What it is: a price set by data about you
Surveillance pricing works like a store clerk who checks a file on you before quoting a price. Imagine the file lists your age, your neighborhood, your shopping habits, and how often you came back to look at one item. Online, the file is a data profile and the clerk is software. 1
Two people can look at the same product at the same moment and be offered different prices. 2
How it differs: dynamic pricing follows the market, not you
Dynamic pricing changes the price when the market changes. Rideshare fares climb after a big event because demand is high, not because of who is asking. The difference is what drives the price, not how often it changes.
Posted discounts for seniors, students, or the military are not surveillance pricing either. Everyone can see the terms and who qualifies.
Surveillance pricing works differently. A company can use what it knows about you to set your price without telling you. 1
How it works: companies collect, profile, and price
Collect.
Companies gather data as you browse, shop, and move around. They buy more from data brokers.
Profile.
They combine that data into a profile of you and add guesses, such as your income or education level.
Price.
Software applies pricing rules to your profile and picks the price or discount you see. The shelf price can stay the same while different shoppers receive different discounts.
The tools already exist. In January 2025, Federal Trade Commission staff reported early findings on firms that retailers hire to set and target prices. Their tools can use a person's precise location or browsing history to show that person a different price.
The firms studied had at least 250 clients, including grocery stores and apparel retailers. The findings were preliminary, and the study was still under way. 3
Why it matters: companies control how your price is set
This kind of pricing gives companies an information advantage and more power over what shoppers pay. They use data and pricing rules that shoppers may never see, making prices harder to understand or contest.
A price tag should describe the product, not the person holding it.
People who can least afford it can end up paying more. In May 2025, Consumer Reports found that Kroger estimates the income of its loyalty program members, and that those estimates can be wrong. A shopper profiled as having a lower income or less education could receive fewer of Kroger's best discounts. 4
Smaller businesses without extensive customer data can be at a disadvantage. 1
[Story from a community member]
One question remains open. Federal and state officials have investigated surveillance pricing. Limited corporate disclosure makes it difficult to determine whether it leads to illegal price discrimination. 1
What states can do: investigate, enforce, and set a clear rule
States can act in three ways, and California offers an example of each.
Investigate.
In January 2026, California's attorney general asked retail, grocery, and hotel businesses how they use personal data to set prices. 2
Enforce existing law.
In March 2022, Target agreed to pay $5 million in civil penalties to resolve false advertising and unfair competition allegations from eight California district attorneys. The settlement bars technology that raises prices in its app solely because of a user's location. 5
Set a clear rule.
California's AB 2564 proposed restricting retailers' use of personal information to set individualized prices. 6
States can also strengthen privacy protections and give enforcement agencies the resources they need. 7
We work to end surveillance pricing.
Sources
Definition of surveillance pricing, the contrast with dynamic pricing, posted group discounts, data brokers, inferred profile data, the disadvantage for smaller businesses, and the limits of what is known about illegal price discrimination.
TechEquity Collaborative, blog explainer, April 29, 2026. https://techequity.us/2026/04/29/surveillance-pricing-explained/Back to the text ↑Consumers buying the same product at the same time may be offered different prices. Letters to retail, grocery, and hotel businesses about personal data and pricing.
California Department of Justice, press release, January 27, 2026. https://oag.ca.gov/news/press-releases/data-privacy-day-attorney-general-bonta-focuses-surveillance-pricing-complianceBack to the text ↑Pricing tools can use precise location or browsing history to target different prices. The firms studied had at least 250 clients. The study was ongoing.
Federal Trade Commission, press release on initial staff findings, January 17, 2025. https://www.ftc.gov/news-events/news/press-releases/2025/01/ftc-surveillance-pricing-study-indicates-wide-range-personal-data-used-set-individualized-consumerBack to the text ↑Kroger's income estimate can be inaccurate, and a shopper deemed lower income or less educated could get fewer of its best discounts.
Consumer Reports, press release, May 21, 2025. https://www.consumerreports.org/media-room/press-releases/2025/05/consumer-reports-investigation-uncovers-krogers-widespread-data-collection-of-loyalty-program-members-to-create-secret-shopper-profilesBack to the text ↑Target agreed to pay $5 million in civil penalties. The settlement bars app price increases based solely on a user's geographic location.
Ventura County District Attorney, news release 22-017, March 11, 2022. https://www.vcdistrictattorney.com/wp-content/uploads/2022/03/22-017-Target-Corportion-Reid-Settlement.pdfBack to the text ↑State privacy protections and resources for enforcement agencies as TechEquity priorities, and the goal of ending surveillance pricing.
TechEquity, public request for proposals, "Our work." https://techequity.us/our-team/request-for-proposals-web/Back to the text ↑
Cite this resource: TechEquity Collaborative, "Surveillance pricing, explained," updated [date], [page address].