We are thrilled to share that research from UCL School of Management Associate Professor Onesun Steve Yoo and Assistant Professor Dongyuan Zhan has been cited in a formal letter to Kroger CEO William McMullen from current US Senators Elizabeth Warren and Robert Casey, Jr. In recent years, US retail prices have sky-rocketed, with concerns raised about the business models powering large conglomerates and their subsequent impact on consumers.
Entitled ‘When should grocery stores adopt time-based pricing? Impact of competition and negative congestion externally’, Steve and Dongyuan’s paper explores supermarkets’ adoption of electronic shelf labels and the ways in which this can enable them to engage in surge pricing. The co-authors explore the possibility of grocery stores introducing higher prices during congested peak hours in order to manage demand and the subsequent impact on wider competition within the industry.
In their letter, Senators Warren and Casey raise concerns over Kroger’s use of electronic shelving labels and their likely impact of encouraging surge pricing and exploitation of consumers in times of economic uncertainty. As one of the largest general retailers within the US, the adoption of these ESLs could have significant ramifications for average Americans. Pointing to Steve and Dongyuan’s paper, Senators Warren and Casey highlight the notion that ‘the adoption of time-based pricing leads to differentiated price competition’, which can ultimately ‘soften price competition, causing both peak-hour and normal-hour prices to rise.’
