A recent poll indicates that a significant majority of Canadians are in favor of banning or regulating the use of algorithms in pricing strategies. This public sentiment is largely driven by a perception of unfairness, as half of the respondents believe that algorithmic pricing leads to different individuals paying varying prices for the same product.
The Abacus Data poll, which surveyed 1,931 Canadians online, defined algorithmic pricing as the real-time adjustment of prices based on various factors, including the identity of the buyer, the time of day, and their browsing behavior. The findings reveal that 52 percent of participants advocate for a complete ban on this pricing strategy, while an additional 31 percent support stricter regulations, suggesting a widespread desire for intervention in this area.
David Coletto, CEO of Abacus Data, highlighted that even though many people may not be fully acquainted with the term "algorithmic pricing," they have likely experienced its effects in everyday situations. He emphasized that the core issue surrounding the use of such algorithms pertains to fairness: “For the same product or the same service, the price should be the same for everybody,” he stated.
Vass Bednar, managing director of the Canadian Shield Institute, notes that while companies have employed algorithms for price setting for some time now, recent advancements enable personalization down to the individual consumer level. This capability marks a shift away from traditional pricing models and aligns more closely with a consumer's maximum willingness to pay rather than a flat rate applicable to all.
Algorithmic pricing practices have been largely established in sectors such as travel but are increasingly manifesting in retail and rental housing markets. Coletto pointed out the distinction between traditional pricing strategies—such as airlines charging higher fares for last-minute flights—and newer practices where different customers may be charged variably based on their historic behavior and perceived financial capacity.
Bednar explained that airlines, for example, now utilize up to 1,000 data points to optimize ticket pricing for each customer. The widespread application of algorithmic pricing is not limited to online environments; it is also becoming apparent in physical retail locations. As noted by Coletto, even physical signage has become dynamic and capable of adjusting in real time.
On a related note, on Tuesday, the Manitoba government announced new legislation prohibiting retailers from leveraging personal data to raise prices for specific consumers. This regulation will extend to both in-person shopping and online transactions. Coletto commented on this legislative development, suggesting that the action taken by Manitoba could indicate a growing political pressure to regulate this emerging issue, particularly as other provinces may follow suit.
Bednar expressed that the Manitoba government's decision, led by Premier Wab Kinew, is instrumental in initiating a national dialogue on the implications of algorithmic pricing. This suggests that the conversation surrounding the ethical use of data in pricing is gaining traction among lawmakers and the public alike.
The Abacus poll was conducted from March 4 to March 11, although the polling industry’s guidelines indicate that online surveys do not carry a margin of error due to the non-random nature of the sampling method utilized.
