Senators Elizabeth Warren and Bob Casey have sent a letter to Kroger CEO Rodney McMullen to request information about the company’s plans for use of electronic shelving labels.
Kroger, like many grocery store chains, have increasingly been using Electronic Shelving Labels (ESLs) to dynamically price products, changing the price based on a variety of factors.
ESLs are digital price tags that allow companies to engage in dynamic pricing, changing the prices of goods based on temporary factors such as the time of day or the weather. By updating price tags with the simple click of a button, corporations can price gouge, suddenly raising the consumer costs at times when certain products are in highest demand.
According to the lawmakers, Kroger has partnered with Microsoft to gather customer data in an effort to understand just how much they will tolerate price increases, and then give target them with personalized prices.
“The increased use of dynamic pricing will drive company profits higher – leaving consumers with the bill,” wrote the lawmakers.
“I am concerned about whether Kroger and Microsoft are adequately protecting consumers’ data, and that as Kroger expands the personalized customer experience, customers will ultimately be offered a worse deal,” continued the lawmakers.
“It is outrageous that, as families continue to struggle to pay to put food on the table, grocery giants like Kroger continue to roll out surge pricing and other corporate profiteering schemes,” concluded the lawmakers.
Hopefully, lawmakers will be able to curtail such activities, ensuring fair pricing for all customers.