Consumers are feeling less empowered than ever, we don’t have market power and we live in a constant state of asymmetric information.
Recently, Walmarts introduced electronic shelf labels where they can change the prices of items based on external factors like weather (hot day, higher priced ice cream) or use surge pricing based on availability of product.
Imagine you’re a frequent customer, and every Tuesday right after work, you get a cartoon of eggs, milk, Doritos, and carrots. Nothing more, nothing less. But how do you trust your grocery store to not change the price of items based on the personalized data that they have about you? If they know you come in at 3:30pm, how can you be sure they haven’t raised the price of carrots in the last 10 minutes because you walked into the store? And if you wanted to check how would consumers get access to the historical price of an item they’ve purchased? Are consumers entitled to that information and would knowing even help?
These retail stores could change pricing based on any number of factors such as: frequency of steps in an aisle, rate of opening freezer doors, using external data of food outbreaks and contamination cases. In many cases, these recalls are not known by the average consumer until they’ve been taken off the shelfs. Pricing can also be influenced based on the arrival of new versions of products, or real time shipment logistics.
Another instance is Radio City Music Hall's use of facial recognition which relies on biometric identifier information. They’ve used this to ban employees of a legal firm that was in litigation against the venue. This invasive identifier was then used to prevent an attorney from the firm from watching a Rockettes show with her daughter.
Similarly, cooler smart doors with digital displays that use “front-facing sensors...that detect customers' presence and interaction”, the sensors also track how long customers spend in front of the coolers, how often the door opens, and show targeted advertisements.
This will just be the beginning, as the advancement of invasive technology such as biometric data (like eye tracking sensor) is implemented or face recognition technology is integrated into retail.
It’s worth considering that there could be price manipulation and gouging on retail websites based on cookie analytics. A site might increase or market different products based on a user utilizing buy now, pay later options like Klarna or Afterpay. These algorithms could be subtly and potentially discriminatorily driving up costs for certain consumers without them realizing.
We live in a technology first world using hundreds of different apps that are developed by different companies, in different jurisdictions, with different expectations of privacy and data collection. Our health data, behavioral data, emotional data, and biometric data are being collected every second - potentially against us.
Many companies are racing to integrate so many novel and experimental technologies into their products for mass use believing these innovations will give them a competitive advantage. However, the risk, long term impact and future use, security vulnerabilities, and potential abuse of these experiments have not been thoroughly examined. Then it becomes a race to the bottom - if companies that exploit biometric data get revenue advantages in a tightening market, then the rest of the market will respond.
Technology companies do not operate in silos - they’re either building on top of each other's independent research, or leveraging open source software. Thereby, creating an interconnected web of development that accelerates trends.
It won't be laws or regulations that’s going to save us—it’s standardization at the infrastructure level. The core issue is user consent regarding all the data extracted from their activities and then how that data is used. Data minimization will be crucial: what information are companies collecting, and how much of it is actually necessary for product functionality? If an app is tracking my steps, why does it need my location? We should also consider usage limitations—questions of where restrictions should be applied: at the point of data collection or in how the data is used?
However, focusing solely on usage might be nothing more than a temporary fix. Is the solution to demand 100% transparency from companies about what they’re tracking? While transparency may sound ideal, it risks overwhelming consumers, leading to fatigue rather than empowerment. How do we strike a balance that benefits users?
It is deceptive for information to be buried in the terms and conditions - these documents are for the protections of the company, not to inform the user. Consumers do not have the market power to have other recourse and most of the time cannot individually opt out of certain data collection types - it's all or nothing.
How can we create a better way for consumers to understand and feel empowered by the apps they’re using that's directly relevant and useful for them?
In the next few years we’re going to see an uptick of niche hardware startups, AI tools integrated into everyday products, and AR/VR devices will continue to evolve. Given the acceleration of technology, developers and startups should be incentivized to prioritize the safety and choice of the user that are neither prohibitively expensive nor inaccessible. When startups that build highly invasive products get a lot of funding from venture funds, it creates behavior that accelerates the adoption and use of those invasive technologies and mechanisms.
As we navigate the future it begs the question of: How are we defining consent? Trust? Privacy? And from whose perspective? Consumer, Corporate, or Government?
While users should take responsibility for their own decisions, it can be difficult to move through a technology-first world when true consent and knowledge is obfuscated and invasive technology is eroding consumer power more each day.