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Online 'personalised pricing' probed by regulator

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Websites that monitor online shoppers and then use the data to present them with personalised prices and offers could be investigated by the Office of Fair Trading.

Some businesses track their consumers online, gathering and recording information about their habits, the websites they have visited and the items or services they have looked at.



Anyone who has ever visited Amazon will know about being presented with a range of recommended items based on the products and services that they have previously viewed.

In a scoping exercise, the OFT intends to look at how businesses use such consumer information and whether they change the prices they offer to individual shoppers as a result. The probe is not aimed at Amazon or any other specific retailer.

The "call for information" review will consider the business and technological developments in the online shopping market, along with consumers' understanding and awareness of how their information is being used.

It will also consider whether consumers are being treated unfairly in law as a result of the gathering of their data.

The OFT will work with other international bodies in the investigation, including the US Federal Trade Commission (FTC), which has done extensive research in the area.

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After completing the probe, it will see whether there are grounds for a more formal review.

Clive Maxwell, the chief executive of the OFT, said that online innovation is "an important driver of economic growth", but the body wants to know how people's data is being used for marketing purposes.

"Our call for information forms part of our ongoing commitment to build trust in online shopping so that consumers can be confident that businesses are treating them fairly," he said.

"We know that businesses use information about individual consumers for marketing purposes. This has some important potential benefits to consumers and firms. But the ways in which data is collected and used is evolving rapidly."

He added: "It is important we understand what control shoppers have over their profile and whether firms are using shoppers' profiles to charge different prices for goods or services.

"This call for information will help us understand these practices better and to decide whether or not this is an issue on which the OFT needs to take any action."

The scoping exercise follows the OFT's Online Targeting of Advertising and Prices (OTAP) report published in May 2010, which stated that the body would keep a watching brief on this area as technology developed.

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