Discrimination vs. Customization

Last week at an office event a colleague and I were discussing internet marketing and advertising. My colleague expressed dissatisfaction at some ads he had recently seen on his browser for cars and vans.  He felt that in 2016 e-marketers should know enough about him, his habits, and his buying preferences that advertisements should be tailored to his tastes.  Not only did he not currently own a car, but he also wasn’t interested in purchasing or renting one making the vehicle ads seem random.

I felt a bit shocked hearing this.  I always consider it a secret accomplishment when I can derail e-marketers from learning about my buying habits and tastes.  In the last few years, I’m careful about how often and when I search online for things I wish to purchase.  Although I’ve never personally substantiated it, I’ve often heard stories about prices changing from one search to the next based on any number of factors.

Over the summer one of my techie friends told me that online travel companies will typically charge Apple users more because Apples are expensive products.  I guess the thought behind that is people who are willing and able to spend more on their technology may also be willing to pay more for travel.

Price discrimination has always existed, but in the pre-digital world vendors were somewhat limited about what they could find out about you.  Most likely it would have been based on physical attributes (i.e. brand/type of accessories, clothing, amount of make up worn, mode of transportation, etc.) and maybe anything else readily available through asking questions (i.e. district of residence, education level, salary range, etc.).  Buying was done in person.

However, online companies access and collect all kinds of new data (e.g. type of device used, location, buying history, membership, etc.) that can be used either for our benefit, or detriment, with pricing.  It seems the biggest challenge is not that companies are doing it, but rather in how they are doing it and how little we understand about the process.  It’s not obvious anymore.

So is “customization” really a benefit?  Perhaps some of the time when you receive coupons or offers for all the products/services you enjoy best.  But how would you know the price wasn’t raised substantially before you received that coupon? Or what else the vendor can use your buying history and preferences for in the future?

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