"I Know What You Want for Christmas, Darling." That's not a title of a new movie or a new song that will be released this holiday season but that can be the motto of marketers who use technology to know what the market wants. As consumers use websites and mobile apps to find great bargains, marketers have also found a way to connect the dots and hit the spot when it comes to targeting consumers with products that they cannot resist.
Big data that consist of zip codes, income, geographic location, employment, and other information are being used by retailers to know what to put on their shelves and what price can be afforded by the market.
"You can't have Christmas any more without big data and marketers. You know that song where Santa knows when you've been sleeping? He knows when you're awake? Believe me, that's where he's getting his information from," said executive director of Center for Digital Democracy Jeff Chester in an interview with Bloomberg Businessweek.
Marketers use data collected online and offline to create a profile of shoppers. Shoppers often agree to offer some information in exchange for better deals. In some retail stores such as Target, Wi-Fi and mobile apps play a big role in monitoring online activities of customers as well as offering them coupons to convince that the store's offering is better than other stores.
Other big holiday retailers such as Best Buy, JCPenney, and Macy's have partnered with Shopkick, a mobile app that they can use while in store to receive perks and special offers. There is also Snapette, another mobile app specifically designed to track the location of women who love to shop for fashion goodies, that provides a good idea what fashion products click with consumers.
While most technologies ask for the shopper's permission, a motion technology device called Shopperception taps the same functionality of the Xbox Kinect to see how customers go about their shopping from one aisle to another. It sees whether customers are picking up products from shelves and just returning them or what aisles attract most buyers. The technology can also trigger digital signs around the store and offer coupons to promote some products inside the store.
"There are lots of potential uses of information that are not revealed to consumers," said Susan Grant, director of consumer protection at the Consumer Federation of America.
"...consumers still need to do quite a bit of shopping to make sure that they get (what) meets their needs the best and is the best price," she added.
According to authorities, existing laws are way behind in terms of how technologies evolve to make use of consumer data. Data brokers that buy, collect, and sell consumer information are being investigated by the Federal Trade Commission.