3 On Your Side: Consumer Advocates Warn Of Price Discrimination
by Jim Donovan
PHILADELPHIA (CBS) -- Like it or not, when shopping online companies learn a lot about you, according to software developer Christian Bennefeld.
He says companies can track virtually everything you do online, including what websites you've visited, what items you've purchased, your location or what device you are using.
And based on that, you may get different search results and even prices.
To demonstrate, Bennefeld looked up hotel prices on Travelocity using his invention called an e-blocker, which makes it seem as if he's searching from different devices.
First he looked at prices on an iPad, then he searched acting as a laptop.
He got two different prices.
Travelocity says "the difference in price is likely attributable to a deal this hotel was offering to customers on mobile devices exclusively, an increasingly common practice in the travel industry."
It's one example of what consumer advocates call price discrimination, different prices for different people.
And those varying prices aren't limited to hotels - or any one site.
A 2014 Northeastern University study found evidence of personalized prices on 9 out of 16 e-commerce sites, "including cases where sites altered prices by hundreds of dollars."
On some sites it said users were steered toward more expensive hotels
But trade experts say that tracking allows companies to customize offers that customers do want.
"I don't want to receive ads from Zappos for women's shoes, I want to receive ads from Zappos for men's shoes and the athletic shoes," said Randall Rothenberg, president and CEO at Interactive Advertising Bureau.
Some find the practice a little creepy.
"Sure! Sure it's a little creepy. But you know, so is all the stuff the credit card companies and the retailers have been collecting about you for decades and decades," Rothenberg said.
Price discrimination is perfectly legal. So it's up to you to protect yourself.
Some ways to stop companies from tracking you? Use that e-blocker device. Use separate browsers or clear your browser history on a regular basis.