“I would support the Commission going after all of it, hard,” Shettleroe said. “My concern is that this Proposed Statement will not accomplish that, and may make things worse for consumers like me.”
Shettleroe criticized the FTC’s required disclosures as legitimizing the practice, noting that the policy statement “describes conduct that outrages people, then offers a remedy that permits it with a notice attached. I do not want a disclosure. I want the practice prohibited where it is clearly exploitative.”
Most people won’t read those disclosures, Shettleroe argued, reducing the FTC’s intervention “to a compliance checkbox, not consumer protection.”
Instead, the FTC should be requiring that businesses provide an opt-out, which might “do more for consumers than every disclosure in this document combined,” Shettleroe said. Another commenter suggested that the FTC should require businesses using surveillance pricing to allow buyers to negotiate prices.
Most frustratingly for avid discount hunters, Shettleroe said the FTC’s “undefined scope” of what’s considered violating personalized pricing could threaten discounts that customers rely on to reduce costs.
“Nowhere does the Commission define ‘personalized pricing,’” Shettleroe said. “The operative phrase is prices that ‘vary based on their personal data.’ That covers my grocery loyalty card, emailed coupons, and app-only prices. Those save me money. If businesses cannot tell which practices are covered, the safe response is to stop personalizing altogether, and the first thing to disappear will be the discounts, not the surcharges. Please state explicitly that loyalty and membership pricing, coupons, promotional codes, and randomized price testing are outside the scope.”
The FTC may look to Congress for help refining its policy statement to resolve some of these concerns. Only Congress can ban personalized pricing, and a bill, the Stop AI Price Gouging and Wage Fixing Act, has been introduced in the House of Representatives. If passed, that law would “prohibit certain uses of algorithmic decision systems to inform individualized prices and wages,” as well as for other purposes.
That bill includes carve-outs for discounts that people have long depended on, including exceptions when a “discounted price is offered to members of a broadly defined group, including teachers, veterans, senior citizens, or students, based on publicly disclosed eligibility criteria,” as well as discounted prices “offered through a loyalty, membership, or rewards program that consumers affirmatively enrolled in.”