Walmart is accelerating the deployment of electronic price tags across its 4,600 U.S. stores, a move that has ignited concerns among Democratic politicians and labor unions regarding the potential for surveillance pricing and job losses.
The company aims to have the digital displays installed in all stores by the end of the year, a transition that also frees employees from the traditional task of manually changing paper price tags. However, this shift has drawn scrutiny, with critics fearing the technology could be used for price gouging.
Ademola Oyefeso, vice president of the United Food and Commercial Workers International Union (UFCW), indicated that the union is advocating for legislation to regulate the emerging technology. A primary concern is the Bluetooth capability of some electronic shelf labels, which can detect nearby devices, raising questions about potential misuse for surveillance if not properly regulated.
Walmart disputes these allegations. Company spokesperson Robyn Babbitt stated that the proposed legislation is an overreaction and that the digital shelf labels are "not a tool for surveillance pricing and are simply a modern way to display prices." She added that the labels "change how we display prices, not how we determine them," emphasizing that pricing decisions remain human-led and follow established internal processes.
Concerns about dynamic pricing and data collection have been amplified by previous incidents. Last year, Instacart faced backlash over varying markups for customers shopping at the same store. More recently, a Consumer Reports investigation revealed that ride-hailing services Uber and Lyft often charged different prices for identical trips. Additionally, Wendy's CEO retreated from plans to implement dynamic pricing on digital menu boards after significant customer backlash.
These uncertainties have prompted legislative action. Union officials have labeled the regulation of digital tags as a top priority, citing potential job elimination and the risk of consumers being charged different prices without their knowledge. Both the U.S. House and Senate have introduced bills targeting digital shelf tags, and seven states have proposed similar measures, spurred by union advocacy.
"Electronic shelf tags are a conduit for dynamic and surveillance pricing, which is why the bigger corporations are investing millions in hardware and software that allows them to instantaneously change pricing, multiple times a day," said Deborah Wright, political director of the Retail, Wholesale, & Department Store Union, at a New York City Council hearing.
At the same hearing, City Council member Carmen De La Rosa expressed apprehension, stating, "We have significant concerns around the ability to change prices rapidly and the ability for them to combine biometric data with the tags. Are [tag makers] collecting data?"
The technology behind many of these digital tags is supplied by Vusion, a French company that is reportedly the world's largest manufacturer of electronic shelf labels. Vusion representatives have attended legislative hearings to defend their products, asserting they enhance store operations and customer convenience while disputing claims of surveillance capabilities.
"We are actively defending ourselves. It's a real threat," said Christina Rodrigues, Vusion's vice president of marketing. The company acknowledges that its tags can flash a light to signal restocking needs or assist employees in locating items for online orders. Vusion executive Roy Horgan suggested that the blinking light could eventually connect with a customer's phone to help them find products and access more information, but pushed back against the notion that the technology facilitates dynamic pricing. "We don't know how retail shelf tags have gotten drawn into this debate about dynamic pricing," Horgan stated. "The reality is that they have been around forever."
Walmart maintains that the primary purpose of the digital labels is to ensure accurate pricing across all stores. However, union officials remain concerned that the technology could evolve to utilize biometric or facial recognition data to implement personalized pricing strategies based on shopper history and other factors.