If you’re near Rochester, New York, the price for a carton of Target’s Good & Gather eggs is listed as $1.99 on its website. If you’re in Manhattan’s upscale Tribeca neighborhood, that price changes to $2.29. It’s unclear why the prices differ, but a new notice on Target’s website offers a potential hint: “This price was set by an algorithm using your personal data.”
A recently enacted New York State law requires businesses that algorithmically set prices using customers’ personal data to disclose that. According to the law, personal data includes any data that can be “linked or reasonably linked, directly or indirectly, with a specific consumer or device.” The law doesn’t require businesses to explicitly state what information about a person or device is being used or how each piece of information affects the final price a customer sees. The law includes a carve-out for the use of location data strictly to calculate cab or rideshare fares based on mileage and trip duration but not for other purposes.
The law also requires that the disclosure is “clear and conspicuous.” Target’s disclosure is not the easiest to find–a customer would have to know to click the “i” icon next to the price of an item, then scroll to the bottom of the pop-up. In the past, the courts have held that it’s not always reasonable to assume that a customer will click on “more information” links when it’s not required.
I'm sufficiently unfamiliar with New York that I had to look it up, but Rochester and Tribeca appear to be at opposite ends of the state and are presumably not served by the same physical Target store. Displaying the actual price at a location near you seems completely reasonable to me, if that's what they're doing.
But yes, there should be a mandate to explain what data is being used and how.
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