2005-09-02 / Columnists

Notes On Consumer Affairs

Audrey Pheffer
Audrey Pheffer “You better shop around” is more than just a catchy tag line from a Smokey Robinson song. In this day and age it also seems to be a consumer mantra, and it should be, especially when it comes to shopping on the internet. While consumers often view the internet as a vehicle for deal-savvy consumers, many would be surprised about the business practices of seemingly reputable internet retailers. “Open to Exploitation,” a study conducted by the Annenberg Public Policy Center of Pennsylvania, revealed that the majority of those surveyed were unaware of common internet retailer business practices, often to their detriment.

Many online retailers legally practice what is known as “price customization,” which is the practice of charging different customers different prices at the same time of day, for the same merchandise, based on the customers’ previous purchases. Price customization is legal so long as consumers are not discriminated against based on race or sex and anti-trust or price fixing laws are not violated. Approximately sixty- two percent of those surveyed were unaware of this practice. Online retailers often will not give lower prices to shoppers who do not investigate lower-priced alternative items on their site or to shoppers who have not visited their site before. In order to protect yourself, be sure to comparison shop before committing to a high ticket purchase online, or consider visiting offline retailers.

Consumers should also exercise caution when it comes to travel websites. According to the study, sixty eight of those surveyed were unaware that travel websites that offer comparison rates are not required to offer the lowest airline prices and often do not. Some travel websites include only a list of their preferred partners on the first page.

With travel websites, it is especially important to comparison shop before making arrangements in order to get the best deal.

Many consumers are also unaware of how frequently their personal information is distributed. Banks, charities, and supermarkets are legally allowed to share your information in various ways. Banks are allowed to share your information with the companies that they own, but you can keep banks from sharing your information with outside parties, which is often referred to as “opting out.”

You can find out more about opting out of your bank’s marketing policies by calling them directly or visiting their website.

Banks may have toll free numbers or forms for this purpose. Charities are allowed to sell your information unless you request otherwise.

Supermarkets and drug stores are also able to sell information about your purchases.

The frequent shopper cards distributed by these companies are often vehicles for collecting such information, and these companies often give greater or lesser discounts based on your previous purchases.

To learn more about the “Open to Exploitation” survey, please visit http:// www.annenbergpublicpolicycenter.org/.

For more information about protecting your privacy on the internet and in general, consider visiting the Federal Trade Commission’s consumer webpage at http://www.ftc.gov/ftc/consum er.htm or the New York State Consumer Protection Board’s website at http://www.consumer.state.ny.us/.

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