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Online prices can vary by ZIP code

When you're shopping online, you may be charged a different price depending on where you live, a news report says.

By Karen Datko Dec 28, 2012 1:38PM

Image: Couple Making Online Purchase © Fuse, Getty ImagesWhy would Staples.com offer a stapler at $15.79 to one online customer but advertise the same stapler at $14.29 to another who lives just miles away? It appears that customers who live close to a brick-and-mortar store operated by a Staples competitor are presented with a lower price online, The Wall Street Journal reports. 

 

The Journal has done a marvelous job explaining how our online activities -- including how we connect to the Internet and what we look at -- are used by companies to target ads at us. For instance, it reported last summer that Orbitz was showing rooms in higher-priced hotels to Mac users because they're inclined to spend more than PC users on accommodations.

 

In the latest report, the Journal says Staples.com appears to change online prices based on what it believes your proximity is to its own and major competitors' stores, as indicated by your computer's "address."

 

The Journal did exhaustive testing of online prices displayed to customers of Staples.com across the U.S. It said:

"In the Journal's tests, ZIP codes whose center was farther than 20 miles from a Staples competitor saw higher prices 67% of the time. By contrast, ZIP codes within 20 miles of a rival saw the high price least often, only 12% of the time.

 

"Staples.com showed higher prices most often -- 86% of the time -- when the ZIP code actually had a brick-and-mortar Staples store in it, but was also far from a competitor's store."

Not only that, but the Journal's study showed that those who live in higher-income areas are most often being shown the lower price. The Journal explained:

"In what appears to be an unintended side effect of Staples' pricing methods -- likely a function of retail competition with its rivals -- the Journal's testing also showed that areas that tended to see the discounted prices had a higher average income than areas that tended to see higher prices."

Thus, it appears that if you live far from areas of big-box stores and huge malls -- like on the plains of north-central Montana -- you'll see the higher price online. In fact, the Journal has an interactive page so you can check how your ZIP code fared in the Journal's test of the stapler price. My ZIP code -- where there's no Staples, OfficeMax or Office Depot within 100 miles -- got the higher stapler price every time.

 

That doesn't seem fair, but it's not illegal. It also makes business sense. Since I live where there's no major competition like OfficeMax or Office Depot, Staples has no incentive to offer me the better price.

 

However, it's also disconcerting. Haven't we expected the Internet to help us find the lowest price? When I visit a price comparison site, will the lowest offer be available to me when I actually click through to the retailer's website?

 

And it's always uncomfortable to learn that companies know so much about us. Says the Journal:

"The Journal identified several companies, including Staples, Discover Financial Services, Rosetta Stone Inc. and Home Depot Inc., that were consistently adjusting prices and displaying different product offers based on a range of characteristics that could be discovered about the user."

More on MSN Money:

16Comments
Dec 28, 2012 10:30PM
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I'm sick of being followed around by marketers. Look at a refergerator...suddenly almost all the sidebar ads show refergerators. It's **** and I'm getting tired of it.

 

Listen here you marketing bastards. I will NEVER buy ANYTHING that I think has been following me, I feel I'm being stalked  :p

Dec 29, 2012 12:18AM
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""In what appears to be an unintended side effect of Staples' pricing methods..."

No, that side effect is FULLY INTENDED.

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"Since I live where there's no major competition like OfficeMax or Office Depot, Staples has no incentive to offer me the better price."

But everybody with access to Staples' web site also has access to the competitors' web sites.
Dec 31, 2012 7:35AM
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This practice may not be illegal, but it is definitely unethical. The double standard is simply unfair to consumers.
Dec 29, 2012 10:51AM
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I agree!  And just because I had to put a zip code in to GET a price, now every piece of news comes from my zip code!  I've even changed the zip codes to another state, and while it works the first time, as soon as I reboot, my own zip code takes over!   Pisses me off.  This marketing harassment carp should be BANNED!  lol

 

 

Dec 29, 2012 2:14AM
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You can stop some of this silliness by using two free Extensions in Firefox.  The 1st is NoScript and the 2nd is AdBlock Plus.  The 1st stops most tracking and info gathering scripts when you visit a site.  It may make your browsing a little more difficult but you can temporarily override NoScript  all or in part.  The 2nd blocks advertisements and is highly customizable.

These 2 extensions are also available in Chrome but are nowhere as effective as the Firefox versions.  Of course, nothing this good exists for Internet Explorer.

Dec 31, 2012 7:51AM
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If you are shopping online and the Staples price is too high, buy elsewhere.   I'm guessing you will get the same price on Amazon regardless of which state you are in.
Dec 31, 2012 5:49AM
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Our personal data is undervalued equity that should be leveraged for OUR benefit instead of corp. greed!  One day it's going to happen, the personal data of all of us will be a protected asset like money in bank.
Dec 28, 2012 8:29PM
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Looks like the work around would be to find the zip code with the lowest price, order it and then have it shipped to the higherr priced zip code.

 

Years ago (pre internet) I discovered that the twin fair discount chain had different pricing in their suburban stores than those closer to the more populated urban areas. When I asked a worker why, they just said that the urban locations had a higher level of loss and prices were higher to reflect that level of loss.

Dec 31, 2012 2:40PM
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It seems like the most intelligent people get the best prices, and the rest pay too much.  There are so many bogus tricks that retailers play now, that you really need to understand their game in order to get a good deal.

I bought a microwave at walmart recently.  In store, it was $125.  I ordered it online at walmart.com, did the 'ship-to-store' option, and basically got the very same product within a few hours at the very same store for $100.  It's just goofy.

I recently saved over $100 on some stuff at OfficeMax, just by learning their game.
Dec 31, 2012 2:28PM
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""The Journal identified several companies, including Staples, Discover Financial Services, Rosetta Stone Inc. and Home Depot Inc., that were consistently adjusting prices and displaying different product offers based on a range of characteristics that could be discovered about the user."

Read the article today about how airlines want to do this very same thing, like they  haven't screwed Americans enough.  They will charge you a higher price if you DON"T give up your personal information.  If you do, they want to know ALL of your purchases and movements before and after you travel and then maybe..... they'll give you a better price.  Plus, they don't want to divulge full price even when you are purchasing the ticket so they can charge you again when you get to the Airport for some BS fee they 'didn't tell you about' when you bought your ticket.  These practices would be considered STALKING anywhere but the Corporate board room.  What's worse is that the people making these decisions fly in and out of the Taxpayer funded EXECUTIVE airports, unmolested by TSA, baggage fees, 8 hour flights without meals, etc.   This type of marketing is better described as War against the middle and lower classes since the study already revealed that lower prices were ALWAYS displayed for those who lived in a 'better' zip code.    This isn't India but with the Retaliban Party representing the top 10% earners and ONLY the top 10% earners, along with reducing the role of women in society (See Fox Media dumb blonde image), their march towards Plutocracy is evidenced by corporations like Staples, the Walmart of office supplies who have put so many main street businesses out of business, they can steal from the public by zip code without fear of criminal prosecution.  
Dec 31, 2012 1:45PM
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Exactly why I use the internet to compare prices and then go to the store to purchase. Usually by the time you factor in delivery costs and time it is cheaper to visit the store near me.

 

 

Dec 29, 2012 3:34AM
Jan 9, 2013 10:37PM
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I will continue to do the majority of my shopping in brick-and-mortar stores.  I prefer to see and handle merchandise before I buy it, especially clothing.  There, problem solved!
Dec 31, 2012 10:35AM
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This is propaganda, everyone knows Mitt Romney is involved with making staples a success.  MSN is still bashing him, even after the election.  How sick is that?  Did you folks ever think that  computer technology would not be used against us.  The IRS uses it to track us.
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