Seventeen facts American shoppers need to know — but don't

Annenberg study shows Americans vulnerable to exploitation in the online and offline marketplace.


Most Americans who use the Internet have little idea how vulnerable they are to abuse by online and offline marketers and how the information they provide can be used to exploit them, a new study led by Joseph Turow, Ph.D., of the University of Pennsylvania's Annenberg Public Policy Center shows.


The study involved telephone interviews averaging 20 minutes with a national sample of 1,500 adults who said they had used the Internet in the previous 30 days. Commenting on the findings, Professor Turow said it was "startling to find that 65% of respondents said they 'know what I have to do to protect myself from being taken advantage of by sellers on the Web.' Judging by their scores on the factual questions in the survey, their self-confidence is mistaken."


He warned that "As society moves further into the twenty-first century, prices that vary based on firms' information about us could become an increasing feature of the marketplace. Consumers who are not aware of how price discrimination works, of what rights they hold when it comes to companies using knowledge about them, and of how to respond to these circumstances may find themselves consistently paying more than others for the same products. Database-driven price distinctions could spread as growing numbers of retailers use information consumers never knew they revealed to draw conclusions about their buying patterns that they would not have wanted."


The formal report on the survey (which is available on the APPC website at www.annenbergpublicpolicycenter.org/) is titled "Open to Exploitation: American Shoppers Online and Offline." It warns that most Internet-using adult Americans will fall prey to marketplace manipulations even while many believe (incorrectly) that they know how to handle themselves.


The findings suggest that Americans' ignorance of key retail realities at a time of major marketplace changes leaves them open to economic abuse and emotional distress.


-- It is legal for an online store to charge different people different prices at the same time of day for the same product. 62% didn't know.


-- It is legal for an offline store to charge different people different prices at the same time of day for the same product. 74% didn't know.


-- By law, a site that compares prices on different products or services is not required to offer the lowest prices. 68% didn't know.


-- When a website has a privacy policy, it does not mean the site will protect your privacy. 75% didn't know.


-- When you give money to charity, by law that charity is allowed to sell your name to another charity even if you don't give it permission. 72% didn't know.


-- Supermarkets and drug stores are allowed to sell other companies information about what you buy. 64% didn't know.


-- A video store is not allowed to sell information about the titles that you have rented. 71% didn't know. It can, however, sell your name and address as someone who has rented from the store.


-- Your bank has a right to share information about you with the companies that it owns. 73% didn't know.


-- When you subscribe to a magazine, by law that magazine is allowed to sell your name to another company even without your permission. 52% didn't know.


-- A website is allowed to share information about you with affiliates without telling you the names of the affiliates. 49% didn't know.


-- Banks do not send their customers emails that ask them to click on a link wanting them to verify their account. 49% didn't know.


-- Companies today have the ability to follow your activity across many sites on the Web. 20% didn't know.


-- A company can tell that you have opened its email even if you don't respond. 28% didn't know.


-- Most online merchants give you the opportunity to see the information they gather about you. 47% didn't know.


-- Most online merchants do not allow you the opportunity to erase information they have gathered about you. 50% didn't know.


-- The national credit reporting agencies that can provide you a copy of your credit report are Equifax, Experian, and Trans Union. 66% didn't know even one.


-- The Federal Trade Commission will not correct errors in credit reports. 76% didn't know that.


SOURCE: University of Pennsylvania's Annenberg Public Policy Center