Consumer complaints and lawmakers’ concerns have sent grocery stores scrambling recently to make their digital coupons available in paper form. And it turns out that may not be a uniquely American phenomenon.
Thousands of miles away from here, you’ll find one of the world’s most tech-savvy populations, in Norway. The rate of smartphone usage there far exceeds the 91% who the Pew Research Center estimates are smartphone users here in the U.S.
Nevertheless, concerns about a “digital divide” at the grocery store have now made their way to the Land of the Midnight Sun as well.
A new report commissioned by the Norwegian government examines that country’s grocery loyalty programs, and warns that they could disadvantage the digitally-disengaged, forcing some who can least afford it to pay higher prices for their food.
If that sounds familiar, it’s the same argument that has led one U.S. city to pass a law, and other cities and states to consider doing the same, forcing grocery stores to offer in-store alternatives to digital-only deals.
The Norwegian report, prepared by the Norwegian Institute for Consumer Research, doesn’t recommend that just yet. But it provides an exhaustive history of grocery loyalty programs in the country, and points out where they can do better.
And one of the ways they can do so, is to be structured in a way that does not exclude those who can’t, or choose not to, participate.
There are only three major grocery chains in Norway, controlling 97% of the market. And all three have loyalty programs similar to those in the U.S., offering access to sale prices, personalized deals and digital coupons. So shoppers have little choice but to shop at one of the big three chains, and little choice but to join one or all of the chains’ loyalty programs unless they want to be forced to pay more.
But this “raises important questions about accessibility for vulnerable groups,” the report notes. “Although the chains offer physical cards that provide access to some benefits, much of the real value in the loyalty programs is tied to app-based features.” That means shoppers “with low digital literacy, without a smartphone, with limited language skills, cognitive challenges or impaired vision” may be missing out on discounts that more tech-savvy shoppers can easily take advantage of.
It’s not just those who lack digital access who could be missing out, though. The report goes on to say that shoppers who value their privacy are disadvantaged as well. In some cases, loyalty discounts and digital coupon offers are prominently advertised. Personalized pricing is not. “This makes it impossible to assess the value of what you are actually getting – and what you may be missing out on – when deciding whether to let the chains analyze your data,” the report states. Shoppers “must therefore approve data-sharing on incomplete information,” which raises questions about whether “transparency is sufficient, even if the data collection itself is legal.”
So it’s not just a digital divide based on smartphone ownership, but a “class divide between those who can and want to be active and those who cannot,” the report warns.
The report does not make any explicit recommendations. But some government leaders who’ve read it appear interested in taking action. “It should be easy to see what an item actually costs and to compare prices between stores,” Norway’s Minister for Children and Families Lene Vågslid said in a statement. “We must strengthen consumer power and ensure that everyone has the opportunity to benefit from good offers and discounts.”
“The government is working on several different measures to improve competition in the grocery industry,” Minister of Trade and Industry Cecilie Myrseth added. “Good and clear price information for consumers is an important part of this.”
Proposals to address the digital divide in the U.S. have ranged from requiring stores to grant digital-only discounts upon request, to mandating paper versions of all digital coupons, to requiring that any digital discount be given to every customer automatically. Critics of such proposals argue that digital-only grocery deals are here to stay, and it’s not fair to retailers or the vast majority of their customers to accommodate those who can’t or won’t adapt.
Norway will have to decide for itself whether the few who lack smartphones deserve low prices, too – or whether leaving some behind as the rest of us march into a digital future is simply the price of progress.
Image source: NorgesGruppen
