The New York State Attorney General has come out in favor of a bill that would ban electronic shelf labels, calling them an “exploitive practice” resulting in higher prices.
From The Gothamist:
“New York Attorney General Letitia James is throwing her support behind state legislation to curtail retailers and grocers from setting prices using algorithms based on personal data.
“James, a Democrat, held a news conference Monday at the state Capitol in Albany to push for a pair of bills that would effectively ban the practice, including one that would also prohibit grocery stores and pharmacies from using digital price tags that can instantly change prices in real time. She called it an expanding, exploitative practice that forces consumers to pay more.
“She said customers should pay the same price for the same items, regardless of their spending habits or personal backgrounds. But business and tech groups are pushing back, arguing the bills could threaten e-coupons and loyalty programs even though they contain language meant to protect them.”
According to the story, “These pricing tactics are happening online, where companies may rely on personal data to set prices, or in person, where digital displays can easily be adjusted in a way that critics fear could lead to surge pricing.
“James’ push with Democratic lawmakers comes less than a year after Gov. Kathy Hochul signed a bill into law requiring companies to disclose when they use personalized algorithmic pricing to set the price of any goods or services.”
James’ move comes at a time when a number of states are considering similar legislation, prompted at least in part by lobbying efforts by the United Food and commercial Workers (UFCW) union. Simultaneously, Walmart announced that electronic shelf labels, currently in about 2,300 of its locations, is expected to be chain-wide “within the next year.”
KC’s View:
Hate to fall back on a cliche, but while they’re at it, maybe these lawmakers also could try to revive the buggy whip industry.
Geez.
The logic behind this kind of legislation is flawed.
Using algorithms and technology to adjust pricing does not necessarily mean that prices will go up – as often as not, they will allow retailers to lower prices instantly when deals become available, circumstances change, or they see the opportunity to goose sales a bit.
These days, when there is so much pricing pressure on stores and continued inflation limits what people can spend on groceries, retailers will put themselves at a disadvantage if they were to raise prices willy nilly; and if one retailers uses ESLs to raise prices, a competitor can use ESLs to lower prices. It’s called capitalism. It’s called free markets. And if retailers abuse that power, they will pay the price in the form of consumer wrath.
Banning ESLs would be a profoundly stupid and regressive move that looks to drive the food industry back to the fifties.
I joked about buggy whips above, but this is all of a piece with other moves to do things like limit the number of self-checkout stations in stores. NBC News reported the other day on a public hearing held by Connecticut lawmakers “for a new bill that would limit self-checkout lanes and require certain staffing levels at grocery stores … The bill would limit the number of self-checkouts grocery stores are allowed to have to eight. There would also have to be at least one worker for every two self-checkouts monitoring the stations. And for every two self-checkouts, there must be at least one staffed checkout.”
These numbers might make sense. Or might not. But that’s up to the retailer to decide – based not just on costs, but on what they sense/know their consumers want, need and/or will accept.
Which is the way it ought to be.
These proposals are a crock. (I’d be worried about what lawmakers will try to ban or mandfate next. I am in favor of nuanced and appropriate regulation. But not this B.S.)
Retailers and their technology service providers have to fight back by telling their own stories. Vividly. Persistently. Consistently. They need to retake the narrative, explaining to consumers/voters/lawmakers why this technology is customer-centric. Use anecdotes and testimonials from shoppers expressing enthusiasm for these technologies.
Don’t depend on lobbyists trying to persuade (or bribe, via campaign contributions) lawmakers. Go right to their bosses.
Us.
The post Moves To Drive Food Industry Back To The Past Gain New Momentum appeared first on MNB.
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