Consumer Reports is supporting A9349B and S8623B in New York, companion bills that would broadly prohibit the practice of surveillance pricing — the use of personal data to set individualized prices for consumers based on willingness and ability to pay.
Companies can gather data on consumers’ purchase, browsing, and search histories, geolocation, IP address, device type, and inferences about family structure, health conditions, or income, to create a detailed portrait of a consumer. Increasingly, some of these companies are seeking to use this data to offer different prices to different shoppers for the same goods and the same exact time.
A recent investigation from Consumer Reports, More Perfect Union, and Groundwork Collaborative revealed that Instacart, enabled by the artificial intelligence pricing software Eversight, was running large-scale, hidden price experiments on unsuspecting customers. The findings show many U.S. shoppers who order grocery pickup and delivery through Instacart were unknowingly enrolled in AI-enabled experiments that can charge up to 23% more for the same item ordered from the same store at the same time. Other high-profile platforms, such as Target and Orbitz, have also been found to offer varying prices to consumers for the same purchases.
A9349B and S8623B would put in place consumer protections to prohibit many of these abusive practices, while allowing companies to preserve transparently offered discounts — including senior citizen and military discounts, loyalty program discounts, and even certain customized discounts. For these reasons, Consumer Reports is urging New York legislators to vote YES on A9349B and S8623B to improve affordability.