Big data is coming for your purchase history - to charge you more money


Blog 2: Big data is coming for your purchase history - to charge you more money

Amy Le - 黎草嵋
D0731311
Source: https://www.theguardian.com/commentisfree/2015/may/29/big-data-purchase-history-charge-you-more-money

Unprotected consumer data will allow price personalization by companies who know how much you need something and how much you can manage pay

Are you ready for a gas station to charge you more when you are running late or your tank is empty? Laws against price gouging typically apply in times of emergencies, for example after Hurricane Katrina. Most of the time there are no rules that limit price discrimination, and there are certainly no laws against customized products and terms of service. When you add that to the fact that federal privacy laws do a notoriously poor job of protecting our data, it’s clear that consumers are on their own.

Companies can vary their product offerings, price, and contract terms from moment to moment, tailoring offers to each consumer at their specific location and point in time. Websites personalize your experience by remembering who you are and a variety of facts about you. Your browsing history, email, and search terms all affect what you see. Google’s personalized search means that two people searching the same term don’t get the same results or see the same offers. Amazon recommends different products to different customers. And Netflix suggests what to watch based on what it learns about you.

Like products, price is customized all the time. From college tuition to plane tickets to groceries and medicine, consumers have already grown accustomed to paying dramatically different prices for the exact same thing. It’s accepted that the person sitting next to you on a flight or in a lecture hall might have paid half as much as you. Economists call that price discrimination, and it is proliferating throughout our economy.

The goal is to get to a market of one. One-to-one selling pits each individual against a far more knowledgeable and sophisticated seller. Instead of standard prices and products offered to everyone, companies can instantly set prices specifically for you. In the right circumstances, a company that knows how much you need something and how much you can manage to pay can empty your wallet in a millisecond.

Before the internet, market power was equated with a monopoly, the power of a single seller across a large market. Big data changes the game, tilting the balance dramatically in favor of data-rich sellers. Rather than raising prices uniformly across huge markets, a data-rich seller can opportunistically exercise power where traditional monopoly is not visible, charging extra for gas today and a bit more for a movie tomorrow. That granular capability is entirely new and requires new responses.

That’s why antitrust enforcement has become more important than ever as big data supercharges the power of traditional monopolies. Consumers are just as vulnerable to the effects of personalized pricing as they are to price-fixing - yet the government has done little to put safeguards in place. That’s why we must start with protecting the very weapon that companies use against us: our data.

Comments

Post a Comment

Popular posts from this blog

How Big Data Can Boost Weather Forecasting

張岳庭 D0741017 Source:  https://www.wired.com/insights/2013/02/how-big-data-can-boost-weather-forecasting/ Considering the number of variables involved and the complex interactions between these variables, weather forecasting has always been extremely challenging. The significant increase in data collection and processing capabilities has greatly improved the ability of weather forecasters to pinpoint the time and severity of hurricanes, floods, snowstorms and other weather events. Globally, more and more evidence of climate change is prompting governments and scientists to take action to protect people and property from its effects. But to take effective measures, they need to know more about the weather-from everything that will happen tomorrow to what will happen next year. According to the professor of economics and finance , Alan Anderson, PhD , “Example of an application of big data to weather forecasting is IBM’s Deep Thunder. Unlike many weather forecasting systems...
Read more

How Big Data is Changing the Production Industry

Blog#4 : How Big Data is Changing the Production Industry Name : Aileen 蔣慧玲 Student ID : D0726917 Source :   https://www.productionhub.com/blog/post/how-big-data-is-changing-the-production-industry Information technology plays a major role in Hollywood. Producers have to use big data analytics to get the right consumers and communicate with them well. Big data technologies will help filmmakers figure out the best ways to share their ideas and deliver messages, develop movies and content that involve ethical and societal issues. Therefore, information that we can get from the help of big data can help filmmakers make key decisions. Big Data is Changing the Production Game Big data technology can help filmmakers to connect and engage with consumers more directly using social media, mobile devices and traditional advertising outlets. Using this technology, producers can develop promotions that reaches the right consumer at the right time. It is not enough just to mainta...
Read more

Big Data case study: 5 relevant examples from the airline industry

D0740712 Connie  吳霈晴 Website: https://blog.datumize.com/5-relevant-examples-of-a-big-data-case-study-from-the-airline-industry With the summer vacation coming, travel is the one that people love to do during vacation, especially long vacation, going abroad may be the first choice for many travelers. So this makes me think of what is the relationship between big data and airplanes? How will it apply on the airline industry? This article tells about the benefits of big data on airlines, which covers three main advantages. 1.      Smarter maintenance 2.      Safer flights 3.      Improve service The first one includes the fuel of airplane, by analyzing and predicting, the article takes some specific airplane company as an example, giving the real number and how much they save the cost. Second, safety. Like this kind of transportation has a higher risk to take, if have the big data’s help, th...
Read more