Digital Shelf Labels Are About Accuracy — Not Surveillance
As New York lawmakers consider legislation (S.8616/A.9396), which would restrict digital shelf labels (DSLs) in grocery stores, it’s worth clarifying what this technology does — and what it does not.
Digital shelf labels are simply electronic versions of the paper price tags displayed beneath products on store shelves. Instead of requiring employees to print, sort and replace thousands of paper tags by hand, stores can update those labels electronically to ensure the price shown on the shelf matches the price charged at checkout.
That may sound like a small operational change, but it matters to shoppers. Price mismatches between shelf tags and registers remain a common source of frustration in retail. Electronic labels help reduce those errors by making price updates faster, more consistent, and easier to implement across an entire store.
They also matter to workers. In many grocery stores, employees spend significant time every week replacing paper tags aisle by aisle — time that could otherwise be spent stocking shelves, helping customers, or keeping products available. Digital labels reduce that repetitive manual work and allow staff to focus on more valuable tasks.
Yet, despite these practical benefits, digital shelf labels have recently drawn scrutiny amid concerns that they could enable “surveillance pricing” or rapid price changes that harm consumers.
Those concerns misunderstand the basic structure of in-store pricing.
Shelf prices in a grocery store are public and visible to everyone. Every shopper in the aisle sees the same posted price, just as regulators and store employees do. If a price changes, it changes for everyone. That is fundamentally different from hidden online algorithms or individualized digital advertising.
The broader fear that this technology will usher in widespread “surge pricing” in grocery stores is also unsupported by the evidence. Grocery retail operates on thin margins in a highly competitive environment, where even small differences in the price of everyday staples can influence where consumers shop. Research examining grocery stores that adopted digital shelf labels has found no evidence that the technology has led to surge pricing or price gouging.
In other words, the evidence does not support the idea that digital shelf labels are being used to quietly raise grocery prices.
Digital pricing displays are also far from new. Consumers see electronic price boards every day at gas stations and drive-through restaurants. These displays have been widely used for years because they improve clarity and reduce pricing errors. Bringing similar technology to grocery shelves simply modernizes an outdated system.
That doesn’t mean policymakers shouldn’t ask questions about how pricing technology evolves. Consumer protection laws should always keep pace with innovation. If businesses were to engage in deceptive or discriminatory pricing practices, regulators already have strong tools to investigate and address those problems.
But legislation based on hypothetical concerns rather than real-world evidence risks creating unintended consequences. Restricting digital shelf labels would not lower grocery prices or address the underlying drivers of inflation. It would simply force retailers and workers to rely on slower, more costly, and less accurate paper-based systems.
At a time when New Yorkers are already feeling the pressure of rising costs, the focus should be on solutions that improve efficiency, accuracy and transparency — not on banning tools that help stores display prices more reliably.
If lawmakers want to address personalized or algorithmic pricing, they should regulate those practices directly.
Banning a display that helps prevent pricing errors would miss the real issue — and make grocery pricing less accurate for the very consumers policymakers are trying to protect. Our legislators should take time to examine the evidence and understand how it works in practice.
Michael P. Durant, President/CEO of the Food Industry Alliance of NYS, Inc.
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