Investigating Personalized Price Discrimination of Textile-, Electronics- and General Stores in German Online Retail

Badmaeva T., Hüllmann J. A.

Abstract
Developers of pricing strategies in e-commerce businesses see a wide range of opportunities for deploying online price discrimination techniques given their ability to track consumers' online identity and behavior. In theory, an in-creasing use of personal data enables organizations to show every single con-sumer their own personalized price, which is determined by the consumer's char-acteristics, e.g. age, gender, surfing history, or location. This paper aims to ex-plore the existence of online price discrimination activities within the German e-commerce market using a three-method approach. First, inquiring the online re-tailers via email and investigating their public documents; second, surveying stu-dents; and third, using a software crawler to simulate surfing activity. Our results do not provide any evidence of individualized price discrimination, which, we argue, is due to economic and political reasons, not technical reasons.

Keywords
online price discrimination; tracking; privacy; e-commerce; personalization