Is this why grocery stores are so keen to get you to use their coupon app or hand them your phone number? I always refuse, but I always wondered what they do with the data.

The amount of "discount" is so much that they must be getting a large income stream from the data. Whenever I see something where the shelf sticker claims a lower price for "digital coupon" (meaning: use their app), I put the item back onto the shelf and move on. I'm willing to use the loyalty cards, but I am not willing to allow the sort of surveillance data that phone apps provide.

Margins on items at grocery stores is pretty thin. For them to be able to offer 50¢ or $1 off for items by using their app, that tells me that they are making more than that much from the data about me. My suspicion is that they're earning at least 10x that much from the data.

Yes, unfortunately as an example to the problem here my grocery store charges around 20-30% more for the privilege of not using the app. Eventually I relented because I needed the 'savings' and it was the only grocery store available to me.