Here’s the Real Reason Grocery Store Members Get the Best Deals

Find out how retail analytics are invading your privacy.

About 93 percent of American adults want to be in control of who can access information about them, according to a 2015 study from the Pew Research Center. This includes big data that retailers are collecting. What many people don’t realize is that member deals that cater to grocery store customers are made possible by customer tracking, which relies on private information.

You probably never stopped to think about why the grocery store cashier asks for your phone number, or the reason you have to sign up for a free loyalty card to access exclusive sales. Find out why you’re really saving big at the supermarket, and what you’ve given up to get those deals.

What Are the Benefits of Retail Analytics?

Retail analytics aren’t all bad. When stores collect data on you, it’s frequently used to provide a heightened customer experience. This involves everything from sending you exclusive money-saving opportunities to ensuring the store is well-staffed on your visits.

Gathering information on your buying preferences lets grocers anticipate your needs and keeps you engaged so you keep coming back for more. Software is used to analyze your shopping patterns and determine the best ways to capture your attention. This could mean you get coupons in the mail for your favorite products or, if you haven’t shopped at a certain store for awhile, you might receive a special offer to entice you to return. Remember, never buy these things without a coupon.

Customer tracking data also monitors loyalty, offering increased rewards the more you shop at a particular grocery store or chain. Essentially, retail store analytics can make it more convenient and cost-effective to frequent a certain grocery store.

What Are the Drawbacks of Retail Analytics?

Despite the many conveniences of customer tracking data, it comes at the price of privacy. Most U.S. adults — 90 percent believe that controlling the kind of information collected about them is important, but only 9 percent feel they have significant control over the amount of information gathered and how it’s used, according to studies conducted by the Pew Research Center in 2014 and 2015.

You might not realize it, but when grocers gather information about your shopping habits they don’t always keep it to themselves. Big data retail is a huge market, as many companies sell your personal information to other businesses for a quick buck.

This means your private shopping data i.e., your penchant for buying organic produce and white wine can be sold to corporations you’ve never heard of, without your consent. Not only has your privacy been invaded, you’ll also be targeted by the companies who purchase the data, as they work to win your business.

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How Is Retail Store Data Collected?

Every grocery store has its own way of gathering retail analytics. Most employ a combination of many tactics, including using security camera footage to study your emotions. Loyalty cards, which are free to obtain and often necessary to take advantage of sale prices, serve as a huge source of information. Though seemingly innocuous, these cards have some serious customer tracking abilities, which is how you get coupons tailored specifically to your needs. Actually, you can save big on groceries without clipping a single coupon.

Your phone number also feeds into the data collection mine. Cashiers frequently ask for it, and you probably oblige without thinking twice, but it’s just another piece of information used to create a robust customer profile.

Even your smartphone is in on the scheme, as retailers use geofencing — which operates through WiFi or Bluetooth to find out you’re in the store and monitor your movements throughout the aisles. Free WiFi also comes at a cost, as it’s a way for retailers to access your phone and monitor your shopping habits in real time.

What Analytics Are Stores Gathering?

Big datais more than just a way to learn which brand of cereal you prefer. It encompasses both expected and unexpected categories. Grocers and other retails are willing to dig deep to learn as much as possible about you.

When you use your loyalty card to take advantage of store discounts, this tiny piece of plastic shares all kinds of retail analytics with the grocery store. Some of these include which products you’re buying and which ones have dropped from your list, the time of day you shop and the amount of money you’re willing to spend on certain items.

Taking it a step further, some retailers also use loyalty cards to gather information on your income and the size of your household. This data is often used to help stores determine proper levels of inventory, price products appropriately and create enticing promotional offers.

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Can Retail Analytics Be Tracked Without a Loyalty Card?

Let’s say you’re worried about the information your local grocery store is keeping on you and you decide to cancel your loyalty card. That still might not be enough to keep your personal information under wraps. If you read the fine print in your credit card privacy policy, you’ll learn that many major credit card companies collect consumer purchase data, which is sometimes shared or sold.

For example, JPMorgan Chase & Co.’s U.S. Consumer Privacy Notice reveals that certain types of personal information can be collected and shared based on the products or services used. Customer tracking data included consists of Social Security Number and income, account balances and transaction history and credit and payment history.

You might think you’re using your credit card to pay for purchases at the grocery store and beyond, but in many cases, your card is actually using you to collect retail data statistics. Depending on the terms of your credit card, your shopper loyalty card might be significantly less invasive. Plus, you’ll need it for some of these insider grocery-shopping hacks that’ll save you money.

So, Why Do Grocery Store Members Get the Best Deals?

The secret’s out grocery store members have access to the best savings opportunities because they’re trading personal data for discounts. Retail statistics give supermarkets a front-row row seat to your buying habits.

These retail analytics help grocers run a more profitable business, so they don’t want you to ditch the loyalty card. By offering ways to minimize your grocery bill, they’re confident you’ll keep the data flowing.

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