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Illustration: Brendan Lynch/Axios

Face-recognition tech is coming to a store near you, if it's not there already, and that's sparking a new wave of opposition.

Why it matters: The systems can scan or store facial images of both shoppers and workers. Their use accelerated during the pandemic as retailers looked for ways to prevent fraud, track foot traffic with fewer employees, and offer contactless payments at a time when consumers were wary of interacting with others.

Driving the news: More than three dozen advocacy groups launched a campaign late last week to pressure retailers to stop using facial recognition technologies, or to pledge not to use them.

  • "Facial recognition vendors are taking advantage of the pandemic to promote the technology to offer hands-free payments or monitor the distance between people, and stores are promoting them as features for safety and convenience," said Caitlin Seeley George, campaign director for Fight for the Future, which spearheaded the campaign.
  • "But the truth is, you're giving up so much more than that," she said.

Where it stands: Stores including Walmart, Kroger, Home Depot and Target have said they won't use facial recognition technologies, per the advocacy groups' running list of retailers.

  • But Albertson's, Macy's and Apple Stores are among major retailers that do use the technologies, per the groups' list. Their privacy policies say they use it for security and to prevent fraud.
  • Apple was sued by a Black New York man who was misidentified as a shoplifter by the facial recognition security system.
  • Studies have shown that facial recognition technologies are far less accurate in correctly identifying nonwhite and female faces than white male faces.

How it works: Facial recognition tools are primarily used by retailers for security reasons — chiefly, to prevent shoplifting — and they usually don't link images to personally identifiable information, says Brenda Leong, Senior Counsel and Director for Artificial Intelligence and Ethics at the Future of Privacy Foundation.

There are plenty of other ways stores would like to use the technology, she said, such as:

  • Identifying loyalty club members the minute they enter a store to send them push alerts and text messages about deals or products they're likely to be interested in.
  • Knowing exactly how long a customer is in the store to help tailor their experience in future visits.
  • Using biometric systems for employees to clock in and out and track workers' whereabouts and monitor productivity. Advocates find this use particularly concerning because employees do not have the choice to opt out.

What's happening: In China, Alibaba and JD have opened futuristic grocery stores where automated carts follow you around, wrist trackers scan your selections and payments are made by facial recognition systems, per Wired.

  • In its new Amazon Fresh stores, Amazon offers cashier-less "Just Walk Out" technology. The company says it that system doesn't use facial recognition. Instead, customers select their entry method at the store to let Amazon know they are shopping.
  • Then, a combination of computer vision, sensors and deep learning determines what shoppers took off or returned to shelves.

The other side: Just because a camera is used in a store doesn't mean it's identifying or storing specific faces. And companies argue the systems can improve shoppers' in-store experiences in other ways.

The intrigue: Biometric information, like finger prints and facial images, is protected as personal data in states with strong privacy laws, like California.

  • The city of Portland, Ore., became the first U.S. city to ban the use of facial recognition by the government, police and commercial enterprises like retail stores, hotels and restaurants.
  • The use of face-recognition tech is becoming more widespread within the federal government, with 20 out of 42 federal agencies that employ law enforcement officers using it, per a recent GAO report.
  • Last month, Democratic Sens. Ed Markey and Jeff Merkley reintroduced a bill that would ban federal agencies from using biometric technology.
  • A group of 50 investors last month called on companies involved in the use of facial recognition technology — including Amazon, Facebook, Alibaba and Huawei — to do so ethically, Reuters reported.

Stadiums, amusement parks and cruise ships are among the venues where facial recognition use is more mature. The technology observes crowds, locates unruly guests, can identify guests for priority access to rides or restaurants and track where they are to direct offers to their phones or wrist bands.

  • People are generally less creeped out by those experiences because they know they are entering a "closed" environment of sorts and that they are benefiting from sharing that information with the companies, Leong said.
  • "But you don't have those same expectations of being tracked when you happen to walk into a store. A grocery store isn't a place you can avoid going. Maybe your choice of food is more sensitive than the ride you are going on," she said.

What to watch: Some industries, including retail, are experimenting with biometric technologies that can interpret facial expressions, detect sweat on a person's skin or identify an elevated heart rate.

"If someone walks into a drug store and they can intuit that they are anxious or worried, are they going to try to market them a sleep aid?" said Leong. "Some retailer could take advantage of someone’s emotional state without that person's knowledge. There's a real imbalance of power there."

Go deeper

Linh Ta, author of Des Moines
Sep 14, 2021 - Axios Des Moines

Hy-Vee's reimagined grocery store opens in Grimes

A food dining hall in the new Grimes Hy-Vee. Photo: Linh Ta/Axios

Hy-Vee's newest grocery store opened in Grimes Tuesday morning, featuring some of the company's latest modern experiments in attracting customers.

The concept: The 93,000-square-foot facility is the company's first venture into a "smart store" — a grocery store that integrates digital conveniences like scan-and-go shopping, where customers can skip lines by using an app to buy their items.

  • Large portions of the store are also dedicated to Hy-Vee's non-grocery partnerships, like DSW, The W Nail Bar and Joe Fresh clothes.

What's new: Kiosks are located throughout the store to help you do everything from order a custom cake to buy an elliptical machine.

  • Looking for high-end wines? You can find $1,000+ bottles in the store's wine and spirits section, plus a cigar room.
  • There's a hot food area that functions like a food hall. Order at a kiosk, sit down and someone will bring out your Hy-Chi.
  • There’s no more paper price tags in aisles. They’re digital instead, requiring less labor.
  • And yes, a vending machine will even make you a custom salad.

Yes, but: If you want to do things the old-fashioned way, all of the traditional in-store shopping features are still available.

The big picture: Consumers' schedules are packed and our dollars go towards what's most convenient.

  • CEO Randy Edeker said this latest store aims to be a one-stop shop that saves trips to multiple stores.

Thought bubble: If we're spending time in brick-and-mortar, experiential shopping is key.

  • The store's surprises — like hard-to-find liquors, international candies and even a kiosk selling glasses — keep you looking around.

What's next: Watch out for more Hy-Vee news from us Wednesday.

Scoop: Biden to tap privacy hawk for FTC post

Photo: Jeffrey Greenberg/Universal Images Group via Getty Images

President Biden will nominate Georgetown University law professor Alvaro Bedoya to be a Democratic commissioner at the Federal Trade Commission, people familiar with the matter told Axios.

Why it matters: Bedoya, founding director of the Center on Privacy & Technology at Georgetown, will bring a bevy of experience on privacy issues to the FTC's work on tech.

Scoop: Beto plans Texas comeback in governor's race

Former U.S. Rep. Beto O'Rourke speaks during the Georgetown to Austin March for Democracy rally on July 31, 2021 in Austin, Texas. (Photo by Brandon Bell/Getty Images)

Former Rep. Beto O’Rourke is preparing to run for governor of Texas in 2022, with an announcement expected later this year, Texas political operatives tell Axios.

Why it matters: O'Rourke's entry would give Democrats a high-profile candidate with a national fundraising network to challenge Republican Gov. Greg Abbott — and give O’Rourke, a former three-term congressman from El Paso and 2020 presidential candidate and voting rights activist, a path to a political comeback.

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