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March 14, 2013

Tracking customers via their smartphones

by Lisa

A recent article by is headlined: “There is a Good Chance You Are Being Tracked While You Shop.” New tracking software on smartphones is enabling a start-up company, Euclid, to secretly track customers as they shop. As of right now, the company is not required by law to ask permission before it tracks customers as they either pass by a store, or enter and shop around. Senator Al Franken from Minnesota has recently challenged this, stating that it goes against customers privacy rights.

Stores have been using customer loyalty cards now for years, trying to collect data and discover new ways to increase the amount of money they can collect from individual customers. The tracking software would go one step further than loyalty cards by analyzing specific customer behavior as they walk around the store. Collecting this data could be profitable for companies as they try to enhance both storefront appearance and also store layout. Companies could find that customers spend more time in certain parts of the store than others, and use this knowledge to improve where products are placed in the store. It could also improve the coupons sent to customers on their phones as they maneuver around the store. Lastly, this added data would give companies a more detailed view of their customers (in comparison to just knowing what items they purchasing during their visit).

The debate in the article is whether companies should be required to ask customers before they are tracked, and whether this invades a customer’s right to privacy. Would customers agree with Senator Franken, or will they instead see the potential benefits of this new software — better store layout and more ‘accurate’ coupons?

Customers are already being bombarded by coupons, loyalty programs, and surveys every time they shop. Sometimes the combination of these things actual limit the customer’s positive experience. Therefore, in my opinion, this software might actually improve a customer’s experience. The ‘secret’ tracking could end up making customers feel less bombarded and lead to a more enjoyable experience (and potentially more money spent).

After all, ignorance is bliss…



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