When Albertsons LLC announced last month that it was ending the loyalty card program of stores acquired from Supervalu, the talk was about how this would affect their marketing capabilities.
After all, loyalty programs deliver a rich trove of data about shoppers’ past purchases that can be translated into attractive personalized pitches. Albertsons is forgoing all that for a more holistic approach to their customers.
But Albertsons is also giving up something else — privacy headaches associated with the vast database of consumer information generated by loyalty schemes. The chain can never be accused of harboring personal data about its shoppers’ in-store shopping habits, or sharing it with other entities, though that was not the reason it dropped the program, said spokeswoman Chris Wilcox.
A few weeks before Albertsons made its marketing decision, Edward Snowden, a former contractor for the National Security Agency (NSA), leaked details of top-secret U.S. surveillance programs to the press. The leaks revealed that the NSA, in order to prevent terrorist attacks, has been secretly tracking a wide range of information on Americans, including telephone calls, email, video, social media posts and more.
Read more: Albertsons Evaluates Loyalty Cards Across All Banners
The NSA revelations have sparked a nationwide debate about whether the government is going too far in its surveillance efforts, but they’re also shining as never before a spotlight on the massive electronic data trail each of us is leaving behind, both deliberately and in many cases unwittingly.
At stores with loyalty programs and other digital services, shoppers are providing information reflecting at a minimum on their eating habits and potentially their health and ethnicity — data in which not only other businesses and insurers but also government entities could be interested.
Many commentators have noted that Americans tend to take these privacy intrusions in stride, as long as they perceive a reasonable return, whether in the form of better deals or personal security.
But the Snowden case reminds us of the potential perils of massive data collection. Retailers need to be sensitive to the growing number of shoppers who are or will be uncomfortable with the idea that their shopping, Internet and mobile activities are being tracked. They need to be wholly transparent about what data they collect, what they do with it and whom they share it with.
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