Four Ways “Surveillance Pricing” Can Quietly Empty Your Wallet
Life is already too expensive. We have to deal with inflation, shrinkflation, and the threat of stagflation. Still, some companies go further. They watch you. Whether you’re sitting in a coffee shop on your laptop or lying in your bed on your phone, they watch every search, scroll, and GPS ping. Now, they are using that information to decide how much you will pay for the things you need. The practice is called surveillance pricing. It may sound technical, but the result is simple: higher bills for those with the least room to absorb them.
It Started With A Promise.
Businesses, academics, and benevolent tech bros promised us that data-driven approaches would lower costs. Traditional economics argued that “price discrimination” lets stores serve budget buyers with discounts while capturing more from enthusiasts willing to splurge. On a whiteboard, that looks efficient. In practice, firms with vast data sets discover who is stressed, rushed, or has limited alternatives—and lift prices accordingly.
A 2025 study by my superb former colleagues at the FTC found that companies are blending browser fingerprints, income proxies, and even sleep patterns to set prices and take advantage of people who can’t afford to spend hours price matching before buying any single item.
FTC Case Files: Four Ways Algorithms Quietly Raise Prices
1. Crib-Buying Parents Pay More
A retailer that tags you as a new parent can reorder search results so the priciest baby thermometers land on page one. Choose “fast delivery” on infant formula and the software infers you’re rushed, so it charges you more because it knows you’re sleep-deprived, overwhelmed, and desperate.
2. Pop-Ups for Hesitant Gamblers
Hover on a sportsbook homepage or drift toward the close-tab button, and a last-second pop-up splashes “can’t-miss” odds to keep you betting. The algorithm is watching you through your laptop or phone screen, it sees you hesitating, and it does whatever it takes to get you hooked.
3. Disaster-Zone Stress-Relief Ads
After a supplements company cross-checks your shipping addresses with weather alerts, it starts sending you and your neighbors promos for “calming” elixers while you wait out the storm at your local shelter.
4. First-Time Car-Buyer Upsells
Your kid gets flagged as a first-time buyer while using an in-store kiosk to explore different cars. The dealership’s system then assumes he is less savvy so it pushes marked-up financing rates, aggressive trade-in offers, and glossy maintenance add-ons.
These snapshots illustrate how companies can use surveillance pricing to squeeze you and your family into paying more for everyday essentials, such as diapers, to major purchases like a $40,000 truck. Surveillance pricing doesn’t just shuffle numbers; it studies mood, urgency, and inexperience before it monetizes the data point by point.
Why Competition No Longer Saves Us
Textbook advice says, “Walk away if the price feels wrong.” But the modern economy often only gives us the illusion of choice rather than actual choice. We see things like:
- Platform lock-ins. Amazon once barred sellers from listing products at a lower price elsewhere, nudging prices up across the web until regulators intervened.
- Industry consolidation. A handful of grocery chains, airlines, and telecoms dominate national markets, dulling traditional price wars.
- Blackbox algorithms. Even experts struggle to spot when a higher price is strategic or merely random.
The Human Cost: Data Shows Who Pays More
Findings in the European Journal of Operational Research show that surveillance pricing, when deployed to exploit individuals living paycheck to paycheck, results in goods that are both more expensive and of lower quality. But it’s not just people with low incomes, it’s also people who don’t have the time, tools, or ability to shop around for the best price in a world with thousands of “options,” most of which are produced by a handful of companies, mix-and-matching the labels. People describe feeling trapped: the site knows they need baby formula at midnight and pushes the checkout total up by dollars, not cents.
Why Is This Happening?
Was it inevitable for surveillance pricing to fail to live up to its lofty promise of improving our markets? Maybe. It reminds me of an idea I heard from Tim Wu, an antitrust expert and professor at Columbia Law School. Professor Wu discussed how AI has the potential to radically improve our work lives, but ultimately, it may end up as another arms race, where instead of giving us our time back, people will use AI to create more work that makes us all miserable. The same pattern haunts shopping. Algorithms could streamline supply chains; instead, they sharpen extraction tactics. In the end, we are not freed but squeezed.
I’ve seen technology transform lives. People have access to vast amounts of information and should have greater control over their lives and the products they purchase. Yet companies that focus on boosting their bottom line tend to use the same tools more quickly. That gap fuels my practice because I view every case as an opportunity to fight back.
Small Shields Consumers Can Try
These steps won’t end the problem, but they may help when you need it most.
- Browse with privacy-first tools: VPNs or Firefox’s Enhanced Tracking Protection block many price-setting cookies.
- Clear cache or use incognito mode: This forces sites to recalculate without using your history.
- Compare on multiple devices: A phone-vs-laptop check sometimes reveals a hidden markup.
- Leverage price-tracking extensions, such as CamelCamelCamel or Keepa, which show Amazon’s price history and flag sudden spikes.
- Ask customer service: A polite chat often restores a lower “new-user” deal.
When Surveillance Pricing Becomes a Scam
Sometimes the line between legal marketing and unfair practice is blurry. If you see these things, you might be uncovering an illegal practice:
- Hidden fees show up after you agree to pay for something.
- Discount codes are advertised but auto-removed for certain user profiles.
- Loan or insurance quotes rise after the company figures out your race or neighborhood.
- Prices are advertised as “best” or “lowest” but you see a different price when you use a different browser or a VPN.
If you spot patterns like these, keep records, such as screenshots, timestamps, and email receipts, to document your findings. Critical evidence often vanishes once a site updates or a transaction is complete.
Take the Next Step
If you believe a lender, retailer, or service provider set a price by exploiting your data in a way that could violate the law, reach out today for a no-obligation consultation. A quick conversation may uncover legal tools, such as state unfair practices laws, that can claw back overcharges or prevent future hikes.
About the Author
Angel E. Reyes is a former federal enforcement attorney at the Consumer Financial Protection Bureau and the Federal Trade Commission. After bringing enforcement actions against the largest U.S. companies, which resulted in over $100 million returned to consumers, he left the government to open Power to the People Law PLLC. This law firm focuses on protecting people’s homes and bank accounts.
Disclaimer
Informational only. Attorney advertising. Not legal advice.