The Maryland Retailers Alliance (MRA) is opposing legislation that would prohibit “surveillance pricing,” calling it based on misconceptions about how pricing actually works in grocery stores and retail more broadly.
Retailers do not set prices based on individual consumers’ personal data, identity or purchasing history, the trade association said Jan. 22. Grocery shelf prices are the same for every customer who walks through the door, regardless of who they are, where they live or what they have purchased in the past.
“Maryland should focus on policies grounded in facts, not fear, and the fact is that retail technology utilizing consumer data is used to lower prices, not increase them,” the Maryland Retailers Alliance said. “Legislation that bans practices retailers do not engage in risks unintended consequences while failing to address real consumer concerns.”
Dynamic Pricing Tools Help Manage Costs
Much of the confusion stems from a misunderstanding of dynamic or algorithmic pricing, which retailers use to manage inventory, respond to wholesale cost changes and remain competitive. This technology helps retailers adjust prices uniformly across all shoppers based on factors such as supplier costs, seasonality, promotions and market competition – not personal consumer data.
Recent academic research, including a University of California San Diego study examining the use of electronic shelf labels in grocery stores, found no evidence of surge pricing or individualized pricing as a result of these technologies. The study concluded that fears of grocery “surge pricing” are not supported by real-world data.
Grocery retailers operate on razor-thin margins, often between one and three percent. Restricting legitimate pricing tools would increase operational costs, reduce flexibility and ultimately harm consumers through higher prices, reduced promotions or fewer choices – particularly in communities already facing affordability challenges.
“We urge lawmakers to reject proposals that mischaracterize retail pricing practices and instead work collaboratively with businesses to protect consumers and maintain a competitive, affordable marketplace,” the Maryland Retailers Alliance said.
The Maryland Retailers Alliance is a statewide membership association representing retail businesses of all shapes and sizes throughout Maryland. As the retail community’s major trade association, MRA is a diverse and broad-based organization covering all segments of the retail industry.
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