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Will Consumer Data Collection Lead to Algorithm-Adjusted 'Surveillance Pricing'? (msn.com) 98

Posted by EditorDavid from the I'll-be-seeing-you dept.
An anonymous reader shared this report from the Washington Post's "Tech Brief": Last fall, reports that Kroger was considering bringing facial recognition technology into its stores sparked outcry from lawmakers and customers. They worried personalized data could be used to charge different prices for different customers based on their shopping habits, financial circumstances or appearance. Kroger, the country's largest supermarket chain, had already been using digital price tags in its stores.

Kroger told lawmakers that it doesn't use facial recognition to help it set prices, a stance the company reiterated to the Tech Brief on Thursday. Still, the uproar helped to spark a push by consumer advocates who warn that the threat of invasive, personalized pricing schemes is real. Now, Democratic lawmakers in several states are working to ban so-called "surveillance pricing" — when businesses charge customers more or less for the same item based on their personal information.
Besides a bill in California, three more bill were introduced this month in Colorado, Georgia, and Illinois that also ban "surveillance wages," which the article defines as employers adjusting wages based on how much data an employee collects. "Both surveillance pricing and surveillance wages really disrupt fundamental ideals of fairness," University of California, Irvine law professor Veena Dubal tells the Washington Post.

Dubal is one of the consumer advocates behind a new report which notes information released last month by America's consumer-protecting FTC that "suggests that surveillance pricing tools are being actively developed and marketed across a range of industries, including consumer-facing businesses like 'grocery stores, apparel retailers, health and beauty retailers, home goods and furnishing stores, convenience stores, building and hardware stores, and general merchandise retailers such as department or discount stores." The consumer advocates (which include the Electronic Privacy Information Center) put it this way.

"Imagine walking into a grocery store and seeing a price for milk that's higher than what the next shopper pays because an algorithm calculated that you're willing to spend more..."

Will Consumer Data Collection Lead to Algorithm-Adjusted 'Surveillance Pricing'? More | Reply

Will Consumer Data Collection Lead to Algorithm-Adjusted 'Surveillance Pricing'?

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  • Finally its benificial to dress like shit (Score:3)

    by Morromist ( 1207276 ) on Saturday February 22, 2025 @06:10PM (#65187847)

    I have a friend who says he always dresses poorly when making large consumer purchases from certain folks like car dealers because they'll lower prices for people who look poor. Why not extend this into all spheres of life?

    • Re: (Score:2, Funny)

      by Anonymous Coward

      Think it will help if I wear blackface?

    • Re:Finally its benificial to dress like shit (Score:5, Insightful)

      by alvinrod ( 889928 ) on Saturday February 22, 2025 @06:34PM (#65187889)
      I'm surprised they don't try to sell him shitty finance deals. Despite the idea that poor people don't have money, someone long ago realized that you can extract a lot more money from them if you're clever about it. The general concept has become associated with Pratchett's description of it in terms of strict purchases as related to boots [wikipedia.org]. I don't doubt that salesmen will also try to exploit the wealthy, but there are far fewer well-to-do than there are poor people and most of the upper crust don't ship at the same stores as everyone else. You may not make as much as someone focused solely on landing whales in any one sale, but you can surely make it up on volume.

      • Maybe they do try to sell him on shitty deals, I'm not sure. dressing poorly and then trying to buy a car with cash might make your dress fail to trick anyone, and getting bad loans is bad. On the other hand, buying a car is all about negotiation, or so they say, and you can and should get lones from other places than the dealership.

      • Re: (Score:2)

        by mjwx ( 966435 )

        I'm surprised they don't try to sell him shitty finance deals. Despite the idea that poor people don't have money, someone long ago realized that you can extract a lot more money from them if you're clever about it. The general concept has become associated with Pratchett's description of it in terms of strict purchases as related to boots [wikipedia.org]. I don't doubt that salesmen will also try to exploit the wealthy, but there are far fewer well-to-do than there are poor people and most of the upper crust don't ship at the same stores as everyone else. You may not make as much as someone focused solely on landing whales in any one sale, but you can surely make it up on volume.

        Yep, usually they try to scam anyone who looks poor because they're more likely to fall for it.

        There's a difference between not dressing up and dressing down. You can still be neat and presentable in jeans and a T-shirt. I know someone who used to work at an Aston Martin dealership, those who turned up in their Sunday Best were often not real customers, the real customers looked like normal people and wore comfortable clothing.

    • Or you have to VPN into an airline website or amazon from a poor country to see prices adjust

    • I have a friend who says he always dresses poorly when making large consumer purchases from certain folks like car dealers because they'll lower prices for people who look poor.

      Or they'll offer you a higher interest rate ...

    • Re: (Score:2)

      by sphealey ( 2855 )

      " purchases from certain folks like car dealers because they'll lower prices for people who look poor."

      Car dealers are notorious for figuring out ways to squeeze poor people for anywhere from 50% to 500% more than they charge people who obviously have the money and resources to fight back.

  • Doesn't make sense for brick and mortar (Score:4, Informative)

    by Tony Isaac ( 1301187 ) on Saturday February 22, 2025 @07:01PM (#65187929) Homepage

    Brick and mortar stores might have electronic price tags, but is the store's system really going to track you to the point that it knows what price it showed you, and remembers it when you arrive at the register? Amazon tried something like this with its cashierless stores, but backed off because the technology wasn't accurate enough without having actual humans watch you shop. There would be way too many issues with the system showing one price on the shelf, and charging you a different price at the register. Stores that use electronic price tags do use them to change prices from a central database, but they don't change the prices minute by minute, and certainly not shopper by shopper, but day by day.

    Online is a different story. Amazon already uses profiling to set prices, or at least to steer you to products listed at the price it thinks you'll pay.

    • Amazon tried something like this with its cashierless stores, but backed off because the technology wasn't accurate enough without having actual humans watch you shop.

      I'd say he technology wasn't mature enough yet.

      There would be way too many issues with the system showing one price on the shelf, and charging you a different price at the register.

      I've wondered about that too. But if their tracking is granular enough then they'll recognize you at checkout and charge "your" price. It will be interesting when people doing self-checkout next to each other compare prices and raise hell.

      But in those cases the store will then just charge the lower price to both. And there will be apps that allow people to compare prices in the store in real time - of course THOSE apps will probably charge a subscription fee, a

      • Hmmm maybe, but I think the whole scenario is far-fetched.

        A lot of this comes down to the reputation of a store. Only scumbag companies would try this kind of stuff. Established chains like Kroger and Walmart stake their reputations on selling things at a reasonable price. They're not going to suddenly start gouging specific customers because they have electronic price tags on the shelves.

    • Re: (Score:2)

      by EvilSS ( 557649 )
      Also how do you show two people two different prices at the same time? It's not like people go one at a time through a store. People would see prices changing and collectively figure out what was going on pretty fast. Then massive uproar.

      • No doubt.

        The only kinds of stores that would even try this sort of thing, are ones that don't care about their reputation. This is why you do business with stores you can trust.

    • Re: (Score:2)

      by tlhIngan ( 30335 )

      It doesn't make sense for a lot of circumstances.

      I mean, it's already pretty widespread knowledge when checking for plane tickets to try incognito mode to see if maybe you could get better rates.

      The problem with implementing dynamic pricing per-customer is just how much pricing information is out there.

      Doing it in a store is basically impossible - those tags cannot be updated quickly (what if multiple customers are gathered around for the same item - which price do you show?), and customers, if they get wis

  • Those who make more pay higher percentage of income in taxes, subsidizing those who make less. In case of surveillance pricing, those who are more affluent pay more for products, subsidizing the costs of store maintenance etc (if a lot of rich people shop there, stores will have better amenities, checkouts and such, even the poor who pay less can use them). So, if democrats are for progressive taxation, why are they against progressive pricing?

    • Yeah. It's funny how the usual suspects are all about "progressive" taxation, but will cry, bitch and moan about progressive pricing.

    • Re: (Score:2, Insightful)

      by ihavesaxwithcollies ( 10441708 )
      The dumbest fucking thing I've ever read. The profit to run any store is already baked into the price. Any surplus would be price gouging, aka excess profit. There is a reason why the 99 cent store still is open for business with such low prices.
      • Since when has price gouging been illegal (at least in the US)?
        • In most states, price gouging constitutes a violation of unfair or deceptive trade practices law.
          • Yeah, try proving it. I have never heard of anyone actually being prosecuted for this. The payday load businesses have been price gouging the poor for years and all you hear about preventing it is hot air.

            • , you mean this? [americanbar.org]

              , or this? [americanbar.org]. From that article;

              "between March and December 2020, the Florida Attorney General’s Office recovered $2 million in refunds and civil penalties for consumers as well as refunds for such things as event and trip cancellations and outright scams."

              Not never. Maybe not much, but not never. You just haven't heard.

            • How about you do that? You lazy ass. Just because you're too stupid to do a simple google search. The CFPB has regulated payday loans since its inception by Obama. Try googling that, genius.

      • Surplus profit?

        That's almost funny. Could you write an email to your boss listing the five accomplishments you had this week at work? Do you even know what your purpose is at work?

    • Only if they are middle class. The truly wealthy are able to hide their income from taxes and actually pay a lower overall rate than the poor. Warren Buffet pointed out that he paid a lower percentage of his income than his secretary. It gets even worse if you include capped taxes with Social Security.

      • Not really, the top 10% of wage earners still pay the lion's share of taxes in the United States.

        https://taxfoundation.org/data... [taxfoundation.org]

        It is interesting that the top 1% does pay less of their overall I come than the next 9% below them, but the top 1% is still paying just over 40% of all taxes. The next 9% below them are responsible for another 30% or so. The middle class isn 't really paying shit anymore.

        • From your linked page...

          The top 10% of wage earners in the US pull in just about 50% of all income earned in the US. So the fact that they pay 72% of the income taxes paid does not seem particularly problematic.

          The top 1% of wage earners in the US is pulling in just about 26% of all income earned in the US - so, again, them paying 40% of the income taxes paid is not problematic... unless you consider it too low of a percentage.

          The middle class is paying just about all of that other 28% - which makes it puzz

          • The top 10% could be pulling in 50, 70, or 90% of all income. They're still paying all the bills. What more do you really want? The point of taxation isn't to punish people for making money. It's to pay the bills. And they're doing it.

            Has it occurred to you that our progressive tax system has created a government of the rich, for the rich, and by the rich? When the bottom 90% contribute only ~30% of all tax revenue, it shouldn't surprise you when Washington insiders neglect the majority.

            • The rich also get the most from the government. Besides the obvious, they get protection from a French or Russian or Cuban style revolution. Being rich does not protect you from a mob made up of the other 99% of society, particularly when the army and police are part of that 99%.

    • Those who make more pay higher percentage of income in taxes, subsidizing those who make less. In case of surveillance pricing, those who are more affluent pay more for products, subsidizing the costs of store maintenance etc (if a lot of rich people shop there, stores will have better amenities, checkouts and such, even the poor who pay less can use them).

      I think that's probably true. But note that "rich" is a relative term. The rich people in the future you've painted will be the folks that we now refer to as lower-middle-class - that will be the hard upper boundary between the serfs and the parasite class.

      So, if democrats are for progressive taxation, why are they against progressive pricing?

      I think we liberals might be in favour of it - with a little bitching and dragging of our feet - if it was done fairly. But anyone who has been paying attention and not drinking the Kool-Aid knows that this is simply another means of making the rich drama

      • You're mostly right, with one exception - there's no way there could be anything fair about the practice, since it exploits both an information asymmetry (store collecting data about you) and a negotiation asymmetry (store changes offer but you can adhere or get out, there's no counter-proposal from you) to royally screw you over. All this is is rentseeking on crack.
      • I never used the term "rich", as it is completely ambiguous. Most people define it as "someone who has x% more than me", so billions of definitions in the world. Most people don't realize that they fit someone else's definition of rich. Heck, majority of Americans are rich compared to someone living in poverty in a 3rd world country. What I said was "more affluent people pay more", which means even if you don't consider yourself not rich, you still pay more than someone who has less than you.
    • There's multiple differences here - one is that progressive taxation is based on the idea that if you're rich, you're using the commons and the services society provides to a greater extent, thus you should contribute more. On the other hand, there's nothing such that Wal-mart or Kroger is providing for you, they're simply taking a bet that you'll not walk away in disgust at seeing the price they toss at you.
      Furthermore, you're overly optimistic in that financial dispositions are the only factor entering

      • I'm certainly not going to visit any store that has electronic price tags.

        So you never buy anything from the internet (by definition electronic pricing), or buy airplane tickets, concert tickets, etc?

      • There's multiple differences here - one is that progressive taxation is based on the idea that if you're rich, you're using the commons and the services society provides to a greater extent, thus you should contribute more.

        Obviously, even with a flat tax percentage, the more you earn, the more you contribute. You make 2x, you pay twice the tax. Progressive taxation say if you make twice, you must pay more than twice the tax. If you define "rich" as the level at which progressive tax rates kick-in, that makes every American who pays taxes rich (since below certain income level you pay 0% federal income tax).

  • ... to avoid unintended consequences like:

    No more discounts for students, military, senior citizens, etc. "because personal information."

    No more loyalty discounts "because personal information."

    No more competitive-trade-in discounts "because personal information."

    That won't be the intent, but someone somewhere is going to sue because they didn't get the discount someone else did because of "personal information."

    In other words, any law will need to carve out exceptions for discounts like the ones above.

    • discounts that any one get and based stuff that is the same for all May be fine.

      • Ok, so a discount based on how much you earn, discount on how well you dress, discount based on how much you want something. All these fit your criteria of "discounts that any one get and based stuff that is the same for all". All people who make under 40K get greatest discount, those who make more get a lower discount inversely proportional to their income. All fine by you because it's same for all? Want a bigger discount, make less money.

  • "Imagine walking into a grocery store and seeing a price for milk that's higher than what the next shopper pays because an algorithm calculated that you're willing to spend more..."

    Okay, you see a higher price on the digital price tag, but how does that track to the UPC/bar code during checkout? What if you alter your appearance before checking out, what price do you get charged, etc .. Unless they tracked you specifically and what you picked up, all over the store and not just using discrete FR shots, how do they implement this. Seems like it might require some computing effort in the back of the store. I get the theoretical concern, but am dubious about it in practice.

    • Given the stores have to know that there'll be a mass exodus of shoppers the moment they try to implement something like this... I am extremely dubious about it ever happening.

      It's not like it would be hard to spot this practice.

  • Someone makes the claim they were charged more because they are a minority, this will go up in a ball of flames.

    I am amused that the business class hasn't thought this through as to blowback.

    People like the concept of equal treatment in the marketplace. Give that up and it will get ugly in ways unseen since labor riots.

  • I'd phrase it another way to make it clearer to the business interests: "Imagine you run a grocery chain and you discover that your supplier is charging you a higher price than your competitors pay because he noticed your profits are higher and you can afford to pay more.".

  • The problem is inefficiency (Score:5, Insightful)

    by joe_frisch ( 1366229 ) on Sunday February 23, 2025 @02:13AM (#65188451)

    If prices depend on personal information the. At some point it will make sense to hire shoppers to shop for you. It will also make sense to change behavior to appear less able to pay, to do things like spending a lot of time looking ant prices but not buying.

    There will also be mistakes where the algorithm overestimates someoneâ(TM)s ability to pay and they can no longer afford to shop. The can try other stores, but again more wasted time

  • Dude, we're already there. And it's getting worse. So I switched to a de-Googled phone. It seems to work, along with the usual privacy setups.

  • >"Imagine walking into a grocery store and seeing a price for milk that's higher than what the next shopper pays because an algorithm calculated that you're willing to spend more..."

    Now imagine walking into a grocery store and seeing a price for milk that's lower than what the next shopper pays because an algorithm calculated that they're willing to spend more. Sounds pretty fair to me.

  • because another phrase for this is price gouging

  • ......then they are already doing this. There has been much discussion about the discrepancies at McDonald's between the app and in-person pricing. In all fairness some of those discrepancies were in the customer's favor (i.e. 2 for 1 deals that weren't offered in the stores) and some were not (higher prices on the app vs store).

    But it's here already and will only get more entrenched and more sophisticated as time goes on.

  • Now I'm imagining shopping where I have to haggle with an AI for the price of each shelf item before deciding to add it to my basket. Then there'd be second AI I hire to help me haggle with the store AI, and consumer magazine comparing price savings to subscription fees for haggle helper AIs, and scandals where the haggle helping AI and the store AI are actually the same entity.

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