Your Zip Code, Your Grocery Bill: The Rise of Algorithmic Pricing in Supermarkets
From Paper Tags to Pixels: The Invisible Price Change Remember the days of the bustling grocery store on a Saturday morning, flyers in hand, and the predictable joy of finding your favorite items on sale? Those paper tags and weekly specials are becoming relics. Now, pricing isn’t just about cost and margin; it’s also a question of when and where. Enter algorithmic pricing , a quiet digital revolution happening right under our noses—on the very shelves of our local supermarkets. At its core, dynamic pricing in retail resembles how airlines price their seats. Based on a variety of factors, the cost of, say, a gallon of milk might change multiple times in a week—much like how a seat’s price fluctuates until the airplane takes off. But what makes this possible? The advent of technologies like Electronic Shelf Labels (ESLs) , artificial intelligence, and expansive data collection enables this new age of variable pricing. The complex algorithms behind ESLs can instantly update prices b...