Aggregator websites would be among the most likely travel industry suspects to use technology that charges different prices according to the wealth of customers, an IT expert has suggested.
The Office of Fair Trading (OFT) has recently launched an investigation into claims that online shoppers are being charged different prices thanks to companies using software to ascertain how well-off the user is, such as whether they are using an iPad or live in an expensive area.
Anecdotal evidence appears to suggest that some websites detect when a shopper is intending to make a purchase, such as if someone looking at hotels has already browsed flight options.
To do this, the software analyses the cookies – tiny files that are stored on your computer by websites in order to keep track of your activity on the site – to show what sites the user has been looking at. The software can also detect other information such as the type of computer being used and its location.
IT expert Tom Cheesewright told Travolution that he doesn’t expect personalised pricing “to be widespread”, both within the travel industry and elsewhere on the web.
When asked whether he thought the OFT’s investigation would find that travel websites were among the main culprits of personalised pricing software, Cheesewright said that there was no technological reason why that should be the case, but admitted that much of the anecdotal evidence related to travel sites.
“There’s clearly a folklore building up around this, and people think prices are being manipulated,” said Cheesewright.
“If you did find it happening in the travel industry, it might be in the more sophisticated companies, perhaps the aggressive online firms and aggregators.”
Cheesewright said that Amazon is the only company known to have introduced personalised pricing in 2000, a simple version involving charging registered users more than unregistered ones, but the company dropped it following complaints. No one in the UK has been prosecuted for personalised pricing, he said.
According to Cheesewright, there are two main reasons why he doesn’t think personalised pricing is widespread.
“One reason is integrity,” he said. “I think a lot of people would find this potentially distasteful, even some of the hard-nosed business people. If they didn’t find it distasteful for moral reasons, they would think the consumer backlash would be large.”
The other reason boiled down to technological know-how in order to produce and use such software.
“There are few companies that have the technical competence that can do it in a subtle way,” said Cheesewright.
The OFT is currently gathering evidence, in partnership with the US Federal Trade Commission, to find out how widespread the practice is, and is due to publish its results in the spring.