Forget Big Government: How big retailers can learn intimate details about your life

Can you imagine being a teenage girl in high school who gets pregnant and having your father learn that fact from seeing coupons for baby goods in his mailbox one day? Thanks to the power of today’s marketing technology, that recently happened to a Minneapolis high schooler who shopped at Target.

The New York Times had a piece last week on what big box retail giant Target – and presumably other, similar merchants with the means – are doing to learn more about their customers. Using data on their demographics and purchase history – tracked using credit card numbers or e-mail addresses, they make educated guesses on what people are looking to buy and their marketing team can target them accordingly.

This concept of one-to-one marketing is nothing new – Amazon.com has thrived on it for years. But what made the New York Times story so interesting, as this analysis on Forbes.com notes, is how it can lead to you being targeted so specifically that details about your personal life get out to people you don’t necessarily want to know them, at least not that way.

As Forbes‘ Kashmir Hill and the Times’ Charles Duhigg describe, Target used a mathematical formula based on products purchased and even the colors of those products to calculate a “pregnancy prediction score” – a number indicating the likelihood that you’re expecting. Target’s statisticians have even developed a means of guessing how close you are to your due date. And this data can be remarkably accurate.

Duhigg reports that Target sent coupons for baby clothes and cribs to the aforementioned Minnesota teen based on her “pregnancy prediction score.” When her father saw these coupons, he angrily went to the local Target and demanded to speak to a manager, who apologized. But said father was the one apologizing a few days later when he found out that his daughter was indeed pregnant.

I don’t intent this to be a rant against one-to-one marketing. Businesses are out to make money and the more finely you can tune your marketing to the needs and desires of specific customers, the more likely you are to get sales.

But it does illustrate the power of the data merchants like Target have at their disposal. And it also illustrates the need to be careful with what information you give out.

Have any of you had an experience where a merchant started targeting you with offers based on information you didn’t want out in the public domain?

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