“Stop it,” Kroger customers scream, fearing price spikes after store introduces new technology
KROGER customers are angry about allegations that the company may use so-called “surge pricing” measures in its stores.
The company is currently under investigation by two senators after it brought to market a technology that many fear could lead to price hikes during times of peak demand.
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Kroger has been gradually introducing electronic shelf labels (ESLs) for years.
This technology allows the company to easily change the prices of its goods, raising fears that the company could misuse it to gouge prices.
There is currently no evidence that Kroger is raising prices and the company strongly denies the allegations.
PRICE INCREASES?
Dynamic pricing is when a company adjusts its prices in real time to account for supply and demand. Ride-sharing services like Uber and Lyft are known to use dynamic pricing because their services rely heavily on driver availability.
With the introduction of ESLs in stores, some fear that Kroger may change prices quickly—perhaps even multiple times a day—to raise them when demand is high.
Because of these concerns, Senator Elizabeth Warren of Massachusetts and Senator Bob Casey of Pennsylvania have launched an investigation into the company’s use of ESLs. The two Democrats sent a letter to CEO Rodney McMullen raising a list of questions about the company’s practices.
They are concerned about the price tags as well as the company’s partnerships with technology and AI firms.
“The widespread introduction of digital price tags will apparently enable large grocery stores to squeeze consumers to increase their profits,” the letter said.
The couple also claimed that the chain actively uses price spikes, which the company denies.
The senators have asked McMullen to respond by August 20.
“Kroger’s business model is to lower prices over time so more customers shop with us, which leads to more revenue, which we then invest in lower prices, higher wages and an even better shopping experience,” a spokesperson told Fox Business.
“Any test of electronic shelf labels is aimed at reducing prices for customers where it matters most,” they continued. “To say otherwise is untrue.”
The US Sun has contacted Kroger for further clarification.
CUSTOMERS REACT
The suggestion that Kroger could raise prices has sparked a fierce reaction from online shoppers.
One called on Vice President Kamala Harris to oppose this concept during her campaign.
“They need to make sure they stop these ‘price spikes’ that Kroger and others are trying to introduce with their new digital signs,” he said on X.
Others expressed concern about the company’s partnership with Microsoft and the potential use of personal data to set prices for individuals.
“Every aspect of this is evil,” said one X user.
“Don’t trust Kroger!!,” said another.
The debate over price gouging has become increasingly heated and political since Harris’ campaign team began blaming corporations for inflation.
Warren is fighting against a planned merger between Kroger and Albertsons.
The widespread introduction of digital price labels will apparently enable large grocery stores to squeeze consumers to increase their profits.”
Senator Elizabeth Warren and Senator Bob Casey
ANGERANGER
Kroger isn’t the only company facing backlash over potential price increases.
The recent introduction of ESLs at Walmart raised similar concerns.
Fast-food chain Wendy’s faced immediate negative reactions from customers after a senior executive made insinuations about dynamic pricing.
The company soon retracted its statements.
Even Lyft’s CEO has admitted that people don’t like price spikes – and he plans to dissuade the company from doing so.
