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AII-1001-84333
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AI Pricing Algorithms Charged with Discriminatory Price Discrimination Against Loyal Customers

Consumers in China reported that e-commerce and travel platforms used AI-driven pricing algorithms to charge loyal customers significantly higher prices than new users for identical products, reportedly marking up prices 5 times or more, and adjusting prices based on user profiles and purchasing behavior.

13 March 2025 · E-commerce and travel booking platforms · Discrimination and fairness
13 March 2025
AII-1001-843332 sources ↓
Quick facts
Category
Discrimination and fairness
Country
China
Source
news.china.com
Date
13 March 2025
Drafted by
Raidu Incident Detection

What happened

Consumers reported that e-commerce and travel booking platforms used algorithms to charge loyal customers higher prices than new users for identical products and services.

One consumer reported paying a price 5 times higher than three new users viewing the same product; flight prices reportedly increased before purchase and dropped after purchase; hotel searches on different devices showed price differences exceeding 100 yuan; items placed in shopping carts reportedly increased in price after multiple views.

A journalist testing the algorithm found that after repeatedly telling a shopping platform 'I'm too poor, no money, too expensive, can't afford it,' the platform changed its recommendations from expensive phone cases to ones priced at 5 yuan.

Reported impact

Complaint platforms recorded approximately 8,306 complaints about 'big data price discrimination' concentrated in travel and shopping sectors; another search found nearly 18,000 complaints mentioning the term 'price discrimination.'

Some consumers attempted to 'train' algorithms by expressing poverty in comments and reviews; one reported reducing the cost of a Beijing-Jeju flight from 870 yuan to 369 yuan through this method.

Index analysis

Researchers found that platforms use algorithms to create consumer profiles based on purchasing habits and economic status, assigning labels that enable differentiated pricing for identical products to different user segments.

Experts noted that generative AI large language models have enhanced platforms' data aggregation and reasoning capabilities compared to earlier algorithmic systems, making the discrimination more sophisticated.

Governance controls

In November 2024, China's Central Cyberspace Administration and three other agencies launched a 'Clear Internet' campaign to eliminate algorithmic 'price discrimination,' with regions conducting related algorithm governance actions.

Market regulators stated they would strengthen algorithmic transparency requirements and optimize algorithmic rules to protect consumer rights.

Classification

Category
Discrimination and fairness
Industry
Travel, leisure and hospitality
Country
China
Harm status
Actual harm
Intent
Intentional
Timing
Post-deployment
Harm types
Economic or property, Reputational
Harmed
Consumers
Failure modes
Biased model, Manipulation or dark pattern
AI systems
Big data pricing algorithm
Regulations
EU AI Act (cited)

Sources and evidence

This record was researched and written by the Index, based on the following original reporting.

news.china.com
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