Surveillance Pricing

When you shop online or through an app, do you ever wonder if you’re being charged the same as someone else for the same thing? Even controlling for things like shipping address and local taxes, it turns out that today it’s not uncommon for pricing to dynamically change based on factors that may not seem fair. This is called surveillance pricing. Justin Brookman (Consumer Reports) and Eric Gardner (More Perfect Union) recently performed a study on this practice using Instacart, and the results were eye-opening.

Interview Notes

• Surveillance pricing study: https://www.consumerreports.org/money/questionable-business-practices/instacart-ai-pricing-experiment-inflating-grocery-bills-a1142182490/
• Study video (Instagram): https://www.instagram.com/reels/DSC1w_Hjng6/
• Study video (YouTube): https://www.youtube.com/watch?v=osxr7xSxsGo
• Consumer Reports: https://www.consumerreports.org/
• More Perfect Union: https://perfectunion.us/
• Get involved: https://action.consumerreports.org/
• Instacart’s AI-Enabled Pricing Experiments May Be Inflating Your Grocery Bill: https://www.consumerreports.org/money/questionable-business-practices/instacart-ai-pricing-experiment-inflating-grocery-bills-a1142182490/
• Pepsi/Walmart exposé: https://ilsr.org/article/independent-business/more-perfect-union-pepsi-walmart/
• Amazon price tracker: https://camelcamelcamel.com/

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Table of Contents

• 0:00:13: Intro
• 0:02:44: What’s your background?
• 0:04:26: What triggered this study?
• 0:06:08: How did you test this theory?
• 0:09:25: How prevalent is this practice?
• 0:11:27: What is a “customer surplus”?
• 0:13:44: Did the pandemic exacerbate this?
• 0:15:08: Is this practice legal?
• 0:21:42: How do ESL’s work?
• 0:25:52: Are all the add-on fees legit?
• 0:28:01: Are the stores participating in this, too?
• 0:32:01: What do they learn from loyalty programs?
• 0:37:38: Are digital coupons dynamic, too?
• 0:41:07: Does this amount to price fixing?
• 0:44:21: What’s been the reaction to your report?
• 0:49:00: What will you study next?
• 0:53:04: What can we do about this?
• 0:58:39: How can we support your work?
• 1:00:39: Wrap-up
• 1:03:27: Patron podcast preview