A new study confirms that the price you see for something online may depend on the information the retailer has found out about you.
Photo Credit: Associated Press

Retailers vary online prices based on client data

Retailers are using information they get from the internet about shoppers to decide what price to set on items they are browsing online. Researchers at Northeastern University in Boston have confirmed that major online retailers charge varying prices that depend on shoppers’ profiles. They can vary as much as 10 or 15 per cent.

Canadians are increasingly shopping on line, often hoping to find the lowest prices. Canada Post says 76 per cent of Canadians shopped online last year, and one quarter of them made between four and 10 purchase on the internet.

‘Not illegal…not new’

Changing prices is not illegal or immoral, says Carmi Levy, a technology analyst and writer with Voices.com, nor is it new. “We need to recognize that this has been going on for a very long time… We’re hearing about it now because it’s online.

“For example if you’ve walked into a car dealership five, ten, 20 years ago, they look at you. They see what you’re wearing. They look out the window and check out the car you used to drive in. And they’re making judgement calls about what kind of customer you and they’re already adjusting their negotiation tactics and their pricing models to align with that.”


Retailers know where you are, how you browse

He notes that grocery stores too have different price structures according to the neighbourhoods they are in. “Really all we’re seeing now is just a layer of technology on top of something that’s always been in place in retail. We just haven’t been paying attention to it,” says Levy.

Now, retailers can find out a lot about a customer. GPS on their devices indicate where they are and that suggests to retailers how affluent they are and what kind of price they may be willing to pay. If they are on a mobile device they may be more apt to make a purchase on impulse. Plus there is a lot of information that can be gleaned about customer preferences.

How to find lowest prices

Levy has advice for those wishing to find the lowest prices.

First, he says that if web retailers ask you to log in or sign in, it is a good idea to do so. Often that makes you a privileged customer eligible for lower prices.

Hiding your personal data

If you want to limit the data that retailers can access you can go into your browser setting and turn on private of incognito browsing. You can delete or adjust cookie settings to limit retailers’ ability to track you and collect information about your preferences. And Levy says if you want to buy an item, put it in your shopping cart, but don’t check out. A retailer may then chase you down and offer a lower price to seal the purchase.

Levy says a customer can also search for prices on different devices in different locations to see if one is lower.

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