(FamilyConservationPAC.com)—Despite the efforts of the Biden and Harris administrations to downplay and deny it, supermarket prices are rising, making it more difficult for Americans to afford food.
With no indication of slowing down, Americans have spent most of their income on food in the last three decades. The average consumer paid 25% more at the end of last year than four years prior for the same things at the grocery store.
The cost of groceries has increased by 1.1% on average by June of this year, and there is no indication that this trend will stop. Numerous causes exist, such as increased input price pressures, rising minimum wages, and growing transportation expenses.
Still, there’s one more thing to worry about that should frighten foodies everywhere: dynamic pricing.
Kroger's Shocking New Digital Price Tags Explained!#Kroger #DigitalPriceTags #AIInRetail #GroceryShopping #PriceGouging #ConsumerRights #FacialRecognition #TechInGrocery #RetailInnovation #KrogerMerger pic.twitter.com/CKS89LQgHL— CISO Marketplace (@CisoMarketplace) September 12, 2024
Senators Bob Casey (D-Pa.) and Elizabeth Warren (D-Mass.) expressed concerns about possible price gouging through electronic shelf labels in a recent letter to the CEO of Kroger, a grocery store chain.
They contend that supermarket companies such as Kroger inflate costs and take advantage of working people by using “Electronic Shelving Labels (ESLs).”
Businesses can use digital price tags to implement dynamic pricing, which modifies product prices in response to cyclical variables like the temperature or the time of day.
Stephen Kent, the communications director for Consumer Choice Center, disagrees, stating that Senator Elizabeth Warren has purposefully deceived the media over Kroger’s computerized price tags, which are present in several of its locations.
There is no proof that they have ever implemented dynamic pricing. However, theoretically, they could be utilized at the touch of a button. Surge pricing would also be standard in the grocery industry and the hospitality, entertainment, and transportation sectors in a free market.
ESL labels can be changed quickly compared to paper labels, which take a lengthy process. The largest grocery store company in America, Kroger, has used this technology at select locations since 2018 and has about 500 stores nationwide.
Walmart, on the other hand, has over 2,300 locations using it. Although surge pricing is nothing new for rideshare applications and online vacation reservations, applying it to everyday activities like shopping and needs is a fresh attack on customers whose wallets are already completely empty.
In contrast, Kent asserts that quick changes in response to supply and demand are not evil. Would a Kroger store not place a higher price on the watermelons it has on hand if a truck carrying the fruit flips over and loses that supply?
Buyers are hesitant to purchase anything if the price is more than they can afford.
However, the capacity to adjust pricing so quickly may present an even bigger risk when facial recognition technology is used to determine customers’ demographics and purchasing patterns.
Restaurants and supermarket businesses use this to watch customers’ every move and try to extract every last penny from them. This isn’t conjecture or hypothetical thinking.
Kroger and Walgreens have already been sued for unauthorized use of face recognition technology, and this trend is becoming widespread.
As AI is used to explain food chains, Corey Mintz says:
“McDonald’s has been testing out AI since 2019, using license plates to identify repeat customers (with consent) and customize ordering suggestions at the drive-thru.
More recently, Point Jupiter, a company that conducted a trial of face-recognition software within McDonald’s ordering kiosks, was able to scan users’ faces, recognizing their “gender, estimated age, and sentiment” in order to make meal recommendations.”
One aspect of the plan targets working people who are most hungry and close to a drive-thru. Another is tracking user purchasing patterns more precisely when they are supermarket shopping.
The Price Gouging Prevention Act and the Shrinkflation Prevention Act, sponsored by Senator Casey, would grant the Federal Trade Commission. State AGs would have the authority to enforce laws against this, prohibiting businesses and eateries from charging the same price for smaller food portions.
According to a 2023 UCLA analysis on ESLs, “time-based pricing creates value for the stores (through higher prices) [but] offers no benefit to consumers,” and “the increase in the retailers’ profits may not be able to offset the decrease in consumer welfare, and could reduce the social welfare below the status quo.”
However, Kent argues that the worries are exaggerated and politicized, asserting that “ESLs facilitate quick price reductions when corporate sales flow to individual stores, and they also make it easier for stores to rearrange and replenish shelves.”
While we all know that grocery stores frequently lower the prices of popular items, an inappropriate amount of attention is paid to higher prices.
Some jurisdictions, like Illinois, have enacted more stringent privacy rules concerning the unlawful use of facial recognition technology; nonetheless, surge pricing, which has the potential to transform into dynamic pricing rapidly, is still in effect.
Warren and Casey assert that “the EDGE Shelf helps Kroger gather and exploit sensitive consumer data in addition to price gouging.” “Kroger intends to install cameras at its digital displays as part of a partnership with Microsoft. These cameras will use facial recognition software to identify the age and gender of a customer who is photographed and show them tailored offers and advertisements.”
Kroger maintains that customers pay less, thanks to its ESL system. “Kroger’s business model is to lower prices over time so that more customers shop with us, which leads to more revenue that we then invest in lower prices, higher wages, and an even better shopping experience,” a Kroger spokesman said in a statement.
“Everything we do is designed to support this strategy,” stressed Kroger, adding, “and customers are shopping with us more than ever because we are fighting inflation and offering great value.”
They added, “The goal of every electronic shelf tag test is to give customers additional savings where it counts most. Anything to the contrary is untrue.”
Watch the video below to learn more about the topic from the “Blaze News Tonight” crew:
What are your thoughts on grocery stores using Electronic Shelving Labels (ESLs)?
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