“A Rigged System”: Lawmakers Renew Battle Against Digital-Only Discounts

One lawmaker says it’s about helping the marginalized and disaffected. Another lawmaker calls it a fight against “a rigged system.”

They’re both talking about the latest efforts to regulate digital-only grocery discounts in order to make them more accessible to the digitally-disconnected.

At the start of most states’ legislative sessions in January, New Jersey, Illinois and Connecticut were each considering bills that would require grocery stores to offer alternatives to requiring shoppers to clip digital coupons and discounts, such as offering paper coupon equivalents or just applying them automatically.

Since then, New York has revived a similar bill that failed to pass during its last legislative session. Rhode Island has become the latest state to join the fray with its own proposal. And San Diego has become the first city to consider regulating the issue at the local level.

Democratic State Representative Tom Noret of Rhode Island first proposed legislation last year that would require grocery stores offering digital coupons “to also make available to a consumer a paper coupon of identical value.” He’s now reintroduced a revised bill that would allow for other “alternative methods,” which “may include, but are not limited to, paper coupons, electronic kiosks, or application of the discounted price or benefit at the point-of-sale upon the request of the consumer.”

One in five Rhode Island residents are seniors, Noret told Coupons in the News. And they “may not be as technically savvy as their younger friends, families and neighbors.” While grocery shopping, he said, “I have seen older people or those who aren’t digitally connected faced with paying higher prices at the register then I have had to pay. The inequity of two people purchasing the same product at the same time but paying different prices because one doesn’t have a cell phone absolutely does not make sense and does not seem fair. We can do better!”

The good news for these shoppers is that the state’s major grocers are already complying with what the bill proposes. Rhode Island’s largest grocery chain, Stop & Shop, recently introduced in-store coupon kiosks where shoppers can load digital deals to their account without the need for their own devices. There’s also Shaw’s, whose owner Albertsons says many of its stores allow shoppers to get digital-only deals advertised in the weekly circular upon request. And the independently-owned Rhode Island-based chain Dave’s Fresh Marketplace doesn’t offer digital coupons at all.

Those types of solutions might be welcome in San Diego, where members of a city council committee last week unanimously endorsed a proposed ordinance that would mandate “paper or physical coupons in the identical value” to any digital grocery discount.

As a city seeking to pass an unprecedented mandate that has only been considered on the state level so far, “we actually have an opportunity here to be national leaders in protecting consumers, and I think that’s exciting,” the measure’s sponsor Sean Elo-Rivera said.

The proposal would require all grocery stores doing business in the city to post a sign at each checkout register, notifying shoppers of their “right to equal discounts.” Under San Diego law, the signs would state, “all digital discounts must also be available as printed coupons or clearly readable marked prices.”

“We’ve got folks that are struggling with the cost of living, they’re struggling to afford basics, and you shouldn’t have to jump through digital hoops to get the price that you’re expecting,” Elo-Rivera said.

More than a dozen city residents spoke in favor of the proposal at last week’s public hearing. “I consider myself to be digitally literate,” one said. “For people that are not as literate, with cell phones and the internet,” accessing digital-only grocery discounts is “extremely overwhelming.” Another spoke about her elderly mother. “To ask her to download an app, and then perhaps scan a QR code, and then click another button in the store to get access to a fair price on an item is basically an insurmountable task,” she said. Many seniors in the city “don’t have access to the internet, don’t have smartphones, and have real challenges navigating the digital world,” another citizen said.

“What I think this is, is a rigged system,” Elo-Rivera said. “It’s forcing people to navigate confusing apps, and hidden steps, just to get the prices that they were promised. And if you don’t have a smartphone, too bad. If you don’t speak English fluently, too bad. If you aren’t tech-savvy, too bad, you’re left paying more.” While one resident said the issue was about “equity and inclusivity,” Elo-Rivera said it was about “corporate greed. Big grocery chains have found another way to maximize profits. They’re using technology to exclude those who can least afford it.”

Grocery and retail industry representatives have spoken in opposition to other states’ initiatives, which has contributed to preventing them from moving past the discussion stage to become law. Connecticut’s proposal went dormant last month after opponents pointed out that regulating digital coupons could end up doing more harm than good. Despite lawmakers’ best intentions, “this bill ultimately will really help nobody,” Connecticut State Representative Tony Scott told the committee considering the measure.

He should know, he said, because when he’s not serving in the State Capitol, Scott is a Senior Promotions Manager at Edgewell Personal Care, owner of brands like Schick, Playtex and Hawaiian Tropic. “I manage a $40 million budget every year focused on coupons… and would put my coupon knowledge up against anyone else in the state of Connecticut,” he said.

Brands budget for a certain number of coupon redemptions by shoppers who make the effort to clip and use them, he explained. Applying all coupons automatically, or handing out paper coupons to anyone who asks, would cause redemptions to skyrocket to the point that brands could no longer afford to offer coupons at all. “We would not ultimately see a smoother and more inclusive couponing process at grocery stores. We would see a significant reduction of coupons from manufacturers,” he warned. So he urged his fellow lawmakers “to reassess this bill and discuss with industry leaders to understand in more detail the drastic ramifications if a bill like this were to pass.”

Some supporters of the idea aren’t dissuaded, though. Rhode Island’s proposal is moving forward. The measure in Illinois is scheduled for debate at a public hearing this week. The bills in New York and New Jersey are still under active consideration. And San Diego’s measure is due to be discussed by the full city council in the coming weeks, after which a simple up-or-down vote could determine whether it becomes law. “I think this is an opportunity for San Diego to protect our residents, refuse to play the rigged game that is being set up,” Elo-Rivera said.

So as decision-makers debate the best way to address “digital discrimination,” San Diego shoppers could be the very first to find out whether making grocery coupons more accessible will mean greater savings for seniors, as proponents promise – or, as opponents fear, fewer savings for everyone.

Image source: Stop & Shop