German study finds no evidence of personalised pricing: does it mean it's really not an issue?

In our previous post we reported about a recent study published by BEUC containing important recommendations about the future of consumer protection in the digital age. The study engaged among others with problems of personalisation in online consumer markets, including in respect of price-setting. Data-driven price discrimination has indeed been a subject of a growing interest in the literature and law- and policy making. To recall, a new information duty concerning the existence of personalised pricing was added to the Consumer Rights Directive as part of its recent reform. Member States are now in the process of implementing the new EU provisions to their national legal systems and it is open to debate whether the adopted disclosure duty will in fact be useful for consumers (see e.g. a recent OECD study). In the meantime, an increasing number of studies explore to what extent personalisation of prices actually takes place in the (European) consumer markets.

Back in 2018, the results of the "Consumer market study on online market segmentation through personalised pricing/offers in the European Union" were published by the European Commission. The study found evidence for personalised rankings of offers, but was not able to confirm the existence of "consistent and systematic personalised pricing".

Earlier this month, a report from a similar study commissioned by the German Ministry of Justice and Consumer Protection (BMJV) was published. As part of the project, the prices charged for the same products to different consumers on leading webshops and platforms were analysed over a period of three months. To assess the relevance of user characteristics for price variations a number of factors were considered, e.g. different devices, operating systems, browsers, data protection settings, user location, browsing history and social media engagement. While certain differences were identified in relation to prices charged when booking a hotel room either through a desktop or a mobile device, overall the statistical analysis did not confirm the existence of personalised pricing in the investigated markets. Interestingly as well, if price variations were observed at all they were generally marginal and typically took form of targeted discounts.

Considered together, both studies raise the question whether personalised pricing is indeed an issue for consumer law and policy. While it is clear that granular price discrimination is possible from a technological perspective, recent findings show that such a possibility may not really be used in the market practice. This could be linked to the typically negative perception of personalised pricing among consumers, as reactions to some of the previous instances of price discrimination, or even to speculations thereof, have shown (see e.g. in relation to Amazon, Allstate, Orbitz and Uber). At the same time, for these negative perceptions to actually have a regulatory effect, recurring market studies, like the ones indicated above, seem to be needed.