What is 'surveillance pricing,' and is it impacting you?

HOUSTON, Texas (KTRK) -- Online searches can impact prices on everything from hotels to airline tickets.

Imagine a company adjusting the price of a good or service in real time based on your personal data.

The practice is known as "surveillance pricing."

"It basically makes a different price for different people for the same product, often. It's basically pricing based on what the seller knows about the customer," Rice University Assistant Professor of Marketing, Emily Prinsloo, Ph.D., said.

Prinsloo said there are multiple reasons why companies use the practice.

"Essentially, it is a way to boost profitability and get the maximum they are able to get from each customer, but also to offer better products to customers," Prinsloo said.

ABC13 employees tried searching for a round-trip flight on a major U.S. airline going to the same location and at the same time, and they each received the same price, but when they tried booking a hotel using a popular travel website, they received different recommendations and different price points.

"It's interesting that it chose such different hotels for us," ABC13 Chief Investigative Reporter Mycah Hatfield said.

Experts say there are ways to protect yourself from being targeted.

"One thing you could do is you can definitely remove your browsing history and your cookies, and when sellers ask you to opt in or opt out of data sharing, you can opt out of that or use a VPN to browse so it will hide your location information," Prinsloo said.

The U.S. Federal Trade Commission has been investigating the practice.

"Initial staff findings show that retailers frequently use people's personal information to set targeted, tailored prices for goods and services, from a person's location and demographics, down to their mouse movements on a web page," former FTC Chair Lina M. Khan said.

Recently, states have been looking at limiting or banning the practice.

State leaders in Maryland announced and eventually passed a law banning the practice at grocery stores.

Other states are considering doing the same thing.