Personalization or Privacy: The Fine Line


Where is the line between cool and creepy? It's not an easy question to answer, at least when it comes to retail analytics.

Why do consumers like getting personalized discounts at the grocery store but find it invasive for another retailer to tell them that an item they browsed online is in stock -- in their size?

Why do consumers feel special when they get relevant solicitations from one company and upset when another suggests possible purchases based on their buying patterns?

As David Mattin, lead strategist at the independent agency Trendwatching, told me for a post this week, sophisticated customer intelligence poses opportunities and challenges. "Privacy is a key question here," he said. "Consumers are willing to share their data, with two provisos: They will not accept flagrant abuses of trust, and, increasingly, that they expect to benefit."

When IBM surveyed more than 28,000 consumers early this year, it found them willing to tell retailers about their media use (75 percent); demographics (73 percent); identification, such as name and address (61 percent); lifestyle (59 percent); and location (56 percent) in exchange for more targeted and smarter shopping experiences.

No one disputes the fact that data is a huge issue right now, or, as Mattin put it, "consumer expectation around data -- and the innovations that brands and businesses are launching around data -- are key forces helping to shape the consumer arena."

For several years, retailers have been expanding their use of customer data. Using data amassed from loyalty card use, Kroger is just one of numerous grocery store chains offering personalized in-store discounts to give shoppers money off their favorite brands.

Now companies are going even further -- using consumer data to shape products and services before consumers even use them. Mattin cited the Know Me program British Airways launched in July. It uses Google Images to source pictures of VIP passengers before their arrival at the plane or terminal, enabling staff to greet customers personally. "Staff can also use iPads to access information on passengers' previous experiences with BA, meal preferences, and onward travel plans, all to help tailor the passenger experience."

Is that cool -- or creepy? Where do you draw the line?

Noreen Seebacher,

Noreen Seebacher, the Community Editor of Investor Uprising, has been a business journalist for more than 20 years. A New York City based writer and editor, she has worked for numerous print and online publications. Her work has appeared in The New York Times, the New York Post, New York’s Daily News, The Detroit News, and the Pittsburgh Press. She co-edited five newsletters for Real Estate Media’s GlobeSt.com and served as the site's technology editor.

She also championed the commercial real estate beat at The Journal News, a Gannett publication in suburban New York City, and co-founded a Website focused on personal finance. Through her own company, Stasa Media, Noreen has produced reports, whitepapers, and internal publications for a number of Fortune 500 clients. When she's not writing, editing, or Web surfing, she relaxes in an 1875 Victorian with her husband and their five kids, four formerly homeless cats, and a dog.

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Re: Value
  • 12/29/2012 2:23:14 PM
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A countermeasures industry? I think that is what free marketers would dictate happen ... So chances are that, yes, in the USA that is the average person's only hope of protecting their privacy.

Re: So cool it's creepy
  • 12/29/2012 8:43:55 AM
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True, monitoring how the privacy line is changing will be a challenge, probably the most talked about subject in 2013.  When does monitoring one customer's selection become a nuissance when the customer makes a switch? How does a company deploy the right resources to manage?  Given Target's baby diaper incident earlier in the year, retailers should see these kinds of questions appear more frequently and more publicly in some instances.

Re: Value
  • 12/28/2012 11:40:28 PM
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..

Kq writes


Maybe, customers can be provided a sliding scale of permissions they wish to grant to data collecting websites. Selecting from 0 to 10 would give consumers some real control over what they perceive as the appropriate amount of data they want to volunteer.


 

Well, as I've said in a previous thread, basically privacy is toast.  I think big business and the government will find ways around any rules, and the averge Joe or Jane can only try to bollix the snooping as much as possible.

I sorta expect some kind of "countermeasures" industry to arise.  There's a market for everything...

 

Re: Value
  • 12/28/2012 6:33:29 AM
NO RATINGS

I suspect men are a bit more tolerant of any perceived privacy invasions than women. Knowing that companies are data mining my most personal bits of web history doesn't really bother me at all. I've given permission, even if sometimes inadvertently, and as far as I know, haven't been harmed.

But there are those who by nature or nurture just don't want anyone gathering their personal information. 

Maybe, customers can be provided a sliding scale of permissions they wish to grant to data collecting websites. Selecting from 0 to 10 would give consumers some real control over what they perceive as the appropriate amount of data they want to volunteer.

Re: Value
  • 12/26/2012 11:34:46 PM
NO RATINGS

..

Earlier I wrote


The whole issue of smartphone non-privacy, and intrusive tracking and snooping by companies and other snoopers, was the focus of a CBS This Morning report this AM.  I'll try to find and post a link when CBS posts it


 

OK, CBS posted the links to these news segments:

Smartphone snoops? How your phone data is being shared

Tech expert offers privacy tips for smartphone users

 

Re: Value
  • 12/26/2012 9:31:54 AM
NO RATINGS

..

Alexis writes


Yesterday out of no where I received am offer from Amex on my phone because I was close to the restaurant it was promoting. Hht fact that oh knew my location was a little creepy!


 

The whole issue of smartphone non-privacy, and intrusive tracking and snooping by companies and other snoopers, was the focus of a CBS This Morning report this AM.  I'll try to find and post a link when CBS posts it, but meanwhile, here are some highlights I recall...

The story started with a reporter stopping a man and child on the street to use their smartphone to snap a photo of them.  Via Instagram, the photo was then sent to a CBS consultant who immeditately identified their precise location (and in fact joined them within a few minutes).  The main point of this segment was that most people don't seem to be aware of the volume of info about their behavior and whereabouts that their phones are "broadcasting".

The focus then shifted to an in-studio interview with the CEO of Techonomy, who emphasized that a lot of the emergence of snooping capabilities, even with loss of privacy, is embraced by much of the public — younger people especially — because of the facilitation of social interaction and (ahem) sexual pursuits (he gave as an example the SceneTap app).  He also underscored that the explosion of smartphone apps illustrates that Analytics/Big Data (which he referred to as "data analytics") is one of today's foremost growth industries.  As the segment drew to a close, there was more discussion aboiut the difficulties of trying to preserve some remnants of privacy.

 

Re: Creepy, maybe. Annoying, definitely
  • 12/24/2012 12:02:17 AM
NO RATINGS

..

Beth writes


That is definitely a waste of advertising money, especially as opera glasses, even if a personal purchase and not a gift, certainly can't be a repeat purchase. Unless you're prone to losing stuff.


 

Yes it's a waste.  Hey, wait — isn't good analytivcs supposed to prevent that?  Sounds to me like there's a lot of heavy-duty analytics and algorithmic refining that needs to be applied to all this online marketing...

 

Re: Creepy, maybe. Annoying, definitely
  • 12/19/2012 12:51:26 PM
NO RATINGS

@Seth that's a good option for marking items as gifts. I would like Amazon to work on a solution like this. There's a way to personalized suggestions there but who cares to spend the time clicking off items that were gifts?

Re: Value
  • 12/17/2012 10:13:56 PM
NO RATINGS

@Alexis, that sort of location-based spam marketing makes me want to turn off my smartphone whenever I am not actively using it.

Re: Creepy, maybe. Annoying, definitely
  • 12/17/2012 7:40:54 AM
NO RATINGS

I rarely let a merchant know something is a gift because I don't want to pay extra for a box!

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