Experts warn grocery stores could use personal data for 'surveillance pricing'

MONTREAL — Food policy experts are warning that grocery stores could one day use personal customer data to charge individuals different prices, a practice known as surveillance pricing.

Charlebois says there is currently no evidence that Canadian grocery stores are using surveillance pricing.

Major grocery chains Loblaw, Sobeys and Metro told CityNews they have no plans to use surveillance pricing.

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The concept is different from dynamic pricing, where prices fluctuate based on factors such as demand and availability, a model long used by industries including airlines and hotels.

In grocery stores, electronic shelf labels are making it easier to change prices more efficiently, but the labels themselves do not mean shoppers are being charged personalized prices.

Charlebois says the grocery industry's tight margins could provide an incentive to find new ways of increasing revenue, but warns about the potential ethical implications.

"You are looking at an industry with very thin margins, so any way to increase margins would be welcome. But sometimes ethical lines are crossed, and we saw that with bread a few years ago," he said.

He says with artificial intelligence playing a growing role in the industry, surveillance pricing is something consumers and governments should keep an eye on.

"What worries me is that the ethical line could be crossed," he said.

The idea is getting mixed reactions from Montrealers.

"I work in the tech industry, so I do know that they probably have a lot of information on us," one Montrealer told CityNews.

Another Montrealer said, "I’d say I’m okay with it. If a grocery store knows where I live, that’s fine with me."

One Montrealer said she could see advantages to stores using customer information to tailor the products they carry, but would draw the line at broader uses of her personal information.

"I’m Indian. I eat a lot of Indian stuff. So if my nearest [grocery store] has Indian products, that will make me happy," she said. "But them knowing my information other than that is not what I want."

Electronic shelf labels are making it easier for grocery stores to change prices.

Experts say a bigger concern is whether retailers could eventually use personal data to determine how much individual customers pay.

With files from CityNews