Your browsing history is making your Uber rides cost more than your friends’ — even if you’re going to the same place.
It’s a controversial practice called surveillance pricing, or “personalized pricing” as noted by The Federal Trade Commission (FTC). The sneaky scheme has put a spotlight on major companies like Uber, Target and Kroger, all of which have been accused of setting individual prices based on what they think you’re willing to pay.
Here’s how surveillance pricing works: Retailers scrape data from your phone and laptop — things like your purchase history, browsing behavior, whether you comparison shop, your location, your age and more. Like a freaky science fiction film, that intel gets filtered into an invisible dossier and analyzed by an AI bot or algorithm, which tells companies how much you’ll likely spend on a service or item.
After learning about this somehow-legal scam, my co-worker and I decided to do an experiment:
We both ordered an Uber to the exact same location. We were in the same spot and requested a ride at the same time — but I was charged $36.95 and he was charged $33.94, nearly 10% less.
We tried the same experiment with Uber’s main competition, the rideshare app Lyft. Again, we used the exact same pickup point. This time, my ride was $24.98 and his was $31.95 — almost 28% more expensive.
“Weird,” said my co-worker. It was, which is why we kept testing our product pricing.
The Post compared a slew of items from Target, Walmart, Kroger, Uber, Lyft and DoorDash — all mega-companies that have been accused of surveillance pricing online.
But the biggest offender, The Post found, was on ridesharing apps Uber and Lyft.
In another experiment, a friend — 33, in Brooklyn — typed in the same pickup location as I did, with the drop-off location at our Midtown office. The popular rideshare app charged me $52.93 and her $47.20 — almost $6 more.
We then tried JFK Airport and once again the difference was huge — mine was $61.77 and hers was $82.66.
Now Lyft — my ride to the Midtown office was $49.35 and hers was $51.94. At JFK Airport, hers was $77.96, while mine was cheaper at $74.07. Again, we were going to and from the exact same place at the exact same time.
An Uber spokesperson told The Post that those price fluctuations were caused by “small discrepancies” like GPS location, timing or marketplace conditions — the type that result in surge pricing when demand is higher for cars.
“In a real-time marketplace, a trip is defined not only by where it starts and ends, but also by when it is requested and what marketplace conditions exist at that exact moment. Nearby rider demand, driver availability, traffic, routing, and estimated trip length can all change within seconds,” the spokesperson told The Post.
But again, we were leaving from and going to the exact same place at the exact same time.
Meanwhile, Lyft has not responded to The Post’s questions at all.
Would supermarkets fare any better? We tried it with Kroger.
I called a friend in New Jersey, 30, and we both searched for everyday essentials in our kitchens, starting with beef — an item already impacted by inflation.
On my friend’s browser, Kroger’s website showed beef at $6.99 per pound.
Kroger’s beef on my browser? $7.99 — a full dollar more for the exact same product.
We tried milk next. She saw a gallon of the Kroger brand at $3.79. Once again, I was charged more — mine came in at $3.99. Same for the Kroger-branded ice cream: Hers was $2.50; mine was $2.99.
Curiously, the tables turned when we searched for sliced turkey. Mine was $10.99 while hers came out to $12.99 — two dollars more.
Kroger prices, even for the same product, may vary based on location. Even two Kroger stores in the same state can have different prices as promotions, digital coupons and fulfillment locations may differ, the grocery giant said online.
Kroger told The Post, “Kroger has never and does not use surveillance pricing.”
Next up was Target, the company that settled a $5 million lawsuit with San Diego County back in 2022, after prosecutors found it was raising prices in its app when shoppers entered a store’s parking lot.
I called my sister — who lives in California and is 27 — and we chose two kitchen staples, Spam and applesauce. (Well… staples for some people.)
Target advertised a 12-pack of Mott’s pouches to my sister for $8.99.
My price was almost a dollar more — the retail behemoth wanted to charge me $9.79.
The Hawaiian staple, Spam, would cost my sister $4.19. But once again, Target showed me a higher price tag: $4.49.
Was this surveillance pricing? Target told The Post it could actually be our saved browser locations — I was searching from Los Angeles; she was in Newport Beach — that could have caused the price disparity.
Still, we were confused. Why would the difference in pricing show up in the product’s cost, instead of in state taxes and shipping?
Target told The Post it does not use surveillance pricing, and costs are based on a variety of factors.
“We don’t use guest data to raise prices for individual guests based on who they are, where they live or how they shop. Pricing may vary depending on whether a guest is shopping in a store, on Target.com or in the Target app,” a Target spokesperson said.
“Those differences reflect local factors such as operating costs, local pricing ordinances, competition, and discounts that may be unique to a store or digital channel – not individual guest data,” they added.
Regulatory reckoning
Experts told The Post that personalized pricing is shockingly legal.
Dr. Thomas Weinandy is the principal research economist at Upside, the nation’s largest food and fuel app.
He told The Post personalized pricing is hard to stop, since many consumers don’t fully understand the scope of how their data is being used. Plus, there are many deals and perks shoppers appreciate as a result of data collection.
“Most consumers like loyalty rewards, student and senior discounts and targeted promotions,” Dr. Weinandy told The Post.
The issue is that the existing law around surveillance pricing, Section 5 of the FTC Act, prohibits unfair or deceptive acts or practices. But the language is vague, and makes no mention of personalized pricing.
This means, the FTC — the agency protecting consumers — can’t actually ban retailers from using personalized pricing.
In a recent proposal, researchers warned corporations that secretly using personal data to set individualized prices could be deceptive or unfair, directly violating the law.
The group plans to “enforce the law aggressively” and proposed requiring businesses to disclose if they engage in the deceptive pricing practice.
“When consumers see a listed price, they expect it to be the same price that everyone else sees, not the retailer’s estimate of how much they are willing to pay based on their personal data,” FTC Chairman Andrew Ferguson said in the FTC proposal.
Three states have also taken to the courts, enacting laws banning or substantially prohibiting surveillance pricing: New Jersey, Maryland and Connecticut. New York is also moving to crack down on the controversial practice after the Legislature passed the One Fair Price Act in June.
But despite the bill’s bipartisan support, the state Senate’s legislative page currently shows it as not yet signed into law.
Meanwhile, experts warn that these murky pricing tactics can leave shoppers unaware of how their personal data could be used to determine what they pay.
“Personalized pricing is retail’s quicksand — the thing people fear stepping into but is difficult to find in the real world,” Dr. Weinandy said.
Meanwhile, we’ll be checking our Uber app with much more caution — and, perhaps, a new incentive to try an old-school yellow taxi in Midtown.
