Citizens Advice response to the Consultation on Improving Price Transparency and Product Information for Consumers
The Citizens Advice Consumer Service provides practical and impartial advice to help people resolve issues relating to consumer law. The service receives around 3400 contacts a day, giving us unique insights into the kinds of consumer issues that affect people every day, including issues related to pricing transparency and drip-pricing.
Our own data shows that poor practice around pricing transparency and drip pricing can result in consumers spending more money than they expect for products and services. But it is also important to note that these practices stand to affect many more consumers than those who will come forward for help or advice. Indeed, these practices can fall under the radar, meaning people may not even notice when they have suffered financial detriment.
Pricing transparency is integral for ensuring that people are able to identify products and services that offer them good value, and can effectively shop around between different suppliers. Against the backdrop of cost of living pressures, where families are looking for every opportunity to reduce their household expenses, pricing transparency is even more important. We are, therefore, pleased to see the Department for Business and Trade’s consultation on Improving Price Transparency and Product Information for Consumers.
We support measures that will improve price transparency, including requiring unit price to be displayed alongside promotional offers. We also support measures to reduce the detrimental impact posed by drip-pricing. Where fees are mandatory and unavoidable we believe these should be incorporated into headline costs, to make it easier for consumers to compare costs. We have also set out a suggested framework approach to help firms determine what items ought to be included in headline costs and what could be considered an additional or optional cost. This is set out In our response to Question 20.
More generally, we are also concerned about how design features can be used to exploit behavioural biases, which can result in consumers paying more than they need to for products or services. Drip pricing is just one example of such practices, but there are many other design features that can result in people paying more for products that do not feature in this consultation. This includes the use of default settings, settings that automatically enrol people into rolling contracts, countdown timers and scarcity claims – amongst others. Where deployed without the best interests of consumers in mind, these tactics can be used to trip people up. For example, our report Tricks of the Trade: how online customer journeys create consumer harm and what to do about found that more than two in five people (41%) think websites often make it too easy to make the wrong choice. This report explored research and examples from behavioural economics and impactful regulatory interventions that show how the design of online shopping is crucial in how consumers make choices.
Our recent report Pushed to Purchase: Counting the cost of deceptive digital design in e-commerce demonstrates that poor design is costing consumers significant amounts of money. In the last year 1 in 6 people reported that they had bought something that they didn’t want, need or regret due to the design of the website. We estimate that in the last year alone this has cost consumers £2.1 billion.
It is clear that online design is not working for consumers.
There is an opportunity to use the Digital Markets, Competition and Consumers Bill to ensure that consumers are well protected from design harms. In our response to questions 45-49, we explain how this could be achieved through an expansion of the definition of professional diligence, to ensure that good faith incorporates design. This will better protect people from design practices that are resulting in harm now, as well as reducing the likelihood of new harms becoming entrenched in the future.