How would you feel if you walked into a shop to have the price of the item you wanted to buy dictated to you at the checkout, depending on the whim of the cashier?
“That box of teabags will be £2.50 for you, madam,” a shop assistant might say. “But 50p for the gentleman next to you.” Or “Where do you live? Edinburgh? Oooh, that’ll be a premium of an extra £1 compared to this chap’s bill. He’s actually from Aberdeen.” It sounds crazy, but that is what shoppers are experiencing online on a daily basis. Of course, in real life, you would be able to see that others were being charged more than you. Online, you are merely wandering around blind in a quagmire of consumer confusion.
The internet makes it impossible for us to know what things cost.
Why? Because web companies can charge whatever they like. High street firms cannot. A person walking into a shop needs to be told immediately what any given item will cost. They know that a person standing next to them at the checkout is going to be charged the same.
Online, however, you have no idea what number will pop up on your computer when you click that “buy now” button. A recent investigation by a Channel 4 consumer programme Supershoppers found that two people sitting at a computer at the same time, booking the same holiday through the same website, were charged different prices.
Consumer experts believe that the price can differ if a shopper is using a more expensive tablet to access the internet, what area they live in and even what sites they have previously visited. In short, they are profiling shoppers to decide whether they will be able to afford the item at a premium price.
Why? Basically, because they can.
Indeed, companies can get away with murder online – and the demand for their services will nevertheless continue. The number of people shopping on the internet has rocketed in the past 12 months. The latest figures from the British Retail Consortium out this week showed that more than a fifth of all non-food items sold in the UK in January were purchased via the internet.
Of course they were. Two thirds of people in Scotland has a smartphone, according to Ofcom’s latest State of the Market report, while 52 per cent has access to a tablet.
A lot of people mindlessly shop online while they are watching TV, a sort of itch to scratch while your brain is otherwise engaged. Second screening at its finest.
It is also a commonly held belief that the internet offers the opportunity to snap up bargains not otherwise available in “real life” shops.
As documented in this column previously, offers which often seem too good to be true – Amazon’s annual Prime subscription, for example - which offers free next day delivery on a large proportion of its goods - can turn out to be as expensive in the long run as shopping elsewhere, as the base price of some products can on occasion, be higher than on other sites.
New legislation is set to be brought in later this year by the European Union which will attempt to address one aspect of this problem: that people from different countries are charged more for the same service.
It came to light after consumers flagged to the European Commission that car hire companies were squeezing extra pennies out of people living in wealthier areas of Europe. A vast number of the complaints, Brussels officials tell me, came from the UK, where the cost of living is relatively high, encouraging companies to push up costs.
People booking a car for a week’s holiday in Spain were often, the EU found, being charged more if they were living in the UK at the time of booking, than in countries such as Bulgaria.
The logic is that a service, such as car hire, costs the same, no matter whether you are booking it from.
Of course, this applies to situations where the product or service is the same. Booking a car in Bulgaria would inevitably be cheaper than booking one in Sweden, due to the higher costs of running a business in Scandinavia compared to eastern Europe. And that is fair enough.
But under the new rules, the EU aims to stamp out discrimination against people based solely on their country of origin. Part of the EU’s single market policy.
Of course, depending on the outcome of the Brexit referendum, we may have to work out a way of enforcing new laws surrounding this issue.
But while we still have protection, it can only be a good thing.
The problem does not just apply to car hire. People booking a single flight from the UK might find they are charged more than someone booking a one way flight from the Polish site of the same airline. Or an accommodation provider in Italy could sneakily plan to cash in on the deeper pockets of those from Germany compared to a tourist travelling from Estonia.
Delivery costs, however, are allowed to be different – it may cost a French company far more to export to the UK than it does to nip it across the border to Belgium, for example.
Yet while these rules are welcome, tackling geographic discrimination only scratches the surface of the problem. Consumers need to help themselves and that means shopping around. By clearing your browsing history, you can avoid letting retailers that you recently forked out £600 on a brand new iPhone or that you spend your lunchbreaks browsing Swiss watch websites. Use a different method of accessing the internet if you can – it may be a cheaper tablet offers a bargain deal which a top-of-the-range iPad cannot.
Sneaky? Yes. But not as sneaky as the retailers who are out to squeeze every last penny wherever they can.