CASPIAN: Consumers Against Supermarket Privacy Invasion and Numbering

Supermarket Privacy News

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Publix ranks #1
Supermarket chain retains top spot on customer satisfaction survey

For the 12th year in a row Publix Supermarkets, a Florida based chain focusing on the southeast U.S. market, has retained the top rating for supermarkets in the American Customer Satisfaction Index (ACSI). With a score of 81 Publix ranked above the category average of 74, and Supervalue come in second with a score of 77. Walmart trailed the category for the second year in a row, with a score of 70.

Publix was also recognized by Fortune for its social responsibility. Ranking 5th overall, the chain was praised for its commitment to its workers and for its charitable giving.

We find it of great interest that one of their largest competitors, Winn-Dixie, continues to struggle since the introduction of their card program while Publix appears to have little problem in keeping their customers "loyal". Perhaps the clean stores, satisfied employees, (who are the only people eligible to own stock in the corporation), and most of all, a card free environment might be something their competitors should consider.


Another one bites the dust
Brown and Cole of Seattle drops card program

A Seattle reader dropped us a note to let us know that local grocer Brown and Cole has decided to drop their dreaded card program. A flyer she picked up in the store reads, in part:

"Over the last year, we have been hearing from more of you that you want a simpler way to save money at our stores that everyone can take advantage of and doesn't require a card. We took this feedback seriously and spent many months developing a plan to change the way we deliver discount pricing to you. We've made the decision to discontinue the S&H greenpoints program.

I'm pleased to announce that we have an exciting new program lined up. We call it Over 1000 Things on Sale. This every day, never-ending sale guarantees that at any given time, and on any given day, there are always over 1000 generously discounted items in our store. These items will change weekly, but there will always be over 1000 things on sale. It is for everyone and doesn't require a card."

In other good news, Sentry Foods, a division of Supervalue located in Wisconsin, has also eliminated their card program based on their own internal survey of card holders. A Sentry spokesperson told industry magazine Progressive Grocer that "the move was taken to make shopping easier for its customers, who no longer have to use the EZ Save frequent shopper card to receive discounts."

We're always please to see when a supermarket decides to listen to their customers and put value and privacy above short term profit. Two down and way too many to go, but your complaints and comments DO work. Keep 'em up!

SOLD, to the highest bidder!
Albertsons' assets sold to CVS, Supervalue and investor group

After announcing late last year that they were searching for a buyer Albertson's has been broken up and sold to three different groups. The total value of the sale was about $17.4 billion in cash, stock and assumed debt. Cerberus Capital Management/Kimco Realty and Supervalue will split the grocery stores, with at least some retaining the Albertsons' name, while CVS picked up about 700 Save-On and Osco locations. No word on if the "preferred" card is going to stick around, but with that price we suspect they are going to use every trick they can to recoup their investment. As to whether the data is safe or might now come up for sale, if I was a "preferred" Albertsons' customer I'd certainly be double checking their privacy policy to see what changes might be in store for the future.

If you were wondering just what the data compiled by their "preferred" card might be worth this information from the sale of prescription data from Winn-Dixie's bankruptcy filing might be of interest. As Winn-Dixie closed some of their stores they sold of the pharmacy records. CVS paid $6.4 million for the records from 62 stores, Eckerd bought the records from 20 stores for $2.7 million, Kroger paid $1.47 million for 12 stores records, Target Corp. purchased nine store records for $1.15 million and Publix bought 11 store records for $1.9 million. The press release stated, almost as an afterthought, that the purchaser also got the remaining inventory. Interesting world we live in when the data is considered more valuable than the remaining products are.

Progressive Grocer (paid archive)

A world divided
Why your shopping history may cost you

We've discussed the issue of customer segmentation before, (here and here), and it appears to be growing momentum. Midwestern grocer Jewel-Osco has introduce their "Avenu" program, where customers scan their card at a kiosk to get specialized discounts. We've heard many times from people who think this is a wonderful development and they will finally get coupons and discounts that they can actually use instead of diaper coupons for childless couples or pet discounts for those that don't own a pet. The supermarkets certainly try to reinforce this idea, but what is going on behind the scenes paints a different picture. Here are a few quotes from within the industry:

"The other way it's useful is that if I have your shopping habits and I know in a category, for instance, that you're a loyal customer of Coca Cola, let's say, then basically, when I advertise Coca Cola to you the discount's going to be different than if I know that you're a somebody that's price sensitive."
Fujitsu representative Vernon Slack explaining how his companies "smart cart" operates.

"The devices can even be set up to advertise based on shoppers' individual buying histories. Coupons or discounts could be offered only to certain shoppers who make buying decisions based on price rather than brand loyalty."
The Deseret News reporting on a smart cart from Fujitsu and Klever Marketing.

"First-time buyers at a retailer could see higher prices than a firm's repeat customers, and retailers may not offer discounts to consumers who buy the same brands regularly without even looking at alternative products on the same site."
Ted Bridis, Associated Press, reporting on a Annenberg Public Policy Center of the University of Pennsylvania study.

"Frequent shopper programs have become so common, that many consumers just expect their store to have such a program," said Hodgins. "Now it's time for more retailers to take their programs to the next level and move from offering every card holder the same discount to using the programs for improved target marketing."
AC Neilson product manager Brad Hodgins discussing their Canadian study on "loyalty" programs

Joseph Turow, a professor at the University of Pennsylvania's Annenberg School for Communication, had this to say about the changing atmosphere in retail shopping:
"The idea used to be that you, the consumer, could shop around, compare goods and prices, and make a smart choice. But now the reverse is also true: The vendor looks at its consumer base, gathers information, and decides whether you are worth pleasing, or whether it can profit from your loyalty and habits."
He goes on to state:
"This all might make sense for retailers. But for the rest of us, it can feel like our simple corner store is turning into a Marrakech bazaar -- except that the merchant has been reading our diary, while we're negotiating blindfolded, behind a curtain, through a translator."

And they are digging far beyond our "diary" and their own store files; companies are supplementing their existing data from outside sources. On the other side of the pond Tesco has data collection down to an art. By using such sources as credit reports and government records, Tesco, in combination with Dunnhumby, (of which Tesco owns 51%), can gain even greater insight into every card holder. And all this data is being made available to outside interests, such as Gillette.

And finally, if you think your "fake" name card is going to allow you to continue to beat the system, think again. Green Hills Farms, a NY state grocer, recently announced plans to introduce a biometric "loyalty" and payment program. Customers will use their fingerprint to access a kiosk with special promotions geared toward each individual. The chain promises that discounts will be offered on things they actually buy, but we'll remain skeptics, especially after reading all of the above.

The Washington Post
The Gaurdian
Progressive Grocer (paid archive)

Privacy policy updated after initial article

In an earlier article we highlighted a few issues we saw with Smart Bargains privacy policy. Soon after that article appeared we went back to take a look at the policy again, and were surprised to find at least one significant change. The section "With whom do we share your information" formerly stated:

"Information about our customers is an important part of our business, and we are not in the business of selling it to others. We share customer information only as described in this policy and with our parent, SmartBargains, Inc. and other subsidiaries controlled by SmartBargains, Inc. that are subject to this Privacy Policy."

It now simply reads:

"We share customer information only as described in this policy and with our parent, SmartBargains, Inc. and other subsidiaries controlled by SmartBargains, Inc. that are subject to this Privacy Policy."

Perhaps they agreed with us that while the statement "not being in the business" may imply they don't sell any information, it certainly doesn't preclude it. In fact, their privacy policy clearly states they will share personal information with others under the section titled "Third Party Marketing Companies";

"Occasionally, we provide our postal mailing list (consisting of customer names and postal mailing addresses, but not e-mail addresses) to other companies whose products we believe may be of interest to you."

We also heard from a reader who called the company to question their policy and request they stop sharing her information. The manager she spoke with initially implied that they only shared personal information with shippers such as UPS, but changed his tune when directed to the relevant portions of their privacy policy. She is waiting to hear what "partners" they have already shared her information with.

Bottom line: just because a business has a privacy policy doesn't mean they are not sharing or selling your private purchase information, and even statements that may at first glance appear to state your information is safe don't always mean so.


Name that... name?
Ebay isn't just for knick knacks

Ebay has become the place to go for people who want to sell themselves, with recent auctions including families attempting to sell the naming rights to their children and a woman who sold her own name. For a high bid of $15,199 the woman, formerly known as Terri Iligan, (at least she doesn't have to use an odd symbol like the artist formerly known as Prince, but now known as Prince again), will now be known as No word from Mrs. GoldenPalace on how she felt when the online gambling house paid almost twice as much for a grilled cheese sandwich with the image of the Virgin Mary on it, ($28,000). What pressing need did she have for selling her very identity? She wanted to send her kids to Tiger Woods golf camp.

This promoted a quick little rewrite of the famous Jim Croce song, "I've got a name", (with apologies to the original writer):

Like the slot machines lining casino floors
I've got a name, I've got a name.
Like the blackjack game from which money pours
I've got a name, I've got a name.
I'm now a shill for a casino
(come on down, and try our Keno)
Selling me down the highway
Selling my name on Ebay
Selling my soul for 15 thousand bucks