alt Hacker NewsThere was an article about targeted advertising a number of years that really changed my perspective on it called, "Targeted Advertising Considered Harmful": https://zgp.org/targeted-advertising-considered-harmful/
The basic idea is that the real value in advertising is as a signaling mechanism, and targeted advertising removes most of that signal.
I feel like personalized pricing has some of the same issues, in that it erodes consumer trust and makes it more and more difficult for consumers to confidently spend their money in the market. I am not sure how we fix the problem, though, because it is a collective action problem; any individual company will need to use personalized pricing to compete, but that behavior will hurt the economy as a whole.
I don't know the solution to this problem.
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> that behavior will hurt the economy as a whole.
I don't quite follow... Advertisers want their product sold. Consumers want to buy whichever product is most suitable for their needs (based on both price and performance), ad networks have every incentive to connect these two.
In an ideal world an ad network would show me 10 ads for products I want to buy (ie. new shoes, ice cream, etc). I would have confidence that those products are the exact ones I want and that any more research would only show up inferior (worse value) products.
The ad network gets to take no profit margin - since if it did, I could find that same product cheaper elsewhere.
This leads to an equilibrium where the ad network shows mostly the perfect products - and charges a small margin - where the margin size is set to be slightly below my willingness to shop around for a better deal.
Personalized pricing just represents different users estimated willingness to shop around - but if the model is correct, even those paying a higher price are happy with the situation or else they'd shop around.
Why isn't making it illegal a solution?
Don't ban it, just require that next to the current price merchant displays low/high/median price for the same good/service in the last 30 days.
> I am not sure how we fix the problem
Regulation that causes big business to lose money and rich people to be a little less wealthy so society is better
There's bqsically IMO two types of ads - marketing and sales.
Marketing ads are signalling, brand recognition, etc. You want the cool earbuds that everyone knows. You want to buy them from a big, reputable company with good r&d.
Sales is simpler - click on the ad and buy the product. It tends to be a bit sleasier - sales doesn't care as long as it makes a sale.
There's often a bit of tension between sales and marketing. A 50% ooff exploding offer can be good for sales in the short term, but can make the brand look cheap.