In Brief:
- Companies increasingly use individuals’ data to set individualized prices for goods and services. Maryland has prohibited this practice for food retailers and food delivery companies.
- Many states have been considering laws like these, some aiming for an outright ban and others simply requiring companies to disclose the practice.
- Proponents of these bans say they’re necessary to protect consumers from corporations who might abuse their data to unfairly raise prices. Critics, meanwhile, say the bans risk interfering with normal business practices.
In April, Maryland became the first state to ban surveillance pricing for grocery stores and food delivery services, setting a potential precedent for other states as consumers grow increasingly wary of companies using their data to offer them higher prices.
Critics of these pricing practices (also called “personalized pricing”) say the practice allows companies to unfairly upcharge some consumers based on their personal data.
“Grocery store chains are using reams of personal data to charge people different prices for the same bag of groceries,” writes Economic Action Maryland, a group backing the law. “With surveillance pricing, your personal data is used to adjust the price to what an algorithm has calculated you will pay. … Shoppers don’t have this information to make decisions about prices or know that their bag of groceries costs $10 more than their next-door neighbors.”
Maryland’s law was inspired by the proliferation of electronic shelf labels in stores, which could in theory be updated rapidly to display higher prices for goods based on the weather, time of day or detailed consumer data, according to the Moore administration. An earlier version of the law would’ve stopped businesses from changing their prices within the same business day.
The new law specifically bans companies from using personal data to set individualized, higher prices for consumers. The law clarifies that it does not block “temporary changes or changes to pricing” intended to retain existing customers.
Some advocates, however, say the law should’ve also barred setting individualized discounts. In theory, a store barred from upcharging based on personal data could still artificially raise all its baseline prices, then offer individualized discounts to consumers based on assumptions of what they’re willing to pay.
The Maryland Retailers Alliance, on the other hand, says the state law is completely unnecessary, especially in its focus on food retailers. The state’s existing consumer protection law already bars misleading or discriminatory pricing, the alliance says, and the attorney general “has no record of substantiated complaints indicating a pattern of grocery stores engaging in unlawful predatory pricing increases.”
New York Sen. Rachel May, who introduced a more expansive personalized pricing ban in her state, says that she hasn’t yet seen examples of New York stores using electronic shelf labels for personalized pricing or instantaneous price changes. But she says that the technological capability is there, and other legislators are seeking to get ahead of it.
There are numerous examples of personalized pricing in online stores of various types. The Federal Trade Commission (FTC) reported in 2025 that online sellers often target consumers with individualized prices based on details like the person’s location, browsing patterns and mouse movements on a webpage. The FTC review evaluated third-party companies that adjust prices on behalf of retailers ranging from grocery stores to clothing stores. Similarly, a journalist found that in 2024 and 2025, some popular hotel booking sites listed the exact same room at the same hotel for much higher prices to customers browsing from Bay Area cities, compared to customers looking at the rooms while located in Phoenix or Kansas City.
In the grocery sphere specifically, Instacart came under fire this year when New York Attorney General Letitia James warned that the company may be in violation of a state law requiring companies to inform customers when their personal data is used in algorithmic pricing. A 2025 Consumer Reports investigation found Instacart users across the U.S. were shown different prices for identical products. For example, identical grocery baskets from the same Seattle-area Safeway cost one customer about $114, while another was charged $124. (Instacart admitted to pricing experiments, but says it has never done surveillance pricing.)
Logan Kolas, director of technology policy at the American Consumer Institute Center for Citizen Research, says banning algorithmic pricing is problematic. For one, he says businesses need to be able to tweak prices to learn how much consumers will pay for an item, signaling to businesses both where to set prices to get the item to move and how much demand there is. “We need to be very, very careful about regulations on prices. Prices guide a lot of economic behavior, and by cutting it off, you can do damage to the economy in a lot of unexpected and deep and profound way,” Kolas says. “Prices are signals that guide all economic activity.”
Kolas also says personalized pricing allows companies to offer lower prices to individual consumers who would otherwise not be able to afford the goods or services. (Sen. May, meanwhile, says companies with such concerns should just lower the prices for everyone.)
Uber has been documented charging riders leaving from the same airport different prices based on their hotel destination, with more upscale hotels leading to higher Uber prices. Some people interpret this as Uber raising prices on riders going to costlier hotels. Kolas reads this as Uber selectively lowering prices for people going to cheaper hotels.
“A lot of people have this notion that they want everybody charged the same price for everything all the time. But the problem is that it can actually end up backfiring, especially on low-income consumers,” Kolas says. “There’s this presumption that algorithmic pricing has done a great deal of damage to consumers, and, really, they’ve benefited in very profound and important ways … the presumption of guilt is wrong.”
Personalized pricing in particular, and algorithmic pricing in general, are a hot topic for many states. While Maryland’s ban is the only to clear the finish line so far, other states are making their own attempts. That includes measures focused on particular categories of goods — like tickets or food — or on all goods and services. Some bills target personalized pricing while others also address surge pricing, a practice in which prices ramp up in real time in response to spikes in consumer demand, rather than based on individualized details. In 2025, 24 states collectively introduced more than 50 bills on algorithmic pricing.
“We know that corporations that have access to personal data are finding ways to set the highest possible price they can for each consumer when it’s possible to do that,” May says.
