Sunday, July 21, 2024

FTC study finds ‘dark patterns’ used by most subscription apps and websites

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The U.S. Federal Trade Commission, along with two other international consumer protection networks, on Thursday announced the results of a study into the use of “dark patterns” — or manipulative design techniques — that can put users’ privacy at risk or push them to buy products or services or take other actions they otherwise would not have taken. In an analysis of 642 websites and apps offering subscription services, the study found that the majority — nearly 76% — used at least one dark pattern and nearly 67% used more than one.

Dark patterns refer to a variety of design techniques that can subtly encourage users to take some kind of action or put their privacy at risk. They are particularly popular among subscription websites and apps and have been an area of ​​focus for the FTC in previous years. For example, the FTC sued dating app giant Match for fraudulent practices, which included making it difficult to cancel a subscription by using dark patterns.

The release of the new report could signal that the FTC plans to pay closer attention to this type of consumer fraud. The report also comes as the U.S. Justice Department is suing Apple over its alleged monopoly on the App Store, a market that generates billions in revenue and sales of digital goods and services, including those delivered through subscription apps.

The new report released Thursday delves into the many types of dark patterns such as stealth, obstruction, complaints, forced action, social proof and others.

Sneaking was one of the most common dark patterns found in the study, referring to the inability to turn off automatic renewal of subscriptions during the sign-up and purchase process. Eighty-one percent of the sites and apps studied used this technique to ensure their subscriptions were automatically renewed. In 70% of cases, subscription providers did not provide information on how to cancel a subscription, and 67% did not provide the date by which the consumer had to cancel in order to not be charged again.

Obstruction is another common issue found in subscription apps; it makes it more difficult or tedious to perform a certain action, such as canceling a subscription or skipping the free trial sign-up, where the “X” to close the offer is grayed out and somewhat hidden from view.

Nagging involves repeatedly asking the consumer to perform some sort of action that the company wants them to do. (Although not a subscription app, one example of nagging is how TikTok often repeatedly asks users to upload their contacts to the app, even after the user has said no.)

Forced action means requiring the consumer to take some kind of step to access a specific functionality, such as filling out their payment details to participate in a free trial, something that 66.4% of the websites and apps in the study had required.

Meanwhile, social proof uses the power of the crowd to influence a consumer, usually to make a purchase, by showing metrics related to some type of activity. This is particularly popular in the e-commerce industry, where a business will show how many other people are browsing the same product or adding it to their cart. For subscription apps, social proof can be used to drive users to sign up for the subscription by showing how many others are doing the same.

The study found that 21.5% of the websites and apps they examined had used notifications and other forms of social proof to drive consumers to sign up for a subscription.

Sites can also try to instill a sense of urgency to get consumers to buy. This is something regularly seen on Amazon and other e-commerce sites, where people are alerted to low stock, prompting them to check out quickly, but it can be used less frequently to sell subscriptions.

Interface interference is a broad category that refers to ways in which the app or website is designed to pressure the consumer into making a decision favorable to a business. This could include things like preselecting items, such as longer or more expensive subscriptions (as 22.5% of those studied did) or using a “fake hierarchy” to visually present more business-favorable options more prominently. The latter was used by 38.3% of the companies in the study.

Interface interference could also involve something the study called “confirmation shaming” — using language to evoke an emotion to manipulate a consumer’s decision-making process, such as “I don’t want to miss out, sign me up!”

The study was conducted from January 29 to February 2 as part of the International Consumer Protection and Enforcement Network (ICPEN) annual review and included 642 websites and apps offering subscriptions. The FTC will take over as chair of ICPEN for the 2024-2025 period, it said. Officials from 27 authorities in 26 countries participated in the study, using descriptions of dark patterns set by the Organisation for Economic Co-operation and Development. However, the scope of their work was not to determine whether any of the practices were illegal in the affected countries; that is for individual governments to decide.

The FTC participated in the ICPEN review, which was also coordinated with the Global Privacy Enforcement Network, a network of more than 80 privacy enforcement authorities.

This isn’t the first time the FTC has examined the use of dark patterns. In 2022, it also wrote a report that detailed a variety of dark patterns, but wasn’t limited to just subscription websites and apps. The previous report instead looked at dark patterns across all industries, including e-commerce and children’s apps, as well as different types of dark patterns, such as those used in cookie consent banners and more.

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