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Math Businesses Science

How Companies Learn Your Secrets 354

Posted by Soulskill
from the sit-back-and-wait-for-you-to-tell-them dept.
Hugh Pickens writes "For decades, Target has collected vast amounts of data on every person who regularly walks into one of its stores. Now the NY Times Magazine reports on how companies like Target identify those unique moments in consumers' lives when their shopping habits become particularly flexible and the right advertisement or coupon can cause them to begin spending in new ways. Among life events, none are more important than the arrival of a baby, and new parents are a retailer's holy grail. In 2002, marketers at Target asked statisticians to answer 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?' Specifically, the marketers said they wanted to send specially designed ads to women in their second trimester, which is when most expectant mothers begin buying all sorts of new things, like prenatal vitamins and maternity clothing. 'We knew that if we could identify them in their second trimester, there's a good chance we could capture them for years,' says statistician Andrew Pole. 'As soon as we get them buying diapers from us, they're going to start buying everything else too.' As Pole's computers crawled through the data, he was able to identify about 25 products that, when analyzed together, allowed him to assign each shopper a 'pregnancy prediction' score and he soon had a list of tens of thousands of women who were most likely pregnant. About a year after Pole created his pregnancy-prediction model, a man walked into a Target outside Minneapolis and demanded to see the manager. He was clutching coupons that had been sent to his daughter, and he was angry. 'My daughter got this in the mail!' he said. 'She's still in high school, and you're sending her coupons for baby clothes and cribs? Are you trying to encourage her to get pregnant?' The manager apologized and then called a few days later to apologize again but the father was somewhat abashed. 'It turns out there's been some activities in my house I haven't been completely aware of. She's due in August. I owe you an apology.'"
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How Companies Learn Your Secrets

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  • by idontgno (624372) on Friday February 17, 2012 @03:56PM (#39079107) Journal

    But not terribly surprising.

    Given the opportunity, marketers will be more observant of the goings-on in a household than, say, the father of the house.

    Hell, I am the father of the house, and most stuff that happens catches me by surprise. So I can sympathize with the father mentioned at the end of TFS.

    • by MightyMartian (840721) on Friday February 17, 2012 @03:58PM (#39079153) Journal

      I'm the father of the house, and I came to the conclusion that I don't want to know what's going on in the house. Both kids are in their late teens now, and mutual ignorance seems to be the best way to get along.

      • by Beardo the Bearded (321478) on Friday February 17, 2012 @04:28PM (#39079501)

        Indeed. I've got an eight-year-old daughter. When she was newborn, the older guys in band were saying, "you think you're having sleepless nights now? Wait until she's 16 and dating."

    • by dbc (135354)

      Hell, I am the father of the house, and most stuff that happens catches me by surprise. So I can sympathize with the father mentioned at the end of TFS.

      This man speaks truth.

  • by The Raven (30575) on Friday February 17, 2012 @03:56PM (#39079119) Homepage

    Back when retailers had a more personal connection to their clients, it was also not uncommon for a shopkeeper to notice that a customer was pregnant and stock something specifically for her. Personalization has always existed; this is a more of a comeback than something completely new.

    The flipside is that a shopkeeper also had a personal connection to the mother. Target has no such connection to Customer#9810957065409. This takes the personalization away from 'cozy' toward 'creepy'. It's like the uncanny valley of interactions.

    • by i kan reed (749298) on Friday February 17, 2012 @03:59PM (#39079161) Homepage Journal

      But our marketing blast algorithm is programmed to have feelings and care deeply about you. And to maximize the emotional manipulation on you. It's like having an omniscient psycho ex. What's not to like?

      • by 404 Clue Not Found (763556) * on Friday February 17, 2012 @04:04PM (#39079241)

        Heck, if an omniscient psycho ex offered me discounted, in-stock products I was going to buy anyway, I might just keep them around. That's everything Amazon tries to be already, anyway.

        • Ah, but the entire point of marketing is NOT to save you a buck. It's to get you to burn your buck at the exotic, exclusive, and luxurious, shopping experience that is... wherever the hell they're hocking that day.

          They're paying a team of people to convince you to come into their store rather then no frill's discount bob's shit-bag emporium.

          Remember that marketeers and salesmen don't actually contribute to society. Theirs is a zero-sum game where every dollar they make is a dollar taken away from comp
          • Not totally true. Target wants me to buy my everyday products there, even if it doesn't mean upselling me and getting me out the door with a TV or housewares. Marketing that gets me in the door makes a store happy, even if it's not specifically to get me to buy things I don't need.

          • Saving me a buck helps them, too, if it makes me shop more there. Loss leaders aside, selling things to me at a slightly decreased markup still makes them more money than me going to a separate store.

            The retailers I typically shop with (like Amazon) earn loyalty through some combination of lower prices, superior service, or both, over time. Maybe I'm in the minority, but I'm actually glad they have my entire order history. I just wish their recommendations engine was better.

            In the brick 'n' mortar world, m

      • by EdIII (1114411)

        But our marketing blast algorithm is programmed to have feelings and care deeply about you

        Now that was creepy. I feel like you are going to offer me some cake now.

      • by DeadDecoy (877617)
        Would your algorithm happen to run on GladOS?
    • by MightyMartian (840721) on Friday February 17, 2012 @04:00PM (#39079185) Journal

      It's more like retail stalking.

    • by dbc (135354) on Friday February 17, 2012 @04:06PM (#39079261)

      Funny you should mention that. I grew up in a small town. When my wife and I were married, one of the local retailers was on my wife's gift registry for her china pattern. This retailer knew I had a (relatively, small-town-scale) wealthy aunt who frequented the shop. So the retailer loaded up on all the wacko, high mark-up accessory pieces for my wife's china pattern and every time my aunt came into the store she would get the sales pitch for a soup tureen or something. This went on for years.

      • by Jah-Wren Ryel (80510) on Friday February 17, 2012 @04:55PM (#39079783)

        So the retailer loaded up on all the wacko, high mark-up accessory pieces for my wife's china pattern and every time my aunt came into the store she would get the sales pitch for a soup tureen or something. This went on for years.

        I think that's a great illustration of the problem here - Target and all the other companies that are using "targeted advertising" are going beyond simply providing a service to actively trying to manipulate people. Advertising to inform is good, advertising to convince people spend money on products they wouldn't otherwise purchase is bad.

        • by Born2bwire (977760) on Friday February 17, 2012 @05:11PM (#39079933)

          That isn't what they want to do here. What they want to do is become the prime retailer for a set of products that people start buying at certain stages in their lives. Like how Gillette will send out free razors to people when the turn 18 to try and make them Gillette consumers for their life's supply of shaving products. Target here is trying to predict people who are pregnant and have reached the stage where they are ready to buy the associated baby products and providing incentives for these people to buy the products at Target. Then, the customers will be predisposed to continue buying these products at Target.

          They aren't trying to convince them to buy products they don't need, they are trying to convince them to buy a new range of products that they will need or want to buy from a specific retailer.

    • by subanark (937286)

      Target doesn't need to worry about stocking things for particular individuals. The reason they do this is to offer good discounts to select individuals that are at a crucial point in their life where they "settle down" and adopt store loyalty. These discounts could actually be a loss for the store. Once the customer becomes loyal, there is no reason to offer further discounts.

      The store that has the personal relationship will continue to stock diapers until there are no longer customers who have young childr

  • How to tell they're in the 2nd trimester?

    Track who buys what by Credit Card #. If 3 months after buying a lot of vaseline and thigh highs their buying trends switch towards buying stretch pants and "hot-dogs and ice cream" together... ... and their husband starts buying the vaseline instead... and ear plugs.

    • by tompaulco (629533) on Friday February 17, 2012 @05:20PM (#39080031) Homepage Journal
      Track who buys what by Credit Card #.
      That is a pretty shady area. There are some pretty strict laws about when and how credit card data is to be stored. I don't think brick and mortars are allowed to store CC#s at all. Then there is the matter of tying that information back to an address. Unless you are doing this online, or you willing gave them your address, then there should be no legal way for them to tie a credit card number to an address. Of course, maybe in this case they were using a Target credit card in which case they probably do have the address.
      • by Burning1 (204959)

        Hash the credit card number, associate the hash with the customer ID. Every time a card is swiped, see who's hash it matches. Card number isn't stored. Hash is useless if stolen.

        Combined with a Loyalty card, it's a great way to see who's married to who, since the card minimally gives you the names of the people who are swiping. Names provide geneder information. Purchase history provides information on age, family status, etc.

  • For some reason my girlfriend started getting advertisements and coupons for baby stuff for a while after her sister (in another state) had a baby. Perhaps we tripped some uninformed algorithm with gift purchases, but we gave the free formula to her sister and those have all stopped eventually. The biggest pain was the Highlights subscription we never signed up for, which eventually went to collections (for $25!) after we ignored it.
    • I have a pretty small anecdotal sample group, four sets of sisters, but my experience is sisters of similar age tend to get , or try to get, pregnant around the same time. From what I've observed it's like it's a competition to see who can pop out the first grandchild.

      I think it boils down to younger siblings hate seeing the older ones get everything first. Maybe marketing has picked up on a similar trend.
  • by mfwitten (1906728) on Friday February 17, 2012 @04:07PM (#39079265)

    Coincidentally, the FBI now lists as suspicious activity making purchases with cash.

    • by mosb1000 (710161)

      Yes, but it's harder for them to know when you do it, so it cancels out.

      • by CanHasDIY (1672858) on Friday February 17, 2012 @05:46PM (#39080261) Homepage Journal
        From the FBI's "Communities Against Terrorism" [publicintelligence.net] flyers, under the "What Should I Do?" heading:

        Be part of the solution. - Require valid ID from all new customers.
        - Keep records of purchases.
        - Talk to customers, ask questions, and listen to and observe their responses.
        - Watch for people and actions that are out of place.
        - Make note of suspicious statements, people, and/or vehicles.
        - If something seems wrong, notify law enforcement authorities.

        Yes, but it's harder for them to know when you do it, so it cancels out.

        ... until they convince (or force) all the shopkeeps to do their spying for them...

  • by mounthood (993037) on Friday February 17, 2012 @04:08PM (#39079279)

    Almost all forums have rules against personal attacks [wikipedia.org]. You'd commonly be banned for posting someone else's "IRL" (in real life) information. Yet here we see corporations doing exactly that for nothing more than profit. Data-mining like this is the beginning of an assault on our right to be "secure in our persons" and enjoy privacy.

    • Re: (Score:3, Interesting)

      by keefus_a (567615)
      Except there's a clear defense to this particular assault. It's called cash.
    • by aztektum (170569)

      Yeah, data mining w/o direct consent should be illegal.

      As we better understand the mechanisms of consciousness and the brain and realize this shit it possible, it should also be made illegal.

      it is ridiculous that one could use these to manipulate you into buying more stuff. It goes against much of what the founding fathers of the US were against. An individuals mind must be their own.

      Same goes for the propaganda networks posing as "news" programming on television. It's blatant co-opting of an individuals ow

      • ...it should also be made illegal....It's blatant co-opting of an individuals own faculties.

        I believe your founding fathers would have supported Fox's right to bullshit. You are still the sole guardian of your own mental faculties, you are the only person who can decide what you believe and who you trust. Fortunately bullshit detection is not a genetic trait, it is a skill that can be taught [wikipedia.org]. Self-skepticisim is an essential part of that skill, the simple fact that you recognise you're just as susceptible to bullshit as everyone else already gives you some degree of immunity to it, and it's certa

    • by LordZardoz (155141) on Friday February 17, 2012 @04:48PM (#39079711)

      Lets have a fictional person called Phil (a victim) and Bob (the guy posting the info) for the purpose of this post.

      If Bob posts Phil's name, address, and phone number in a message board without Phil's permission, there is most likely some kind of hostile intent. This usually happens when Phil has managed to make Bob angry for some stupid reason (flame war, abortion debate, maybe Phil is just being a jackass here. Who knows? The reason is not relevant). So Bob gets Phil's info and posts it online in that message board. Why does Bob do this?

      Most likely, Bob is hoping someone will go to Phil's house and beat him up. Or break a few windows. Maybe Bob just wants someone to take a crap in a paper bag, light it on fire, and throw it on Phils porch. The intent is to make it easy for all of Phils enemies to harass or inflict harm on Phil.

      Target or Walmart do not have any hostile intent. They just want to sell you stuff. They gather and analyze data, and the only objective harm thaty they would intentionally cause is filling your mail box with unwanted spam. I would agree that doing so should earn someone a kick in the nuts anyway, but it is only annoying, not dangerous. In many cases they are using info they gathered themselves for their own benefit. It could also be argued that what they are doing is of mutual benefit: Walmart gets Phil to buy stuff, Phil will have a chance to buy something he wants.

      The only problem for Phil is when access to that data is then sold, shared , or illegally accessed by those whose interests may run against him. There needs to be legal protections in place for Phil, and Walmart needs to be held responsible for any harm that comes of them keeping that database.

      END COMMUNICATION

      • Target or Walmart do not have any hostile intent. They just want to sell you stuff.

        Yeah, buts let's just parse out the term "sell" a bit. They want you give them the maximum amount of your money in exchange for the least amount of value. Its not about finding out what you need/want, because they could just ask you that. Its about manipulating your perception of your own desires so that you "want" to buy as much as possible of the highest margin possible goods.

        Not hostile?

    • by guspasho (941623)

      I'm not sure I understand your post. Are you saying the ads were a personal attack?

  • Good Data is just that.. and it can make solid predictions. It's clear transparency is good for markets (e.g., stock markets, Etc.) but is it good for people? My own take is data mining and tracking isn't evil; if you do business with a company you should assume, for better or worse, that they will try to understand and learn about you. If you don't wish that to happen, you need to pay in cash, not give them your zip code and avoid reward clubs, etc.

  • Female customers who have recently 1) purchased a pregnancy test kit, 2) stopped buying tampons, and 3) purchased morning sickness remedies such as Saltine crackers.
  • So they are analizing what kind of products a customer buys, and if they are products associated with pregnancy then they market them even more products associated with pregnancy. Seems like that without all that funny little anecdotes about pregnancy prediction, this is just the same algorithm everyone else uses: offering a customer the types of products they have bought in the past. Also, a pregnant woman in the second trimester is quite easy to detect by the good old method of looking at her.

  • Better at noticing your kid isn't just fat than you are!
  • by SmallFurryCreature (593017) on Friday February 17, 2012 @04:27PM (#39079493) Journal

    People often forget there client card at my super market (AH) and I happily lend them mine. Must give them some interesting stats.

    The problem is that marketeers really think this matter. Lets examine this particular case for just how idiotic it is.

    Target profiles its EXISTING customers to be able to bombard them with coupons for products these same customers already pass everyday... Can win these customers for live? YOU ALREADY GOT THEM! And now instead of them buying the products they already seen at full price, you are reducing the price for no good reason.

    TV shows just how desperate marketeers are to prove they matter, the program you are watching interrupted by ads, for the program you were trying to watch followed by overlays of the next program, so please stay tuned... I would if you didn't ruin the program with all this begging. It is like going to a restaurant and having the chef come over after every bite to ask if you are enjoying yourself.

    Marketing doesn't sell products, marketing sells marketing. I am not saying ads don't work but rather that the constant overloading of ads, does not work. Check this for yourself, if an adblock takes longer then it used to, do you continue watching? Once ads were singular, to short to flick away. But the "going to the toilet" during the advertising is now a way of life and has been for decades. And here poor advertisers are trying to sell their products to viewers who are studying their toilet door.

    Myself? I barely bother with TV anymore. If for some masochistic reason I want to see what happens, I download it and get rid of ads altogether. I have ad block installed and ghostery. NOT because I mind being tracked so much but because I just can't stand the interuptions and delays that slow ads and scripts cause.

    This Target campaign targets existing customers into buy stuff they have to buy anyway and ignores new customers altogether... BRILLIANT. I know how effective it is, some marketeers and statisticians got payed big bugs. Mission accomplished. Any actual new customers that make up for the costs and potential lawsuits? (Oh you just wait till they get it wrong or target a woman who had an abortion, or didn't want her family to know or had a miscarriage).

    • by brainzach (2032950) on Friday February 17, 2012 @04:46PM (#39079693)

      The marketing campaign tries to get customers to buy new different products based on their past purchases. They want to identify pregnant women so they can encourage them to buy products at Target once they have a baby, instead of the customer shopping at a competitor for their baby needs.

      Target figured out that people change their shopping habits the most when they had a baby, so it provides them with the biggest opportunity to win over customers. Knowing that someone is pregnant is marketing gold. The methods are based of research and the evidence is supported in Target's sales. It isn't just a bunch of BS.

    • If for some masochistic reason I want to see what happens, I download it and get rid of ads altogether.

      I too believe that watching television is an incredibly painful experience. But there is some good content out there, and I pay Netflix $8 a month to watch it ad-free. I seriously think Netflix is easier and more convenient than TPB. Eventually, I suspect that significant price hikes and/or advertisements will make their way into Netflix, but until that happens I think Netflix is superior.

    • by Bardwick (696376)
      It's usually not the store that does it (alone). I worked data storage for a company that pulls customer buying information from grocery stores, retail outlets, large financial institutions, well, just about from everyone. Major banks foward them your credit card sweeps about the same time it shows up on your online statement. Last I was there, roughly three years ago, they had 87 ASSUMED data fields on over 30 million consumers, which were extrememly accurate. 12 employees to support a 7 TB oracle RAC.
  • Absolutely detestable. And common. This type of thing is precisely why I take great pains to avoid being tracked, online and off. Pay cash, don't use affinity cards, block all online ads, javascript, etc., and avoid doing business with companies that use these types of methods.

    • I'm not sure that targeted advertisement really bothers me that much. I have to say, my ads in GMail have been spot on more than a few times. Compared to the mind-numbing mass-appeal aim of television advertising, I guess that targeted ads really don't bother me that much.
    • by the gnat (153162)

      Absolutely detestable.

      Why is this detestable? "Detestable" is Comcast sending me mail at least once a week for the last three years, despite the fact that I don't watch TV, have no use for their services, and have never responded to anything they sent. Or American Express checking my credit rating nearly ten times in the space of a few years, and bombarding me with credit card offers. I already have two cards, assholes, and that's at least one more than I need. If I call a girl twice and she doesn't cal

  • by Tony Isaac (1301187) on Friday February 17, 2012 @04:32PM (#39079543) Homepage

    Maybe this is what AARP has been doing. They've been sending me invitations to join their organization for years, ever since I was in my 20's. Undoubtedly their data mining algorithms determined that I would one day reach retirement age, so they are doing everything they can to "capture" me now!

    • Re:AARP (Score:5, Funny)

      by tompaulco (629533) on Friday February 17, 2012 @05:25PM (#39080075) Homepage Journal
      Maybe this is what AARP has been doing. They've been sending me invitations to join their organization for years, ever since I was in my 20's. Undoubtedly their data mining algorithms determined that I would one day reach retirement age, so they are doing everything they can to "capture" me now!
      I, on the other hand, at age 41, have not been contacted by AARP. This probably means that their data mining algorithms have determined that I will NOT reach retirement age.
  • by HideyoshiJP (1392619) on Friday February 17, 2012 @04:32PM (#39079553)
    I'm a rather young man and I only seem to get things in the mail from the AARP, AAA and Medicare Providers. Maybe it was that sweatervest I bought.
  • Walmart (Score:5, Funny)

    by Tony Isaac (1301187) on Friday February 17, 2012 @04:34PM (#39079569) Homepage

    I'm convinced that Walmart does this kind of data mining too. As soon as I walk into the store, their computer systems identify me, figure out what I'm about to buy, and make SURE that item is already sold out!

  • ... even if she didn't (herself) know that she was pregnant! I thought maybe Target had pheromone/hormone sniffers or hidden ultra-sound scanners.

    Now THAT would be creepy!

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