nice summary: