A call by new federal NDP Leader Avi Lewis to ban “surveillance pricing” is drawing fresh attention to a business practice that experts say could quietly reshape how much Canadians pay for anything from groceries to clothing to travel.
Earlier this week, Lewis called on Prime Minister Mark Carney to ban surveillance pricing, calling the practice “unfair” and “downright creepy.”
Surveillance pricing, also called algorithmic or personalized pricing, refers to the practice of retailers adjusting prices based on what they know about an individual consumer. This knowledge, gained from tracking a consumer’s online activity, can include search history, location, type of device, age and other personal data points that help estimate how much someone is willing — or able — to pay.
“Where people are quite nervous is the potential for companies to charge different prices for different people based on their income, postal code, age, and other demographics that would be perceived by society as a negative,” said retail analyst Bruce Winder.
As an example, Winder said if he was online shopping and looked at the same pair of jeans for two days in a row without buying them, the website might remember his actions and offer him a coupon on the third day.
Experts warn the same tools can be used far more aggressively — not to offer deals, but to quietly raise prices on those deemed most likely to pay.
“It’s much more invasive, predatory and discriminatory,” said policy and competition expert Vass Bednar, who leads the independent thinktank Canadian Shield Institute.
As part of his call to ban surveillance pricing, Lewis said the practice could allow retailers to capitalize on consumers who urgently need a product.
“If you’re a new parent and your baby’s sick, a corporation could charge you a higher price for a thermometer or medicine based on your search history,” he told reporters in a press conference Monday. “If a loved one dies and you need to travel on short notice, you can be charged more for a plane ticket if you got an email about funeral arrangements.”
The Retail Council of Canada, which represents retailers, has not encountered examples of surveillance pricing according to council executive Karl Littler. He acknowledged the tactic has been reported in sectors such as travel and ride-hailing in the United States, but downplayed the likelihood of it occurring in Canada.
U.S. non-profit Groundwork Collaborative found that companies such as Instacart have layered on fees and pricing structures that can obscure the true cost of goods.
In a report examining the grocery delivery platform, Groundwork concluded that such practices can “inflate grocery bills for families already struggling with high food prices,” pointing to a lack of transparency around markups, service fees and algorithmically adjusted costs.
Unlike dynamic pricing where costs rise and fall based on demand but remain the same for all customers, surveillance pricing operates at the individual level.
“It’s not about supply and demand,” Bednar said. “It’s about extracting the maximum possible price based on information that someone didn’t necessarily knowingly volunteer.”
She said that distinction matters, particularly as online shopping makes it easier than ever to segment consumers.
Ningyuan Chen, an associate professor of management at the University of Toronto, said technology has made it easy for retailers to adjust online prices in real time.
“They know more about us and because we all have different details, we see different versions of the items,” he said.
In Toronto, chains with franchises like McDonalds charge different prices for the same items at locations across the city, with some varying by up to 30 per cent.
According to polling released by Abacus Data, a large majority of Canadians view algorithmic pricing as unfair, with many supporting government intervention or outright bans.
The firm found that Canadians are “deeply skeptical” of the practice and worried it could be used to take advantage of people based on personal data or urgent need, blurring the line between innovative pricing strategies and exploitative behaviour.
In January, the Competition Bureau Canada released the results of its public consultation into surveillance pricing. In a report published that month, the Bureau noted that participants raised alarms about the potential for pricing algorithms to enable businesses to respond instantly to competitors’ price changes, possibly driving prices higher without explicit collusion.
The Bureau summarized feedback from citizens and stakeholders, warning that these tools could “reduce competition and harm consumers” if left unchecked, particularly in concentrated markets where a handful of firms dominate.
For Bednar, the issue cuts across multiple areas of law and policy. “It’s at that intersection of consumer protection, competition law and privacy law,” she said, arguing existing frameworks may not fully capture the risks.
“Most provinces have laws on price gouging. This is a form of price gouging, just supercharged by AI and data.”
And while the practice remains largely invisible to consumers, that opacity may be part of the problem.
“We won’t know if companies are doing it or not unless you compare notes with someone,” Winder said, warning that even the perception of unfairness could erode trust.
Bednar advocates for legislation that would force companies to disclose what algorithm was used to a set a price, adding that it wouldn’t solve the problem as regulators can’t discipline a market they don’t know.
“People should be concerned. The more people discover and learn about it, the more revolted they are,” she said. “There’s a revulsion, there’s a resentment.”
With files from Mark Ramzy
