The Federal Trade Commission has proposed a new policy that would require companies to be transparent about personalized pricing, a practice where prices vary based on an individual customer's data. Companies found to be secretly altering prices based on their estimation of what a customer is willing to pay could face federal charges under the proposed rules.
"When consumers see a listed price, they expect it to be 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 a statement.
The FTC has been investigating personalized pricing, noting in a preliminary report in January 2025 that retailers, including grocers and clothing companies, were utilizing third-party services to customize online prices. These customizations were based on factors such as shopper location, browsing history, and the duration items remained in virtual shopping carts.
As an illustration, the FTC presented a hypothetical scenario where a consumer profiled as a new parent might encounter higher prices for baby thermometers when they appeared in search results.
Ferguson stated that while the FTC does not possess the authority to ban personalized pricing outright in all situations, the proposed policy mandates that businesses must "clearly and conspicuously disclose” if they are employing personalized pricing. They would also need to share the types of data used to set these prices.
According to Ferguson, companies that engage in personalized pricing without disclosing the practice and the underlying data could be in violation of the FTC Act, which prohibits unfair or deceptive business practices.
The commission is soliciting public comment on the proposed policy for a period of 30 days.