WASHINGTON (TNND) — Kroger and Walmart, among other retailers, are beginning to test out digital price tags. But shoppers and lawmakers are worried the change could lead to surge pricing.
Both marketing experts Anthony Salerno and Julio Sevilla tell us that dynamic pricing isn’t anything new. Both airlines and hotels use it but people view groceries differently.
People cannot not buy food and it also tends to be one of the largest line items in a households budget,” Salerno said.
“You’re ok with that for airline pricing because you know there’s demand but people have different expectations for the supermarket,” Sevilla added.
Over the next few years, several retailers like Kroger and Walmart announced they would begin using digital price tags. A move Salerno says allows companies to change prices quickly.
“To feel like you’re not able to know exactly how much a grocery bill will cost, could cause a lot of financial anxiety for households,” said Salerno.
Both Kroger and Walmart deny the claims that they’re using these tags to introduce surge pricing. Saying instead, this technology could be a major labor and money saver. Something Saloni Firasta Vastani, also a marketing expert says, at least right now, checks out.
“They have used it more to put more items at a discount for one reason or another. Whether it’s an expiration date or they have a lot in stock,” Firasta Vastani said.
But she believes there are three aspects to a move like this. A business, legal, and ethical aspect, and if you overstep on the last one, there could be repercussions.
“If customers start viewing a company as unfair, they are not going to shop there,” said Firasta Vastani.
Lawmakers are also concerned this new technology will lead to dynamic pricing. Senators Elizabeth Warren (D-MA) and Bob Casey (D-PA), among others, sent letters to the CEO of Kroger asking how the price tags would be used.
