Wednesday, May 24, 2006

To Scan, Or Not To Scan? - That Is The Question

At the register, the contents of a customer's shopping cart are recorded and stored in a computer, giving the retailer a profile of the customer's purchases as well as help with inventory control, product placement and other strategic decisions. Photo Credit: JACOB LANGSTON/ORLANDO SENTINEL

If one stops to consider just how much information is floating around out there about themselves, one must get to the point that a modification in behavior is the only way to limit or protect ones identity information.

Truthfully, the Federal Government's NSA eavesdropping/wiretapping effort has nothing on you compared to the broader databases housed at retailing establishments.

This from the Orlando Sentinel -

Retailers gather data the same way spies do
'Data mining' provides valuable clues to customers' spending habits.
Chris Cobbs Sentinel Staff Writer Posted May 22, 2006


Using powerful search tools, computers can now sift through millions of electronic records to study patterns of behavior that could uncover terrorist plots -- or boost sales at the supermarket or drugstore.

"Data mining," as it's called, may have been used by the National Security Agency on millions of Americans' phone records in a quest to find planned acts of terrorism. Congress has expressed concern that such a secret data-gathering project, disclosed this month by USA Today, may violate citizens' privacy rights and civil liberties.

But the same methods are also widely used by retailers, who assemble computerized collections of customers' purchases along with their names, addresses, income levels and other tidbits, giving businesses clues to people's buying habits on a giant scale.

Although some experts contend that such data mining may be an invasion of privacy, others say it's actually more about spending than spying.

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"They have no interest in doing anything malicious with the data, because their interest is economic," he said. "They don't want to harm you -- they want you to come back to them and shop."

A common way to accumulate information is through discount or loyalty cards. When the card is used at the checkout register, details of what's in the customer's shopping cart are recorded and stored in a computer, giving the retailer a purchase profile of the customer as well as help with inventory control, product placement and other strategic decisions.
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The benefits to shoppers include targeted coupons for favorite products and in-store credits based on a percentage of purchases made the previous quarter.
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Among grocery chains, there is a split among Publix Super Markets and Albertsons on the use of the discount cards, a key element in data mining.

Publix tried them in the early 1990s but doesn't use them now because of concerns about privacy, spokesman Dwaine Stevens said.

"The privacy of our customers' shopping is a priority," he said. "We don't track individual buying habits. Information about individuals is not in our archives."

Publix doesn't need information obtained from a shopping database to track its inventory, Stevens added.

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Albertsons also puts a premium on privacy but says customers like the discounts they receive from the company's "targeted marketing" program, spokesman Shane McEntarffer said.

Newspapers such as the Orlando Sentinel use data mining to help tailor their marketing efforts as they seek to increase subscribers, said Ashley Allen, spokeswoman for Orlando Sentinel Communications, which publishes the newspaper.

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Consumer advocates and privacy-rights groups raise concerns about the security of such shopping data, noting that the average American appears in as many as 50 commercial databases.

"All this personal information is a hot commodity that businesses are collecting, using and sharing," said Brad Ashwell, consumer and democracy advocate for Florida PIRG (Public Interest Research Group).

"The more information that's compiled, the easier it is for others to find, which contributes to ID theft. We want to see regulations and hard consequences."

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"In the private sector, it's driven by marketing, while in national security, the search is for dangerous individuals," he said. "But the larger issue is how much data is collected and how long it's stored. Consider that Google stores every search query that's ever been typed, and you get a feel for it."

However, those fears are unfounded, said Britt Beemer, the Orlando-based chairman of America's Research Group, a consumer-behavior research company.

"I work for some of the biggest Fortune 500 companies, and none of them rent or share information about customers," he said. "All the people in the consumer-interest groups see a bogeyman behind every tree."

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To scan, or not to scan - that really IS the question!

Post republished at Symblogogy, the automatic identification & data capture weblog for all things AIDC.

1 comment:

voiceboy said...

At my local suremarket (chain) ,the number I use to get my "discount" is my actual tel #,but in their sutsem it shows the OLD owner of that number,so they always say "thank you Mr x",and since I always pay cash, I giggle every time.My Dad would be proud,he was onto this scam years ago.