The Price Tag Is Watching You

A business that knows your habits, your circumstances and how urgently you need something has a powerful advantage. It can study how much you will tolerate paying, then shape its offer accordingly. For a household watching every dollar, the information surrendered while shopping could become another expense.

At a parliamentary hearing on 16 October⁠, the Australian Competition and Consumer Commission warned that increasingly detailed personal information could reveal a consumer’s willingness to pay and identify vulnerability. Its digital markets general manager, David Abkiewicz, also explained that charging different groups different prices was not itself against Australian consumer law.

Think about the commercial incentive. A seller could use your circumstances to decide whether to offer a discount, withhold one or steer you towards something more expensive. Financial pressure, urgency or limited alternatives become information to exploit. The customer trying to stretch a pay packet becomes a calculation about how much more can be extracted.

Ordinary dynamic pricing responds to changing conditions such as demand and availability. Surveillance pricing brings the customer’s personal information into that calculation. Two people looking for the same product can encounter different offers because the system has formed different judgments about them.

The machinery already exists. In its January 2025 findings on surveillance pricing⁠, America’s Federal Trade Commission described intermediaries capable of tailoring prices and promotions using location, browsing behaviour and shopping history. Even mouse movements and products abandoned in an online basket could feed the process. The investigation examined commercial records obtained from pricing intermediaries.

Now add the AI shopping assistant: the friendly service promising to search, compare and find the right purchase for you. Handing over that task also hands over influence over what you see. A recommendation can cost you money without any change to the product’s advertised price, simply by directing you towards a dearer option.

The ACCC’s own submission to Parliament’s AI inquiry⁠ identifies risks including agents steering customers against their interests, favouring affiliated businesses and coordinating in ways that undermine competition. Britain’s Competition and Markets Authority⁠ has likewise warned that consumers could be directed towards products that are more profitable but less suited to their needs. These are identified risks requiring scrutiny, not findings that every shopping assistant behaves this way.

Before trusting an assistant with the household budget, consumers deserve to know who pays it, which sellers it searches and whether commercial relationships influence its recommendations.

Canberra understands the problem. In a 17 June speech⁠, Assistant Minister Andrew Leigh discussed hidden commercial steering and illustrated how an urgently needed replacement fridge could expose a buyer to personalised pricing. He also proposed controlled shopping tests and records that would allow regulators to examine pricing decisions.

Those tests should produce evidence Australians can inspect. Compare identical products at the same time, holding delivery conditions and membership benefits constant while varying customer profiles. Examine which information changes the offer, which sellers receive prominence and whether the consumer is told why. A price difference needs investigation before anyone declares a particular retailer guilty.

Defending free enterprise means defending the customer’s freedom to compare, refuse and walk away. Businesses should compete through price, quality and service. Hidden payments, deceptive recommendations and the exploitation of private information deserve direct scrutiny, with responsibility resting on the companies deploying the systems.

Australians should be able to shop without wondering whether every click is teaching a corporation how much harder to squeeze them. The price tag should tell you what the goods cost. Your private life should not become the seller’s negotiating advantage.

“Surveillance is the business model of the internet.”
– Bruce Schneier