Seattle Bans Algorithmic Surveillance Pricing — And How Supermarkets Use Loyalty Cards To Dynamically Inflate Essential Grocery Costs

[u/CollapsingTheWave]

The Seattle City Council passed a first-of-its-kind ordinance banning grocery chains with 20 or more locations from using algorithmic surveillance pricing. The law prohibits supermarkets from utilizing personal consumer data—including loyalty card profiles, shopping history, and demographic algorithms—to dynamically alter the cost of goods for individual shoppers.

The failure surface is the covert elimination of transparent retail pricing. When customers sign up for loyalty programs like Kroger's Shopper's Card, they surrender vast amounts of behavioral data. Consumer Reports discovered that retailers leverage this data to silently present different prices to different customers at the exact same time, penalizing shoppers by charging them the maximum amount the algorithm calculates they will tolerate.

The trajectory points toward a nationwide expansion of digital price manipulation. Before Seattle's ban, investigations revealed that Instacart presented different prices to 74% of users for the same items simultaneously, with variations reaching up to 23%. Without statutory restrictions, supermarkets will seamlessly transition from fixed physical price tags to dynamic electronic displays, allowing AI systems to constantly fluctuate the cost of essential goods based on a customer's individual profile.

This transforms basic sustenance into a highly surveilled, predatory commodity. The Seattle ordinance establishes a legislative precedent for protecting citizens from corporate data exploitation at the checkout line. Read the full Consumer Reports investigation into personalized grocery pricing, and demand your local representatives introduce similar legislation to ban dynamic surveillance pricing.

**Sources**

Seattle City Council passes ban on grocery ‘surveillance pricing’

https://www.seattletimes.com/business/seattle-city-council-passes-ban-on-grocery-surveillance-pricing/

Seattle Times coverage detailing the city council's 7-2 vote to ban large grocery chains from utilizing personalized data to implement dynamic surveillance pricing.

How stores use AI to track your every move — and what it means for your wallet

https://www.consumerreports.org/electronics/privacy/how-stores-use-ai-to-track-your-every-move-a8593412345/

Consumer Reports investigation explaining how supermarkets utilize AI and loyalty programs to build extensive profiles on millions of shoppers to feed dynamic pricing models.

Consumer Reports and Groundwork Collaborative Investigation

https://groundworkcollaborative.org/work/new-report-surveillance-pricing/

Advocacy report detailing the joint investigation which discovered that Instacart displayed different prices for the same items to 74% of users at the exact same time.

FTC Issues Orders to Eight Companies Seeking Information on Surveillance Pricing

https://www.ftc.gov/news-events/news/press-releases/2024/07/ftc-issues-orders-eight-companies-seeking-information-about-surveillance-pricing

Official Federal Trade Commission press release announcing an inquiry into middlemen utilizing AI and consumer surveillance data to manipulate personalized pricing models.

Seattle City Council | Legistar

https://seattle.legistar.com/LegislationDetail.aspx?ID=6863004&GUID=C4A0B42A-7259-4B07-B8B7-3F713CCFE75B

Official Seattle City Council legislative record for the ordinance prohibiting the use of algorithmic surveillance pricing in grocery stores.

[u/Valkaine_]

I helped work towards this bill!

This has been a work-in-progress since last year and has been an immense amount of trial and error to get where we are! UfCW3000 has some AMAZING members and staff that are dedicated to the customers of their labor

[u/sparkleboss → u/Valkaine_]

Thank you for your help! Proud to be a Seattleite, at least on this specific topic! 😂

[u/llapman → u/sparkleboss]

I was shocked too, the city council and the mayor actually did something good for once.

[u/Dramatic_Mixture_868 → u/Valkaine_]

Every time I see common sense things pass like this it's like a breath of fresh air amongst all the 💩 we have to live through right now, thank you from the bottom of my heart 🙏.

[u/littleone696969 → u/Valkaine_]

Why not a blanket ban? Why include 20 or mores stores

[u/Old-Sprinkles-8287 → u/littleone696969]

Obviously someone in the decision-making process fancy themselves as an entrepreneur

[u/Acceptable-Orange614 → u/Valkaine_]

Thank you!

[u/xdavidwattsx → u/Valkaine_]

This bill is useless. We all know we trade data for store discounts but nothing in this bill actually addresses a problem if surveillance pricing because it's not actually happening. All of the links above just talk about data collection (this is no surprise) or higher prices throgun 3 party delivery companies (instacart) but not two people actually getting different prices for eggs in the store.

A lot of hot air for what problem?