Hi, Yves. I was surprised the Senator didn’t mention that price gouging is a violation of retailer licenses in many jurisdictions (probably because this article omitted Warren’s comments on the issue). The license requires prices to be displayed and that retailers must honor the posted price. So if a higher number appears on the register scan, the retailer is obligated to honor the price near the item on the shelf. Stores may try to solve this problem by removing the posted item price, but retail laws generally require these prices to be posted, so this is another violation.
So why don’t customers protest? A simple method that was tried effectively in France was for customers to fill their shopping carts with goods and leave them in the store. In the French case, the stores quickly gave in.
I know some readers are skeptical of Warren, but this is one area where she can use her influence effectively.
By Julia Conley, Common Dreams staff writer. A common dream
Questioning whether the Kroger grocery chain’s new artificial intelligence-driven “dynamic pricing” model is truly intended to “improve the customer experience,” the senators said: Elizabeth Warren He said Friday that the actions show “corporate greed getting out of control.”
Sen. Warren (D-Mass.) spoke on Wednesday alongside Sen. Bob Casey (D-Pennsylvania). Write a letter Rodney McMullen, chairman and CEO of The Kroger Co. Expressing Concerns Kroger warned that its partnership with AI company Intelligence Node could lead to both privacy violations and exacerbate inequality by forcing customers to pay more based on the personal data Kroger collects to “determine how much price increases they are willing to accept.”
As the senators noted, the chain first rolled out dynamic pricing in 2018 and expanded it to 500 of its roughly 3,000 stores last year. The company is partnering with Microsoft to develop an electronic shelf label (ESL) system called Enhanced Display for Grocery Environment (EDGE), which uses digital tags to display prices in-store and allows employees to change them throughout the day with the click of a button.
As Warren said on social media on Friday, digital price tags would allow stores to “put special prices on water or ice cream when it’s hot” or raise the price of turkey just before Thanksgiving.
Grocery chains @Kroger They’re trying to trick us with digital price tags, a move that could allow them to apply surge prices to water and ice cream when it’s hot.
Corporate greed is out of control. Senbob Casey & I’m saying enough is enough.https://t.co/odfMW1UzR0
— Elizabeth Warren (@SenWarren) August 9, 2024
Through Intelligence Node and its work with Microsoft, Kroger is looking to tailor product prices to individual shoppers, as well as change prices based on time of day and other environmental factors.
The senators explained:
EDGE Shelf helps Kroger collect and leverage sensitive consumer data. In partnership with Microsoft, Kroger will install cameras on its digital displays and use facial recognition tools to determine the gender and age of customers captured on camera to present personalized offers and ads on EDGE Shelf. EDGE will enable Kroger to use customer data to create a personalized profile of each customer and display a customer’s maximum willingness to pay on digital price tags, a feature that the company sees as a profitable operation that simply isn’t possible with paper price tags.
“We are concerned about whether Kroger and Microsoft are adequately protecting consumer data and that as Kroger expands its personalized customer experience, customers may ultimately be offered bad deals,” Warren and Casey wrote.
The lawmakers noted that high grocery prices are a major concern for American workers and families, and that chain stores employ a variety of tactics to inflate prices from customers. “Shrinkflation” and “Greedflation”—High inflation during the COVID-19 pandemic has led them to pack fewer products into packages and keep prices high, even though supply chain issues have been largely resolved.
Kroger could soon be adding thousands of new stores. Potential $24.6 billion acquisition Albertsons had an operating budget of $3.1 billion last year and has had gross profit margins of more than 20% for the past five years.
Meanwhile, U.S. households spent an average of 11.2% of their budget on food in 2023, Warren and Casey said.
“The increased use of dynamic pricing increases corporate profits and passes the cost on to consumers,” the senators wrote. “It is outrageous that grocery giants like Kroger continue to engage in price gouging and other corporate profit-seeking tactics while families continue to struggle to pay for food.”
Messrs. Warren and Casey requested information from McMullen about his use of the ESL Platform, including EDGE, asking questions about how the company uses dynamic pricing to set prices and whether it has ever used EDGE to change the price of an item multiple times a day.
The senators Previous The bill was submitted prevent Concerned about shrinkflation, the senator has urged the Biden administration to use executive power to lower food prices and has proposed legislation to ban price gouging by giving state governments and the Federal Trade Commission the power to enforce federal bans.
