How retailers track your spending habits and what you can do about it

If you sometimes feel like you’re being watched by retailers, you’re probably right. These days companies have countless ways of tracking the spending habits and consumer behavior of the public, and most of the time people don’t even realize they’re being tracked.

Although some of these strategies can actually provide benefits to consumers, if you’re concerned about your privacy then there are still things you can do to reduce the data you provide to retailers.

Loyalty Programs

Using your loyalty card at multiple retail outlets leaves a trail that the company running the program can use to gather a considerable amount of data about your spending habits.

Loyalty cards give companies cold hard data about what you spend your money on. But more so, it allows them to form a profile of your preferences and spending habits.

When you consider that a loyalty program might have anywhere from tens of thousands up to many millions of active members, it’s easy to see the power and depth of the consumer behavior data that is being constantly sent to the companies who run these programs.

One of the big benefits for marketers who track consumers through loyalty programs is the potential future ability to target them with specific advertising campaigns or offers that match their interests. And because most people rarely read the terms and conditions or privacy statements connected with loyalty programs, many don’t realize that their data may sometimes be legally allowed to be sold on to third party companies.

Using trackable information from customer loyalty programs lets a merchant gain a good understanding of consumer behavior which can then be used for future marketing purposes or even to sell to third party marketing firms.

So how can you reduce the risk of your data and speeding habits being tracked via this method?

The logical choice would be to avoid all loyalty programs. But since there can be benefits involved with using them, this isn’t always a desired option. The best strategy is to minimize the number of loyalty programs you contribute to, and always read the terms and condition to find out if your data is allowed to be sold on to outside marketing or other companies.

The most trusted loyalty programs are those which clearly state that they will never sell your information.

Website Tracking

Using cookies (small text files stored on your computer by websites), online stores and any other websites can track what actions visitors are taking on their site.

More advanced functions of cookies can include customizing the pricing of products on a website based on your usage: if you’re a first time visitor you might see a different price to when you later return to the same site.

If you add some items to a shopping cart but don’t complete the checkout, an e-commerce retailer might have an eye catching notice on the website next time you visit, enticing you to finish purchasing and possibly offering incentives for you to do so.

Can you block cookies?
Yes, it’s possible to block cookies by selection this option in your browser’s privacy settings. But there’s a downside to blocking cookies: some functionality of the website may not work as intended, such as keeping you logged in, remembering your preferences, or allowing you to complete a shopping cart checkout.

So despite the tracking ability of cookies, most users find that any downsides of keeping them enabled usually outweigh the disadvantages of disabling browser cookies.

Social Media & Online Data Collection

Social media has provided the biggest collection of consumer data ever known. And it’s all voluntarily submitted by users; often without them even thinking about it.

The more personal details and information that is made public on a social media account and other sites, the easier it is for retailers to specifically target products and services to certain demographics and users based on their online behavior and statistics.

Advertising can be marketed to people based on their location, relationship status, age, gender, interests, hobbies, education, job, whether they have children or not; the list goes on. The more data people make available in their social media accounts, the easier it is for marketers to track and target them in a very specific and sometimes personal way.

How can you avoid this?

Minimize the amount of personal information provided in social media accounts, and ensure all privacy settings are set at their maximum. People who maintain mostly public social media accounts and who submit a lot of personal information provide a wealth of data for retailers and marketers.

How can you reduce the personal data that retailers gather from you?

Although technology has made personal data collection easier and more widespread than ever, some things never change when it comes to protecting your own privacy. Simple, basic measures can help you minimize the amount of personal information that you make available to advertisers, corporations and marketers.

– Minimize or eliminate the use of loyalty cards (consider the downsides of doing this though)

– Reduce the amount of personal information you provide on social media accounts

– Only shop in physical retail stores using cash; avoid online shopping (again, an extreme measure to take to ensure total privacy).

– Learn how to allow web browser cookies only from trusted sources.

Clearly some of these actions would be considered drastic or disruptive for some people. It really comes down to just how private you want your information and spending habits to be, and how much flexibility and convenience you’re willing to give up to achieve that.

By taking more care in the information you divulge and the programs and websites you sign up for, you can have greater control than you might think about how much personal data you are sharing with advertisers, and how much of your spending habits retailers, companies, websites, data centers and other marketing organizations can gather, use and sell.

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