Connecticut has become the second state in the nation to enact legislation restricting the use of consumer data to establish customized retail prices, adding momentum to a growing debate over so-called “dynamic” or “surveillance” pricing in grocery and other retail sectors.
Gov. Ned Lamont signed the measure into law on June 5, prohibiting retailers from using personally identifiable information to determine individualized prices for consumers. The law follows similar legislation adopted last month in Maryland, which became the first state to restrict the practice.
The issue has drawn increasing attention as retailers invest in artificial intelligence, advanced analytics, electronic shelf labels, and other technologies capable of making pricing more responsive. Critics argue those same tools could eventually be used to charge different consumers different prices for identical products based on factors such as purchase history, location, online activity, or other personal information.
Supporters of the Connecticut legislation say the measure is intended to prevent that scenario before it becomes commonplace.
The debate intensified following reports that some retailers and technology providers had explored pricing experiments that resulted in consumers seeing different prices for similar items. While companies involved maintained those efforts were not based on sensitive personal characteristics, the reports sparked concern among consumer advocates and lawmakers.
Connecticut’s action comes as neighboring New York weighs a similar proposal. The New York Legislature recently approved a bill that would likewise prohibit retailers from using personally identifiable information to customize prices. The measure is now awaiting action by Gov. Kathy Hochul.
For supermarket operators, the practical impact may be limited in the near term.
Not Much Will Change Right Now
Most grocery retailers continue to rely on traditional promotional pricing, loyalty programs, digital coupons, and temporary price reductions rather than individualized pricing models. The Connecticut law does not prohibit those practices. Instead, it targets the use of personal consumer data to establish different prices for different shoppers.
Still, the legislation represents another sign that regulators are paying closer attention to how retailers collect and utilize customer data.
As supermarkets continue investing in personalization, AI tools, and digital commerce capabilities, lawmakers appear increasingly interested in establishing guardrails around how those technologies can be deployed. Connecticut and Maryland may prove to be early examples of a broader regulatory trend, particularly in the Northeast, where policymakers have shown growing interest in consumer privacy and data protection issues.
Here’s why it matters: Grocery retailers have spent years building loyalty programs and collecting customer data to better understand shopping behavior. Connecticut’s new law suggests lawmakers are drawing a distinction between using data to improve marketing and using it to determine what individual consumers pay. As AI-driven retail tools become more sophisticated, grocers may find themselves navigating an increasingly complex patchwork of state regulations governing pricing, personalization, and consumer trust.
