At some point in the near future, you may be paying more for any random product than one of your friends. At the same time, however, you could also be paying less for a different product. This is the surprising reality of a new pricing strategy being employed by countless companies today. It is called personalized pricing.

This form of price discrimination sparks from the need to withstand the competition of the low-pricing Amazon. Instead of attempting to match the low prices of Amazon, companies are attempting to use customer information to charge them the prices in which they’re willing to pay. Punit Kulkarni, director of marketing at Symphony Analytics, describes it as “moving away from low prices to relevant prices”.

The questionable aspect of personalized pricing is the manipulation of customer information. For instance, when you’re shopping in the store for salsa, you might receive a coupon for tortilla chips right at that instant. The use of in-store cameras and other strategies to evaluate individuals’ needs is considered by some to be unethical. To many individuals, this is an invasion of their privacy.

The need to compete with other companies is inevitable and price discrimination seems logical. However, customers may find themselves drawn away from certain companies because of the privacy concerns.

In today’s world, an ethical company is an attractive company. Certain businesses that decide to use personalized pricing will likely face backlash from consumers. With this in mind, the attractiveness of individual pricing should be overlooked due to the ethical concerns associated with it.