How Data Mining Turns You Into A Super Consumer

Visual clues about you are just the tip of the information iceberg. Your shopping habits can be made malleable by others through data mining.

New York Times writer Charles Duigg wrote how Target predicted a teen’s pregnancy before her own father knew. He described a man demanding to speak to a superstore manager: “My daughter got this in the mail!” he said. “She’s in high school, and you’re sending her coupons for baby clothes and cribs? Are you trying to encourage her to get pregnant?”

The mailer, addressed to the girl, promoted maternity and baby gear. The clueless manager apologized, and when he later phoned the man to repeat his apology, the conversation turned surreal. “I had a talk with my daughter”, he said, “It turns out there’s been some activities in my house I haven’t been completely aware of. She’s due in August.”

Be careful at the intersection of data collection and human behavior.When we shop using plastic or customer “rewards” cards, retailers collect our purchase details for deeper analysis to promote more buying. Here’s what you should be aware of:

Researchers in university and corporate laboratories are exploring human impulse and subconscious pattern formation, better understanding what makes us tick, specifically in regards to consumerism. “Predictive analytics” are used to study our daily purchasing habits, interpreting patterns that enable businesses to be frighteningly efficient in their marketing.

Here’s how shopping analysis works. Items are linked into groups indicative of specific behavioral trends. Paper plates + ice bucket might = a one-off party, but retailers hunt for bigger game. They target shoppers with long-term purchasing commitments such as weight-loss (vitamins + sports drink + exercise DVD), or the zenith of stepped-up consumerism: parenthood (cocoa butter + folic acid + What To Name Your Baby).

Mathematical models translate our purchases into indicators of personal life events.  Major retailers assign us unique shopper codes, based on our credit or bank cards, or drivers’ licenses when using checks. All of our actions are linked back to that code.

Buy something, return it, use a coupon, call customer service: it’s recorded. Apply for a customer card or store credit and our personal demographics are filed too.

Did you go to school? File a tax return? Insure a car? That info, plus your age, address, marital status, household size and charitable donations are easily obtained from public records. More information about religion, ethnicity, what we read, who we date, and where we go online can be purchased outright third parties, even if we didn’t purposely share.

Mathematical analysis spins this data into marketing gold.

Computer analytics can plot our conscious and unconscious patterns. Regarding the Target teen, analysis identified a purchase array that scored high in “pregnancy prediction”, so refined that it estimated the stage of pregnancy, allowing the store to create coupons for items bespoke to her specific trimester.

“Target has always been one of the smartest at this,” says Eric Siegel, chairman of the Predictive Analytics World conference. “We’re living through a golden age of behavioral research. It’s amazing how much we can figure out about how people think.”

Target experienced over all revenue growth from $44 billion in 2002 when this analysis commenced to $67 billion in 2010. Duigg suggests predictive analytics helped them corner the mommy-and-me market.

Where will they next turn their sights? And they’re not the only retailer using this.

A Duke University study concluded that conscious decision-making is responsible for slightly more than half of our daily choices; the rest are simply learned routines.  I urge you to read the NYT article in full to appreciate how malleable our habits can be made by others.  Modern life can resemble a rat-race, but are you comfortable being manipulated to chase specific cheese?

Become a Cookie Monster

It’s serendipitous that my son just Facebooked me instructions on how to remove my Google search history before March 1, when that giant’s new privacy policy takes effect affecting their approach to data collection.  Presently, Google’s Web History function records data every time you search, and visit resulting sites. Those records had been segregated from other Google products, but that protection may change. I doubt my searches are sensitive,  but I don’t like the probability of my info being used by others down the line.  I suggest you clear your own history and stop your future browsings from being recorded.

I just did it, takes all of 4 minutes:

1. Sign into your Google account.
2. Go to https://google.com/history
3. Click “remove all Web History”
4. Click “ok”

Note: These steps must be repeated for each account. Removing your Web History also “pauses” it, it remains “off” until you re-enable it.  Can’t imagine why you ever would.

Tracking and data-mining are now standard practice. To avoid it requires serious effort.  You’re not okay with leaving footsteps every time you click?  Then use cash.

Skip the points/rewards cards.

Crumble cookie trails after playing online.

Barter.

But is it reasonable to think we can jump off the e-info grid in this age of  mobile phones, internet and air travel? Could you survive without Facebook, LinkedIn and Twitter?   Convenience comes at a cost to privacy.  My concern is that, like that targeted teen, we can’t begin to conceive the final bill.

Image via gabriellaap