Following CHOICE's 2020 investigation into Tinder's discriminatory pricing practices in Australia, new research by Consumers International and the Mozilla Foundation has found that Tinder Plus users in several other countries are being unknowingly charged more based on their personal information.
The research found that Tinder Plus charges older customers more money to use the service in five out of six countries investigated - India, the Republic of Korea, the United States, the Netherlands and New Zealand.
"The Consumers International investigation found that in five countries people over 30 were quoted far higher prices than people in the 18-29 age group. On average, 30-49 year olds were charged 65.3% more than 18-29 year olds," says CHOICE senior policy advisor, Amy Pereira.
"The investigation also found that other undisclosed factors are used to influence individual pricing. This can potentially be any data Tinder holds about you like your location or hobbies, but the issue is we have no idea," says Pereira.
The results of Consumers International's investigation builds on CHOICE's mystery shop of Tinder Plus in 2020, which discovered that the dating app was charging Australians vastly different prices without informing customers that this was happening.
"This new research from Consumers International is incredibly concerning, and confirms what CHOICE discovered in Australia is a global issue. Not only is Tinder discriminating against its users based on their age, there is absolutely no transparency when it comes to the pricing algorithm they are using. The big issue is that Tinder won't come clean about how they set their prices," says Pereira.
"CHOICE is calling on Tinder Australia to immediately stop its unethical use of data to set different prices for different people. We know that the hallmark of a good relationship is honesty and fairness, and it's about time Tinder starts exhibiting these qualities itself," says Pereira.
Australians can sign the petition calling on Tinder to stop its unfair pricing practices here: www.choice.com.au/tinderletter
"By signing the petition on CHOICE's website, the Australian community can show Tinder that secretly charging people different prices based on their data is both unfair and unethical. Tinder needs to come clean about how their pricing algorithm actually works and make sure that they aren't forcing people to pay more for factors beyond their control," says Pereira.
Read the full story on the CHOICE website: www.choice.com.au/tinder
Media contact: Katelyn Cameron, 0430 172 669, media@choice.com.au
Editor's notes:
Tinder's response
A Tinder spokesperson told CHOICE that the company "has never factored in sexual orientation, gender identity, or any other demographic characteristic to our pricing", adding that it recently "decided to move away from our aged-based pricing policy that provided a lower price subscription for our younger members aged 18 to 28."
Tinder also said that it had already discontinued aged-based pricing in the US, UK, Brazil and Australia.
But a quick check by a number of CHOICE staff of different ages and other demographics revealed that prices for premium options such as Tinder Plus continue to vary, ranging from $9.99 to $28.99 per month for Tinder Plus.
How was the Consumers International research conducted?
The research, titled "A Consumer Investigation into Personalised Pricing," was conducted between May and September 2021. To conduct the research, Consumers International and Mozilla worked with mystery shoppers in New Zealand, the U.S., the Netherlands, the Republic of Korea, India, and Brazil. These shoppers signed up for Tinder, provided Tinder with information on their age, gender, sexuality, and location and then shared their price quotes for Tinder Plus with our researchers.
This research builds on work by CHOICE in 2020, which investigated Tinder's pricing in Australia.
Key findings from the Consumers International study include:
-- Personalised pricing is incredibly opaque. In the Netherlands, consumers were quoted 31 unique price points. In the Republic of Korea and New Zealand, consumers were quoted 26 and 25 unique price points, respectively. And in some cases, the difference between highest and lowest prices was over 450%. In the Netherlands, prices ranged from $4.45 to $25.95 (USD). In the U.S., they ranged from $4.99 to $26.99.
-- Consumers, and the organisations that protect their rights, have little agency. Consumers are offered minimal transparency at the point of purchase on the use of personalised pricing, with unclear references to 'promotional rates' and 'offers and discounts tailored to your profile' buried deep within Tinder's terms of use. Tinder's price-setting mechanism is drawing on age and likely other unknown factors, possibly including data points beyond those provided upon registration.
-- Unfair pricing is occurring on Tinder Plus. In five of the six countries surveyed, people aged 30-49 and 50+ were quoted substantially more on average than those aged 18-29. This difference was greatest in the Netherlands, the Republic of Korea, and India. On average across the six countries, 30-49 year-olds were charged 65.3% more than 18-29 year-olds.
-- Consumers care about personalised pricing, no matter their age. To complement this research, Consumers International and Mozilla also surveyed consumers about personalised pricing. Nearly all consumers surveyed reported some level of concern regarding the use of personalised pricing, and participants aged over 30 were nine percentage points more likely to identify unfair pricing as a top concern.
-- Regulations must be enforced. The research also includes an assessment of current data protection regulations. It concludes that a holistic approach to regulation that encompasses data protection, competition, and consumer protection laws may enable the effective regulation of personalised pricing.
-- The solution is meaningful transparency and access. Businesses must be transparent in their use of personalised pricing at the point of purchase and throughout the whole process, so consumers can make an informed decision. Further: consumer associations, other think tanks, and enforcement and supervisory bodies should be given meaningful access to the algorithms that determine personalised pricing, in order to establish if the practice is fair.
