UK investigates online pricing, behavioral advertising

The two studies will look at behavioral pricing practices and if certain online pricing strategies mislead consumers

The U.K.'s competition authority launched two studies on Thursday that will probe behavioral-advertising pricing strategies and if some pricing practices could potentially mislead consumers.

The aim of the studies is to give the Office of Fair Trading (OFT) a view of how pricing strategies and techniques are changing in e-commerce, the agency said.

The first study, due to be completed next spring, will look at behavioral advertising and customized pricing, where the prices fluctuate depending on information about a person's Internet use.

Behavioral advertising has proved controversial. It can involve observing what Web sites a person visits, keywords they use in search engines, as well as how long they stay on certain Web sites or approximately where the consumer is located. Privacy advocates have roundly criticized the systems, even if the data is anonymized.

The other study will investigate deceptive pricing practices. It includes practices such as "baiting," where some products are discounted but there are too few quantities. Consumers may then end up buying a more expensive product or are pushed into upgrading a product at a higher cost. The OFT said "potential representatives" of the practice include travel Web sites and airlines, consumer electronics retailers and clothes Web sites.

It will also look at "drip" pricing, where a consumer only sees an element of the price initially but then is forced to buy more options, a sort of drip effect. OFT said potential representatives of this practice include insurers, airlines and car-rental businesses. The study should be done by next summer.

The OFT could take several actions following the studies, including taking enforcement action against companies violating consumer law or making recommendations to regulators.

In August, the OFT said it needed to keep up-to-date on Internet advertising practices and if there's a potential that certain types of advertising are bad for consumers. At the time, it launched a consultation on what areas of online advertising it should study, leading to Thursday's announcement.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags online advertising

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Jeremy Kirk

IDG News Service
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?