Where to start on this one. First of all many thanks to those who have emailed, tweeted and G+’d me to the hilt with the link to the original article on how Target correctly found out how a girl was pregnant before her father did.
I think it’s worth clearing up one thing. The whole crux of the article isn’t about highlighting the woes of privacy in supermarket basket data, oh no, it was really a clip from a segment in Charles Duhigg’s forthcoming book.
The key point to this whole Target thing was missed. While the bloggerati and marketing gurus of the world wet themselves with issues of privacy, the way forward and what to do NOT to give that sort of data so Target could figure out what you wanted…. well they all missed one key point.
Andrew Pole had just started working as a statistician for Target in 2002, when two colleagues from the marketing department stopped by his desk to ask an odd question: “If we wanted to figure out if a customer is pregnant, even if she didn’t want us to know, can you do that? ”
Let me just highlight that bit for you again.
So an article in the year of our skeptic 2012 is getting het up about something dated 10 years ago. Go internet go!.
All that aside….
Basket analysis is not done by all supermarkets. If you have a Tesco Clubcard then you’re with the daddy of them all. Your basket behaviour is monitored if it’s worth monitoring. While all data may be warehoused not all data would be mined.
Now finding patterns in data is quite easy and something that Datasentiment does (we can do the real time stuff too if you want).
Is there a privacy issue of gaining insight? No not really, you opted in for communication from the retailer, no? So why be surprised when the responses are tuned to your likes? Tesco know a lot about you, more than some government departments and it’s about loyalty and profit. It’s a calculated equation to get you back instore. And if a retailer understands their customer then there’s good chance that the customer will return.
For this year, 2012, with the amount of shop closures, the rise in the cost of living and general trading conditions – knowing thy customer just became the top issue. Not dropping prices, not mad Groupon like promotions but calculating what really matters the customer.
Target got it right a long time ago and Tesco got it right a long time before.
So as a retailer when are you going to try? Here’s a starting point for you….