Price Scraping Exposed: Who is at Risk and How to Prevent it?
Cyber Risks & Threats | January 17, 2024
In the competitive world of e-commerce, businesses face a subtle yet persistent threat – price scraping.
As the global online marketplace expands, so does this shady practice, which involves collecting pricing information from websites.
Opinions on the ethics of price scraping are divided. While it might initially appear that the practice means collecting mainly publicly available pricing information, there is something malicious and harmful behind this process.
By scraping prices, competitors can manipulate the market and undercut legitimate businesses.
Let’s dive into the article and understand better what price scraping is, what makes it harmful, how it can hurt your business, and, most importantly – what you can do to prevent it.
What is price scraping?
Price scraping is the practice of extracting pricing data from websites and online platforms. In this process, fraudsters use sneaky software bots to steal pricing data.
These bots crawl through websites, identifying and collecting product prices, promotions, and other valuable data that helps them uncover your overall pricing information. Competitors then can leverage this information to undercut their prices, adapt their pricing strategies, and gain an unfair advantage.
How does it work?
Fraudsters employ scraper bots to extract price information from target websites. These bots automate the process of price scraping and collect price information for specific products. These attacks are not limited to a single website or product; in many cases, competitors aim to gather information about all their rivals.
For instance, a new online store specializing in winter boots may want to understand the pricing strategies of as many competitors as possible. This information allows them to compare prices for the same boot models, observe price fluctuations, evaluate discounts, and more.
It’s crucial to note that these malicious bots often go beyond collecting current prices. They delve into historical product price changes, offering insights into competitors’ pricing strategies, special offers, discount strategies for returning customers, sales frequency, referral schemes, and affiliate codes.
The price-scraping process typically involves two main steps:
- Attack the target:
- Scraper bots attack the target websites.
- Access pricing catalogs.
- Scrape data:
- Extract data in real-time or access historical pricing data.
- Create databases and keep them updated.
The risks and challenges of unallowed price monitoring
New online businesses are emerging daily, especially in the recent post-COVID years. The rivalry in the online marketplace is getting fierce, increasing the risk of price scraping.
The newbies on the market love this deceptive practice as it serves as an escalator to easier market penetration. But what elevates the success of one is a threat to the already-established players.
As an established player, your website becomes a prime target for price-scraping bots. They sneak in, crawling through every page to snag pricing info for each product. And trust me, they’re doing the same to your competition. Armed with this info, they craft killer pricing strategies – lower prices, bigger discounts, freebies – you name it, all to bring in more customers.
The result? Your loyal customers will start turning to the better deal. Suddenly, you’re dealing with abandoned carts, a revenue dip, and customer losses. Plus, the high volume of bot traffic slows down your website, causing a bad user experience that pushes customers away even more.
However, the risks of price scraping don’t end here – it can also trigger long-term consequences. This shady practice can disrupt your normal business operations and cause additional operating costs to mitigate and resolve the newly arisen situation.
And that’s not the end of the nightmare. Price scraping opens the door to unauthorized access, potentially leading to data breaches and compromising sensitive information. It’s not just your business at stake; it also puts the privacy and security of your loyal customers at risk as well.
You can learn some tips and tricks on how to mitigate bots on your website in this article.
Price scraping is a significant threat to online retailers. The more successful your online store is, the more likely it will be a target of competitors’ price-scraping attacks.
Various sectors are common targets for price scraping, often driven by the competitive nature of online business and the need for businesses to monitor their competitors. Some common sectors include:
E-commerce: This is the sector where price scraping is most commonly used among competitors. Online retailers use price scraping to monitor competitor prices and adjust their own accordingly. This can lead to price wars and benefit consumers in the short term but also put pressure on profit margins for businesses. As a result, it can lead to financial losses that might put some of the businesses at risk.
Travel and hospitality: Airlines, hotels, and travel booking websites constantly adjust prices based on factors like demand, seasonality, and competitor offerings. In the case of travel and hospitality, price scraping is used more in terms of allowing fair competition by comparing prices from different providers. We discuss more about the difference between this practice and unethical price scraping in the following paragraph.
Real estate: Property listing websites may be targeted for price scraping, where competitors try to gather information on property prices, rental rates, or other relevant data.
Technology and electronics: The prices of electronic goods and gadgets can be highly competitive, leading businesses to scrape data from competitors to set their prices lower.
Automotive: Price scraping can occur in the automotive industry, with businesses monitoring competitors’ prices for vehicles, parts, or mechanic services.
Retail and consumer goods: Beyond e-commerce, traditional retail businesses may also engage in price scraping to stay competitive in the market.
Healthcare and pharmaceuticals: This is also a highly competitive sector with a lot of different products, manufacturers, and online stores. That makes pricing information for pharmaceuticals, medical supplies, or healthcare services an easy target for scraping.
The two faces of price scraping: Fair competition or unfair advantage?
One of the doubts circulating about price scraping is why it is considered harmful if you use it for market research purposes. And it is a legitimate question.
While price scraping is considered harmful and raises ethical and logistical concerns, some forms of scraping might be regarded as acceptable, like for product aggregators or market research.
The difference lies in the intent and execution of price scraping. Monitoring services aggregate prices ethically.
They respect the robots.txt file that tells search engine (and other automated) crawlers which URLs they can access on your site. They also tend to avoid overloading websites with a lot of requests, and this all plays a crucial role in maintaining a healthy competitive ecosystem.
On the other side, scraping used for malicious purposes like predatory pricing or market manipulation distorts competition and harms all stakeholders.
Strategies to mitigate risks and prevent price scraping
Identifying and blocking scraping bots is a complex act. It requires a multifaceted approach, and balancing legal measures with technical solutions will help you stay protected from malicious competitors.
Legal measures against price scraping
However, even this process has some limitations. Unfortunately, it might not intimidate some violators since they know how to hide their identity.
Bot mitigation with CHEQ Essentials
Combating price scraping requires stronger measures. First, you’ll need to prevent those scraper bots from accessing your website.
But as scraper bots continue to advance in sophistication, their ability to mimic human interactions presents additional challenges in mitigating their presence. In the face of these relentless threats, implementing a robust bot management solution is imperative to increase your website’s defense against price scraping.
CHEQ Essentials is a leading bot detection and mitigation software that goes beyond conventional methods of bot protection. It analyzes user behavior to accurately identify scraping bots (and other malicious bots) in real time, blocking their access to your valuable data.
Ready to secure your pricing data and maintain your market share? Start your 7-day free trial to avoid price scraping.
Does price scraping affect consumers?
The impact of price scraping on consumers is multifaceted and depends on various factors, including how the scraped data is used. There are both positive and negative effects associated with price scraping.
On the positive side, consumers can benefit from comparison shopping and increased price transparency. On the negative side, dynamic pricing strategies and potential server strain on retailer websites may lead to higher prices during peak times and product unavailability.
Is price scraping legal?
In many cases, the act of scraping itself may not be explicitly illegal, but the way it is carried out or the use of the scraped data might raise legal concerns.
Legal issues can arise with price scraping when it violates a website’s terms of service or robots.txt, puts excessive strain on their servers, or extracts confidential or protected data like trade secrets. In such cases, the scraper could face accusations of breach of contract, unfair competition, or even data theft.
What’s the impact of price scraping on fair competition?
Price scraping can distort fair competition in a few ways.
Firstly, it gives some businesses an unfair advantage by revealing competitor prices instantly. This allows them to undercut or match prices with unrealistic speed.
Secondly, scraping can be used to manipulate prices artificially, like inflating competitor prices by flooding their sites with fake demand.
Ultimately, price scraping can allow bigger businesses to sell at lower prices and maintain profitability. Smaller businesses, on the other hand, can’t keep their profit margins if they try to follow these lower prices set by their competitors.