Online price manipulation: why can one buyer pay significantly more for the same product than another?

Mr. Vėgėlė has lived in Denmark for more than 10 years. A man with experience in banking has developed an e-commerce platform. RVLhub.com, which is believed to help combat widespread price discrimination around the world, is changing the way people shop online and the way companies sell their products or services.

The price is determined by the private information collected.

“In today’s society, we all imagine price as an indisputable fixed number established in a store, and it cannot be changed. This is not true. The price is the amount for which the buyer wants to buy and the seller wants to sell. This should be of mutual benefit.

But right now, everything is being delivered for mass sales and the prices are being set because that way, it is easier and more efficient. There was not much negotiation online at the time. Only after entering the auto repair shop and communicating live, it is often possible to negotiate the conditions and the price, ”says P. Vėgėlė.

It points out that consumer profiles, which determine which buyer is willing to pay the most, are often determined by private information collected online. It is collected by companies that use cookies on their websites. Biscuits).

After visiting the website, the cookie continues to track what you are looking for online, what products or services you are interested in. Information gathering can often come down to details like your taste in color or a particular design.

This is not to say that all this information is collected, as different sites often choose different criteria for user analysis. Some may collect information about which device they are connecting from, be it a tablet or mobile phone. Others monitor consumer behavior at the time of purchase and still others monitor their location.

Another example, according to P. Vėgėlė, is most notable in the tourism market. A user searching for a hotel or rental car will be shown a different price depending on the location from which they are searching. And, let’s say, when looking for airline tickets, with the same flights open every day, prices will go up accordingly. Consumer behavior is analyzed, so if a person is interested in tickets, despite price changes, they will still buy them.

The interviewee gave another example: “Let’s imagine a situation in which you come to a physical store with a friend and you want to buy a computer. When you come to the counter, you pay 1000 Eur, because the seller knows that you have more money, you buy often and as a result you can pay more.

However, when your friend puts the same computer on the counter, the seller only mentions € 500 because he has information that this user’s income is much lower than yours, and he almost never buys computers. Although such a situation is unlikely to occur in real life, it illustrates today’s everyday life in the virtual shopping space. “

RVLhub.com The founder of the electronic platform, he adds, found a study a couple of years ago that looked at fluctuations in product prices per month in one of the largest electronic markets in the world. stories. The result was not surprising, but it only showed that one person visiting the site can see a higher price than the other, even though they both buy the exact same product.

According to him, most of the largest retail chains, travel agencies and others. Online business areas manipulate prices and sell a product for as much as they know the buyer will be able to afford.

“I think a lot of people would feel cheated into spending more on the same product just because the company knew that the person had a higher income or tends to spend more on a certain group of products,” says P. Vėgėlė.

“When you go to a physical store, you can be sure that you will normally get the same price as another buyer. All stores have loyalty programs that offer discounts, and most people do not know that it is possible to negotiate in the usual merchandising stores, which usually offer an additional discount, ”he says.

How do companies collect data about you?

According to him, there are increasingly sophisticated ways to send emails. stores attract more shoppers. One of them is cookies. For example, if you search for a bike through Google search, you will receive bike deals at all social media locations where you sign up for at least the next 14 days.

“Obviously, this data is used according to our online behavior, and this is happening despite the change in the law, where people have to specify for themselves which cookies they will accept when entering the site. The only problem is that most people accept all cookies, because if they do not accept them, they will not have any content on the site or they will not be able to access the site, so they will not accept cookies without losing access ”, explains the interlocutor .

Internet giants like Facebook, Google or Amazon, he said, make money from our data: “The most interesting thing is that we think of Google as a free site to search for information, but by typing what we are looking for and clicking on different sites.” On Google Search, we sell our behavioral information for free. The giants have amassed billions of this information technology. Facebook and Amazon work too.

Algorithms decide what news we read on Facebook and present what we want to see just to get our attention as much as possible. The focus is on the new data currency. And if you already know what you need at the moment and you are only looking for more expensive products, obviously if you make a more attractive offer, you will buy it ”.

Price comparison sites are said to work on the same principle. According to P. Vėgėlė, companies pay money to appear in the search for price comparison sites, where prices are usually lower than when they go directly to the official website of the company. Price comparison portals are said to make money from corporate advertising, like Google, and contribute to an even bigger price manipulation problem.

“In Denmark, where I live, buyers often use price comparison sites. The business model for these sites is based on Google’s principle that prices are manipulated, so when you often go directly to a product site and search for the same product through a price comparison site, you will see two different prices for the same product at the same time. It can also be a difference of several hundred euros ”, says e. founder of a business startup.

Prices are manipulated without consequences.

According to him, there are currently only two main ways that can partially help to manage price transparency in the markets. The first way is by law, for example, applying to the State Service for the Protection of Consumer Rights or other institutions, but the fines are so rare and small that they mean nothing to companies.

The second way, he says, is to leave negative comments on the company page, but that does not change the situation, the buyer remains deceived, frustrated and the company pays little attention to him and continues to do the same.

“Companies can participate in price manipulation with practically no consequences, and the poor consumer suffers from this and continues to be misled by various sales, such as Black Friday or other holidays,” says Vėgėlė, adding that when evaluating the historical statistics of Price comparison sites, In fact, prices before the holidays go up, giving the consumer the image of a big promotion.

Is it possible to avoid online tracking?

When asked if it is still possible to protect yourself from online surveillance these days, the interviewee assures that not many of these methods exist. For example, your browser’s incognito mode stealth can help you shop online, usually only if the price of the item you are purchasing is determined by location.

There are also services such as virtual private networks. VPN – Virtual Private Network) to change the navigation location. However, this service is paid, so here are questions about why the user has to pay to be tracked and analyzed.

In order to create an e. Lithuanian created a start-up company for the commercial market RVLhub.com. According to him, the. The trading platform fundamentally changes the habits of how consumers shop online and how companies sell their goods or services.

“As much as we try to find e. Similar transparent. start-ups creating a commercial market have lost ground. We believe this is a difficult task in an effort to improve the market, so there are not many alternatives, ”he says.

Buyers created on your profile site can request products for which companies with their profiles can send their personal offers. There are no products or prices on this site. The product search works on a completely different principle: the buyer himself requests the desired product and enters the desired price. There is direct competition between companies to bid better, so company size, advertising budget or Google no longer matter.

“If I want a new phone, I search for the specifications that I want to have on my phone, and I can also enter a certain price that I want to pay for that phone. If I know exactly what kind of phone I want, I can upload a photo and say 20 percent. Discounts.

Businesses dealing in electronic products will be notified of the request and will have 24 hours to submit a personal offer. I can get a total of up to five offers, they are valid for 24 hours. If I like one of the suggestions, I can accept it. Then the company receives my email. mail and contact for the transaction. If I don’t like any of the proposals, I can reject them all and create a new request ”, says the founder of the platform.

“Our e. Commerce analysis shows that people no longer have time to search for the best deals and products on corporate websites, they want personality, and they save more than ever. It is this crisis that has forced people to look for a much simpler and cheaper way to buy online ”, points out P. V<2FEMININE>gĠl negot and hopes that her launch will become the pioneer of transparent commerce in the future.