Why Don't More Shoppers Worry When Big Data's Watching?

Online They Seem to Expect It, In-Store They Don't Know or Just Want Bargains

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You wouldn't know it from the lack of public outcry, but 64% of retailers are collecting Big Data tracking their customers' shopping behavior, according to a recent study by Brick Meets Click. The companies use this data to drive more qualified traffic, better manage inventories and offer store-specific assortments, tailored to the wants and needs of their shoppers, both online and in stores.

The majority of the 3,000 people we surveyed in June on a Horizon Media online consumer panel -- nearly 7 out of 10 -- were at best only somewhat aware of this tracking. When asked if they think that the data collection is invasive or beneficial, just over half take a mid-ground stance. Even among those who feel that it is invasive, nearly six in 10 said that they haven't changed any of their shopping behaviors to resist being followed.

Why so much complacency? It could be that while consumers often expect to be watched in the digital space, they don't imagine that their purchases could be tracked at pharmacies, grocery stores and department stores and linked to data that's been gathered about them online. Unless the data-gathering point is a computer or mobile screen, people don't think about it much.

But a recent decision by Nordstrom to stop testing an electronic system that followed customers' in-store mobile activity shows that when you let shoppers know that you're tracking them, as Nordstrom did, they aren't happy about it. In this case, many shoppers complained of feeling stalked, and the store was forced to back off.

Beyond just complaining, though, if you really want to make it difficult for retail stores to know too much about you, it means making a wholesale adjustment in the way you shop, paying in cash and giving up your store-based loyalty program, along with its coupons and deals. But nobody -- not even those who feel their privacy is being invaded -- seems willing a real shift in their behavior.

Eighty percent of people in our survey told us that although they may not be happy about companies getting their personal information, it's going to happen anyway so "I just have to live with it." Or they put on their bravado cap -- "I'm not going to let these people change the way I shop."

Of the things that people could do to keep out of Big Data's nets, the two most common -- creating unique log-ins for each account and regularly clearing web-browser history -- are used by just over 50% of respondents in our study. Those actions don't actually have much of an impact on keeping your movements undercover. Paying in cash or going cold turkey on store loyalty programs, both of which could start to break the tracking chain, have been done by at most 20% of people we talked to. It's not that they don't realize they could do these things; they choose not to.

Finally, plenty of people want deals or offers tailored to their specific tastes, including those who think data collection is invasive. More than half of our respondents have taken the lemons-to-lemonade approach of "I don't like that they have this information, but at least I'm getting customized offers." The New York Times encountered this same mentality when reporting on the Nordstrom situation, when a number of shoppers said that if they got a deal of out the cell-phone tracking exercise, so much the better.

What could turn this big shrug into frenzied activism? One thing would be if retailers take their customer data out of their own space, making it public in some way or sharing it with others outside of their own domain. For those we talked to, this would constitute misuse and might spark not just an outcry, but a real change in behavior. The other big no-no is lack of transparency when actively collecting customer information. Just recently, for example, Urban Outfitters, was sued in Washington, D.C., for giving consumers the impression that their zipcode was required to process their credit card, when in reality it was to add to the retailer's customer database for marketing activities.

In the meantime, though, it's business as usual. For the people who really care, Big Data may be a big deal, but the average person just isn't that interested -- at least as it relates to the retail experience.

Sheri Roder is chief of the Why Group at Horizon Media.

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