Yesterday, Groundwork Collaborative President and CEO Lindsay Owens testified in front of the Senate Judiciary Subcommittee on Crime and Counterterrorism on surveillance pricing and other deceptive tactics that corporations are increasingly using to cheat consumers out of their hard-earned money.
Owens, author of the upcoming book “Gouged: The End of a Fair Price–and What That Means for Your Wallet,” revealed the hidden and pervasive costs of surveillance pricing, even among some popular consumer loyalty programs, and warned that AI is supercharging companies’ abilities to squeeze families’ budgets. She also called for a strong federal standard to better protect consumers from surveillance pricing and more aggressive regulatory enforcement. This year alone, more than 40 bills in 24 states and cities, red and blue alike, have been introduced or passed to curtail surveillance pricing. Groundwork’s polling shows more than 3 in 4 Americans support banning the practice entirely.
Key excerpts from Owens’s remarks are below, and her full opening statement can be found HERE and a recording of the full hearing HERE.
“Surveillance pricing isn’t just unfair. It erodes transparency and predictability and makes it harder for families to budget, let alone comparison shop. As we do more of our shopping online and on our phones, we have no idea if we’re being charged a different price than our neighbor.”
“Companies can now purchase, track, and analyze your personal data at a previously unimaginable scale. They catalog your location, your purchase history, and even your cursor movements to better predict exactly how much they can charge you. Even nominally beneficial programs, like loyalty rewards, can be used to harvest your information, turning customers into guinea pigs in sophisticated pricing experiments.”
“Imagine you’re the parent of a sick child. It’s midnight. You ask Walmart’s AI shopping assistant Sparky to suggest a thermometer and some Tylenol. Sparky knows that your purchase is urgent, potentially leveraging that vulnerability to overcharge you. As agentic commerce reshapes how we shop online, with AI agents gaining access to your habits, purchases, and personal conversations, the risk of being ripped off will only grow.” [VIEW HERE]
“Target’s app hikes the price when it knows you’re in the store. DoorDash has developed technology that tailors recommendations based on how hungry it thinks you are. Travel sites like Expedia have charged users from high-cost cities more for identical hotel rooms. And Kroger’s loyalty program uses your data to predict how much money you make.”
“FIFA used dynamic pricing for the first time ever, and the result was an auction for World Cup tickets which priced out many of the most loyal and passionate fans and turned the sport into a luxury box for the wealthy.”
“Companies hem and haw and deny that they’re using things like surveillance pricing in many settings. But I think if we look at what they do and say in other settings — the technologies they’re building and bothering to patent to get monopoly rates and monetize; if we look at what they tell their investors; if we look at the companies they’re buying up, scooping up pricing tech companies that come to market offering new surveillance pricing technologies — it really paints a different picture of where this country is headed, and where our economy is headed.”
“The answer can’t be to teach everyone how to beat the machine. We must set rules of the road so the machine plays fair. Clear and transparent prices are essential for a functioning capitalist economy… It’s not too late to preserve fair pricing in America. We can start by pricing products again, rather than people.”
BACKGROUND: Owens and Groundwork have been leading the charge to expose deceptive pricing schemes. Last year, in conjunction with Consumer Reports and More Perfect Union, Groundwork revealed that Instacart was charging consumers different prices for identical products. The report spurred major public backlash and a probe by the FTC, causing Instacart to end their AI pricing experiments.