Personal data and Consumer Protection A CMA Perspective A CMA - - PowerPoint PPT Presentation

Personal data and Consumer Protection – A CMA Perspective A CMA Perspective

Jason Freeman Director of Consumer Law, Competition and Markets Authority

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E-Commerce & the Economy

CMA’s Mission: to make markets work well in the interests of consumers, businesses and the economy Online and Mobile Commerce can deliver:

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• Huge benefits for consumers
• New opportunities for businesses
• Growth and innovation in the economy

But this requires:

• Strong consumer confidence
• Fair dealing by businesses

Internet = Information economy

A place where: Traders can access new markets Consumers can access new products Traders and consumers can find out about each other!

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Information is the main currency of the internet –so this requires a market approach

The data market

Consumer interests Consumer spending Consumer habits interests

• What they search for,

write about, look at, purchase

• Valuable for

advertisers, but also retailers…

• Who has this data…?
• At what point are they

willing to pay?

• Inferred from general

consumer behaviour

• Targeted discounts –

but also personalised prices?

• A risk area for trust…

Consumer habits

• The next area of value

to be unlocked

• Midata, data lockers,

personalised products

• Requires significant

trust…

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How can technology be used to personalise prices?

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Common information based price discrimination

Location of consumer

• market factors in a particular region or higher willingness

to pay

Route to a product

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• arrive via a discount website or use a mobile device

Search discrimination

• presented with different search results based on conduct
• r characteristics

Targeted discounting

• vouchers or discounts are given based on previous

shopping habits

What information is collected?

Observed

Product

Volunteered Collected (e.g. by cookies)

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Device Operating system IP address location Past purchases from the trader Existing customer Speed of click through Address for delivery Email address Phone number Date of Birth Responses to customer surveys Route into website Other sites visited Browsing and purchasing behaviour

Building trust to unlock value

Personalised Pricing Call for Information (OFT 1489)

• Many people believe personalised price hikes happen
• People are suspicious of data collection (US data brokers refused to

answer our questions!)

• Traders in fact collect huge amounts of data about consumers and
• Traders in fact collect huge amounts of data about consumers and

want to segment market more finely to price discriminate

• Dynamic pricing is common –and can be mistaken for

personalisation

Main conclusions:

• Firms need to be much more transparent and fair about data

collection and use to build consumer trust

• Without transparency also significant risk that personalisation will be

harmful –and so warrant intervention

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Ensuring consumer trust

Collection of information

Behave fairly Transparency

Use of information – post collection Using collected information to influence the final price

Tell people if

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Transparency

• n collection

and use Transparency

• n transfer to

third parties Genuine opt-

• ut

Use for stated purpose Use responsibly Genuine opt-

• ut

Tell people if information used to set price Do not mislead about discounts, best price or RRP

Collection of information

DPA

“Fair and lawful"

CPRs

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“Fair and lawful"

• Specify purpose for

collection

• Consent or legitimate

reason to collect

• Only collect what is

necessary Lack of transparency on collection, use and transfer – misleading action/omission Lack of genuine opt-out – possible aggressive practice?

Use of information – post collection

DPA CPRs

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“Fair and lawful"

• Don’t use for unspecified

purposes (without a legitimate reason)

• Accurate and up to date

(where appropriate)

• Appropriate security

Irresponsible acquisition, use or transfer – contrary to requirements of professional diligence Lack of genuine opt-out – possible aggressive practice?

Using collected information to influence the final price

DPA CPRs

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“Fair and lawful"

• Don’t use information

to set price unless told consumers or got consent Don’t tell consumers if information is used to set price – misleading

• mission

Mislead about discounts, best price or RRP – misleading action

Personal data and Consumer Protection – A CMA Perspective A CMA Perspective

Jason Freeman

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