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Retail tech and how it's affecting you

What you need to know about emerging trends in retail technology. 

Last updated: 10 May 2023


Checked for accuracy by our qualified fact-checkers and verifiers. Find out more about fact-checking at CHOICE.

Need to know

  • Consumers are being tracked and recorded in retail spaces, often without their knowledge
  • Personalised pricing leaves consumers open to discrimination, both online and in physical stores  
  • Electronic shelf labels, AI and RFID technology will transform how we shop and pay at the checkout 

Shopping. Love it or hate it, it's something most of us have to do. And in the quest to capture our hearts, minds and wallets, retailers are turning more and more to 'retail tech' to help them understand what makes us tick. While most of us are at least somewhat aware that our online movements are tracked, the way technology is used to monitor us when we shop at bricks and mortar stores is something many are not aware of. 

Beacons, wayfinding, electronic pricing and streamlined checkout are a few of the retail tech trends that have already reached our shores or are coming soon.

A lot of retail tech relies on tracking people's phones, on data collection and analysis, and on AI-generated decisions

To better understand these technologies and how they can influence our behaviour, we spoke to Jana Bowden, professor of marketing and consumer behaviour, and chair of ethics, at Macquarie University; Billy Sung, professor of consumer psychology and neuroscience at Curtin University; and Suelette Dreyfus a senior lecturer at the University of Melbourne's School of Computing and Information Systems who does research in digital privacy and security.

We also look at what the trade-offs are for consumers as we enter an era of convenience and hyper-personalisation. A lot of retail tech relies on tracking people's phones, on data collection and analysis, and on AI-generated decisions about what we might like and what we should pay for it.

As always, there are winners and losers.

Tracking your movements 


Bluetooth beacons and Wi-Fi tracking in shopping centres can be used to track your movements.

The placement of beacons inside shops and shopping centres is now commonplace. Beacons are devices that emit Bluetooth signals, and they can be used to track your movements.

How does that work? Well, most of us leave Bluetooth enabled on our phones without even thinking about it. And that's all that's needed for your phone to find the beacon.

As Sung explains, you don't even need to have any specific app open. As long as Bluetooth is enabled, a smartphone sends out 'pings' in search of a Bluetooth network, and the beacon detects these. 

Once your phone has connected with the beacon, it can track the phone's movements (within a certain range) and may trigger a notification or in-app message, depending on the apps and settings on your phone. 

As long as Bluetooth is enabled, a smartphone sends out 'pings' in search of a Bluetooth network, and the beacon detects these

"Beacons give retailers a general sense of where people are moving within the store," says Sung. This information helps them make decisions on shop layout and merchandising.

Another method is Wi-Fi tracking. Phones with Wi-Fi enabled may be detected by a tracker device or Wi-Fi access point. "Most large shopping centres have that technology," says Sung. "They use it to assess traffic flows … and set the rent."

For Suelette Dreyfus these are just some of the ways we've become less anonymous as we shop. "They're able to track you through the Wi-Fi network … they will know what stores you go into, where you linger. Similarly, Bluetooth beacons … might be tracking you as well and could have access to other information including certain transactions you might have made. That could be correlated with your movements in the shopping mall and how long you spent at a particular store."

Wayfinding and proximity marketing

Beacon technology becomes more personal if you have the retailer's app on your phone. Now it might offer you use of the store map, and show you where to find the products you normally buy.

You might receive nudges about discounts and special offers, and maybe messages relating to the products you're standing next to. This is what's known as 'proximity marketing'.

Sung takes the example of moving through supermarket aisles with the store app enabled. A beacon detects when you're near the cereal aisle, and the store knows what your favourite cereal is, based on your purchasing history. So, you receive an alert on your phone that there's a discount today on that cereal, and the app indicates which shelf it's on.


If you have the retailer's app on your phone, it might send you personalised notifications based on your physical location.

"Big brands have had great success with beacon technology," says Bowden.

"More tailored promotions means more consumer engagement, which in turn fuels more sales.

"From a consumer psychology perspective, proximity and wayfinding marketing have the effect of making consumers feel that the brand has a social presence in their lives. It makes them feel valued, wanted, and rewarded.

"And receiving a discount on your phone at the moment of purchase is a psychological trigger to spend."

Loyalty and personalisation

The next step up from targeting you with special messages and discounts based on where you are, is offering you special deals based on who you are.

This already happens to some degree. Think about the offers you get through supermarket loyalty programs, such as 'spend this much over this many weeks to get this much off your shop'.

The details about how much you have to spend to secure what size discount will have been worked out by a computer algorithm. It's personalised to the extent that it's based on your past purchasing history (and whatever else the supermarket knows about you).

However, as tracking technologies and data collection ramp up, so will the ability to create highly personalised marketing. That includes different prices for different people – personalised pricing – as well as dynamic pricing.

As tracking technologies and data collection ramp up, so will the ability to create highly personalised marketing. That includes different prices for different people

Dynamic pricing is when prices jump around in response to supply and demand. For example, the cost of plane tickets changes constantly, depending on how many people are searching for that route, in conjunction with a myriad of other factors.

Bowden says, "Big brands like Amazon already use dynamic pricing by relying on their algorithms to harvest and process real-time data on customers, as well as their supply chains and inventory levels, and then customise offerings to consumers loading up their online carts."

"With personalised pricing, retailers use harvested customer data to understand an individual's needs, and then offer them a personalised price deal. The underlying principle is that loyal consumers might get a better offer than new consumers… much like a loyalty reward delivered on a one-on-one basis."

Electronic labels and dynamic pricing

Personalisation will be further enabled as technologies such as electronic pricing are implemented. The paper and plastic stickers that we're used to will be replaced with little screens displaying the barcode, product name, price and any discount information.

Sung says that when paired with beacon technology, wayfinding and usage of the store app, the combination of personalised and dynamic pricing becomes a possibility.

So, taking the example of buying cereal, the discount being offered by the store to a segment of its customers – say, loyalty members using the store app – might be augmented with an extra deal just for you, signalled via the app or the actual shelf labels, which can change as you move closer or further away.

According to Sung, there's also potential for those little electronic screens to carry short grabs of targeted marketing.

"Instead of you just looking at the pricing, now there's space to showcase the unique selling points of the product, or to run a call to action," he says.


Electronic labels allow shops to update labels in one fell swoop at a central computer.

It's a big investment for a business to adopt this kind of retail tech, especially if it has a huge amount of stock – Woolworths says it needs tens of thousands of electronic shelf labels per store as it implements digital pricing.

Coles is also going digital in the fresh produce and grocery aisles of some of its stores, starting with the Southland Victoria store that opened last year.

The benefits for retailers are long-term. They include a new way to deliver highly personalised marketing messages and pricing, and the ability to update labels in one fell swoop at a central computer, rather than manually changing every sticker.

The foundations of consumer protection and consumer law are based on the idea of fair and transparent pricing, and giving consumers choice

Kate Bower, CHOICE Consumer Data Advocate

Kate Bower, consumer data advocate at CHOICE, says we need to start having discussions about differential pricing because a lot of the foundations of consumer protection and consumer law are based on the idea of fair and transparent pricing, and giving consumers choice.

"When we move into personalised pricing, consumers don't have that level of transparency, and they lose that buying power," she says.

"There's huge potential there for discrimination and inequality. If some people are paying less, that means some people are paying more."

RFID and AI-assisted checkout

Another innovation for labelling and mapping inventory is RFID tags. RFID stands for radio frequency identification, and it's an old, widely used technology.

For retail use, tiny microchips with a product identifier and sometimes other information are embedded into individual tags.

Bowden explains, "RFID tags give retailers X-ray-like vision to see how much stock they have in real time, and where the stock is best displayed to gain attention. Are customers picking up the product, moving it to change rooms, abandoning it or buying it? If they're buying it, what are they buying it with?"

Like digital pricing, RFID tags require a large up-front investment. But it's worth it for some retailers, with the ability to track merchandise and ultimately save money on the cost of ordering and pricing stock, and staffing the checkouts.

Will staffed checkouts be around for much longer?

It's hard to tell. Supermarkets do seem to be investing more in self-checkout technology. Woolworths has implemented AI technology and cameras at the self-checkouts, which it says are to help reduce mis-scans and speed up the process for customers.

RFID checkouts are relatively new in Australia but are already making purchasing products a lot simpler. At some retailers , you drop all your purchases in a holder at the checkout, where an RFID reader instantly reads all the tags. Up flashes a list of items and prices, you hit 'accept', swipe your credit card, and you're done.

 In the UK, checkout-free supermarkets are also being trialled by big chains

An even simpler iteration involves scanning your brand loyalty card, walking past an RFID reader with your bagged items, checking the total on screen, and leaving. Your credit card, which is linked to your loyalty card, is charged, and a receipt sent to your phone.

Meanwhile, Amazon has abolished checkouts altogether with its Amazon Go stores in the US and UK. You scan the Amazon app on entering, then grab what you want from the shelves and walk out. Your credit card is charged, and a receipt appears on your phone. In the UK, checkout-free supermarkets are also being trialled by big chains like Aldi, Tesco and Sainsbury's.

Surveillance and facial analysis

Easy check out and personalised deals might sound pretty good. But the trade-offs for consumers include an environment of increasing surveillance and data collection that we're often not even aware of.

Take the digital billboards dotted around shopping centres. They're not just showing you advertising – they may also have a camera inside watching you. From the image, an algorithm estimates your gender, age, whether you have facial hair or glasses, your position and number of glances, before serving up what it deems to be a suitable bit of advertising.

As the ad plays, the camera analyses your face to work out your mood while you are watching.

"One of the dangers of this, aside from the fact that it's incredibly intrusive and you probably don't know that it's going on, is that there's often a pseudoscience to this stuff," says Dreyfus.

"Marketers might say they can determine your mood and reactions, maybe that's true and maybe it's not. But you certainly wouldn't want to have important decisions made about your preferences based on how accurate a marketing company's reading of your face is."


Some digital billboards contain a camera which analyses your face while you're watching the ad.

The technology being used is behavioural analysis or facial analysis, not to be confused with facial recognition technology (FRT). The latter captures biometric data and is used in settings such as airport security and policing. It has also been used in Australian retail, though this was paused following an investigation by CHOICE

Bower says the science is wonky, but with facial analysis, they claim they can assess people's sentiment, whether they're happy or sad or angry or frustrated. "It's one of the many ways we're being surveilled without our knowledge."

So, how can that be legal? The problem, says Bower, is Australia's Privacy Act, which is currently under review.

Data collection and monetisation

"The Privacy Act was developed in the 1980s when many of these tracking technologies didn't exist," says Bower. 

"Also, the types of personal information that were considered in need of legal protection were quite narrow. The information you gave was name and address, and maybe phone number. The law didn't have in mind the kind of information that can be collected now."

And that information can now far exceed what you give at the time of signing up to a loyalty program or shop app.

Retailers can buy extra information about you from data brokers, and that can extend to your online browsing history, things you've bought on other websites, views you've expressed on social media, and even how 'influential' you are.

They mash all this together to work out your value to them as a customer, and what kind of deals you should be offered.

The law around this is not entirely clear, so some companies argue that these methods of collecting and using your behavioural information are currently excluded from the Privacy Act.

The big retailers with their huge loyalty program memberships hold a wealth of this information on consumers, while consumers know very little about retailers. The power imbalance is huge

It's worth noting, too, that in the data soup, your name is not actually that valuable. "It's your behaviours that are valuable," says Bower. "What you buy, where you buy it and when you buy it."

"A business might say it doesn't sell your data, but what they do is use your data, your purchasing history, to generate insights that they can sell," she continues. 

"For example, people who buy pet food on Thursday nights also do x, y and z. It's the detailed behavioural insights about groups of people that generate the value."

The big retailers with their huge loyalty program memberships hold a wealth of this information on consumers, while consumers know very little about retailers. The power imbalance is huge.

"Businesses are making millions," says Bower. "What the consumer gets is maybe a free frypan or $10 off their shop."

What changes are needed to protect consumers?

One of the recommendations of the Privacy Act review is to expand the wording about what constitutes personal information from information about a person to information that relates to a person.

"That alone will help to clarify that things like telephone metadata are protected," says Bower. 

"But we also need the law to clearly include things like digitally tracking people so that a retailer can track, profile and target them without necessarily knowing their name," Bower continues.

"Consumers' expectations are that you shouldn't have a business being able to track you secretly around shopping centres or access your web browsing history or Facebook profile, and then use that information to advertise to you or manipulate your purchasing behaviour."

How retail stores are tracking you

CHOICE consumer data advocate Kate Bower takes to the streets to ask shoppers how they feel about some of the retail technologies now being used to monitor customers when they shop.

The future

While it's easy to see why retailers might be excited about the innovations in tech that have the potential to make their businesses more profitable, some shoppers might also be delighted by this digitally enhanced, retail tech-driven shopping day described by Bowden:

"You wake up in the morning and try-before-you-buy via AR (Augmented Reality). You go online and AI-powered recommendation engines, which drive intent to buy, conveniently feed you suggested brands and products."

"You go into a store and your movements are tracked by geo-locator tech to personalise on-the-spot promotions. On entering the change room you try on clothes in front of a smart mirror which has an in-built scanner to gather thousands of data points on your body and create a virtual 'twin' to model hypothetical outfits for you."

What consumers think

For most consumers, this vision lacks appeal. Bowden says that as customers become aware of retail tech innovations, research shows they are resistant to it. 

"Only eight percent of Australian consumers say they are very willing to share their location data with retailers."

"Consumers are also deeply concerned about their privacy and the collection of data on their personal movements, especially if they perceive that this information will be used opportunistically by brands looking to exploit the data."

CHOICE research backs this up. In January 2023, our nationally representative survey found that:

  • 64% of Australians are concerned about businesses collecting data about them
  • 56% are concerned about their data being used to personalise advertising or marketing.

Sung believes that consent around data sharing will soon become a key issue. "Nowadays, it's yes, I'm happy to share, or no, I'm not."

In the future, he says, it will be more nuanced.

"Someone might decide, I just want to share my habitual purchases, or I just want to share what I bought in the last three months but not my whole history," he says. "Or maybe, I don't want the supermarket to link what it has from my online shopping with my footsteps in the physical store."

As it stands, consumers have little understanding and even less say in how the data collected as they shop is used. 

"As you walk through the shopping mall you can't control the information that is being gleaned about you and passed on to other people. You don't even know about it, let alone control it," says Dreyfus.

64% of Australians are concerned about businesses collecting data about them

It will be hard to opt out altogether, though, from tracking and data collection.

"Realistically, most of us won't bother turning off Wi-Fi or disengaging with loyalty programs as long as they're offering us extra value and discounts," says Bower.

"The best thing consumers can do is write to their elected representative, and ask for new and amended protections under the Privacy Act."

We care about accuracy. See something that's not quite right in this article? Let us know or read more about fact-checking at CHOICE.

Stock images: Getty, unless otherwise stated.