In recent times, various applications have started to view content or advertisements in a very personalised manner. This is evident from the search results that Google produce as well as the product recommendations of Amazon. This feature enables users’ to view results based on their past activities and purchases while online shopping.
According to a research conducted in the Northeastern University by Prof. Wilson, Greg St. Martin reported that online shoppers are facing hike in prices as the e-commerce websites and their search results are being controlled. The prices are being tailored and customised without the customer’s knowledge leading them to pay more than others.
A research was conducted by his team where they studied 16 well-known e-commerce websites among which 10 were online shopping websites and 6 hotel and car rental websites. The research was conducted to observe two main forms of personalisation: price discrimination and price steering. In the former, the price of the product is tailored for the user and in the latter the order of the search result is customised.
The results did not reveal any signs of price discrimination and steering but they did identify price differences in six such companies. This study was presented in the 2014 Internet Measurement Conference in Vancouver where they chose to speak about popular e-commerce sites. However, Amazon and eBay were ruled out from the list as they operate as an online marketplace. Websites like that of Apple was also excluded as they just sell their own products.
Wilson and his team however failed to stress if these practices of personalisation are transparent. They came to the conclusion that it is comparatively difficult to identify such price discriminations in e-commerce websites. Therefore, to find more evidence, they conducted another research to accurately indicate the price discriminations.
They deduced that it occurred due to the number of search results that pop up on your desktop every time you search a product. Change in inventory and geographical miscellany also play a predominant role in price discrimination.
Wilson suggests that there is no viable way to get a good price off the internet. He also remarked that the price and algorithms of the website change routinely and consumers are at a disadvantage unless the website provides transparency.