Trimming One’s Sales – An Irishman’s Diary about customised pricing in the internet age
I was briefly outraged the other day to read of an unnamed British retailer now “testing electronic price tags that display an item’s price based on who is looking at it”. The retailer would be able to do this, naturally, because of the customer’s smartphone, that treacherous pocket spy currently revealing not just our geolocations but also our consumer profiles to anyone who’s interested. It’s probably working for the Russians too.
But as the article in question (in the New York Review of Books) pointed out, internet commerce sites have been doing much the same thing for years. As far back as the turn of the millennium, Amazon was already experimenting with “dynamic pricing”, whereby different people paid different amounts for the same thing, until a customer backlash forced a retreat.
Since then, some American online retailers have been found to set prices according to your “zip-code”. And in a 2012 survey, the Wall Street Journal noted that travel booking site Orbitz automatically referred customers with Apple computers to more expensive hotels.
If you can afford a Mac, obviously, you have money.
Moveable prices are just the leading edge of a vast information-mining industry that now surrounds us, from the supermarket loyalty card to the “98 data points” collected (according to the Washington Post) from Facebook users, revealing gender, ethnicity, income, “soccer mom” status, and so on.
Everywhere you turn on the internet, there are automated programmes trying to work out, based on your interests, what you might want to buy.
Results range from the sinister to the unintentionally comic. Britain’s Private Eye magazine collects the worst mismatches in its “Malgorithms” column. This recently included a Daily Telegraph report about Queen Elizabeth’s “heavy cold”, which auto-generated an accompanying ad on “the importance of having a funeral plan”. Elsewhere, in the (London) Times, a story headlined “I’ll never forgive ‘killer’ bride, says victim’s mother” was matched with a jewellery shop’s invitation to “Celebrate Valentine’s for the moments that matter”.
Of course, you can still avoid this sort of thing by buying the print edition of newspapers (please do). And as for the more egregious online snooping, there are ways around that too. Clearing computer cookies is one. Using different laptops and locations to check prices (net of Mac tax) is another. Lying to your smart-phone is good too.
But that all seems like hard work. And although the ubiquitous surveillance can be considered invasive, it also (for now anyway) seems a bit desperate. After all, in their ham-fisted way, the algorithms are only trying to do in a globalised world what sellers used to do when everybody bought stuff in person.
Even today, if you go on holidays to any of the less developed countries, you will quickly discover that dynamic pricing is still the norm. There will be at least two rates for everything, the higher one for tourists. In markets, you can expect to be data-mined for all relevant information, including colonial guilt levels and the whereabouts of your embarrassment threshold, before the price of anything is decided.
Not that you have to go abroad to find customised pricing. In western supermarkets, even where prices are fixed, the bewildering levels of choice may serve a similar purpose. There is usually at least one “luxury” version of your product, and if the difference in quality is not always discernible, it may be that the price includes the voluntary snob tax some customers like to pay.
Outside shops, meanwhile, there remain certain things the pricing of which requires buyer and seller to meet face-to-face and engage in an intimate exercise of mutual assessment.
I’m fairly sure you still can’t buy a horse on Amazon. Facebook, maybe, but even there you’ll probably have to arrange a meeting with the seller. And the typical Irish horse-dealer could probably harvest 98 data points about you just from a glance at your car. It may be a while yet before online intelligence gathering matches the heights of sophistication of our grandparents’ or great-grandparents’ generations, for whom the more important transactions were done at fairs.
They didn’t have zip-codes to go on then – zippers hadn’t been invented. But every other item of apparel could be studied for clues as to the buyers’ income and personality. The cut of your collar would be a giveaway. Likewise the state of your shoes. Chances are even the angle of your hat would yield important information about your county origins, educational attainments, salary, marital status, religion, and attitude to Home Rule.