FTC moves to make retailers disclose use of ‘personalized pricing’ as technology now enables broad consumer surveillance

The Federal Trade Commission is moving to ensure companies disclose use of customers’ personal data to set prices, as technology makes it easier for retailers to tailor them to individual shoppers.

The FTC said that it is seeking public comment on an enforcement policy statement concerning “personalized pricing,” which the agency defines as using personal data to determine how much a company believes an individual consumer is willing to spend. The proposal would warn companies that failing to disclose that they are using personal data to set prices could violate the FTC Act’s prohibition on unfair or deceptive practices.

“When consumers see a listed price, they expect it to be the same price that everyone else sees, not the retailer’s estimate of how much they are willing to pay based on their personal data,” FTC Chairman Andrew Ferguson said in a press release. “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 F...