Online shoppers warned about hidden price rises

BBC

21st January, 2021 02:41:38 printer

Online shoppers warned about hidden price rises

Algorithms used by online marketplaces could lead to a rise in prices of goods and services, the UK’s competitions watchdog has warned.

The Competition and Markets Authority (CMA) is investigating businesses which use technology on selling platforms.

Shoppers could be "manipulated" into buying specific items, as search results favour certain brands, it said.

Consumers may also be shown misleading messages on these websites, suggesting items are in short supply.

Collusion between businesses on consumer spending and browsing data could lead to “sustained higher prices for products and services”, the CMA said.

'Personalised pricing'

The effect of algorithms can be difficult for shoppers to detect, the regulator warned, adding that websites could use “nudges” including the location of a “buy” button or generating “personalised pricing”.

Online platforms might also have misleading messages which suggest a product is in short supply, the CMA added.

Another issue it wants to scrutinise is how firms can use algorithms to manipulate online review scores, BBC reported.

 


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