Cool or Creepy? Supermarkets Use Customer Data to Offer Custom Bargains

According to the New York Times, supermarkets are mining your personal data to offer you customized discounts -- or raise your grocery bill

Supermarket loyalty cards have become as much a part of the grocery shopping experience as "paper or plastic," but most of us think of the cards as a modern alternative to coupon clipping. The New York Times reports that major grocery chains are using the customer data collected through these cards to take offers and discounts a step further.

Instead of offering everyone the same discounts, retailers are offering targeted discounts (or price increases) based on information like specific brand-name items you typically buy, when you buy certain items and whether you have children. According to the Times, retailers may offer discounts on a large box of Tide detergent if they know you have a large family, or even entice you to buy an expensive item if your shopping habits show that you don't pay much attention to prices.

Supermarkets are using various tactics to take advantage of this consumer data. Stop & Shop's Ahold division offers an app that shoppers can use to scan products and instantly recieve e-coupons. Kroger sends personalized coupons to customers in the mail. Laura Jennie Sanford, a blogger who tested Safeway's new pricing program, was sent offers for Kashi products and bagged lettuce, reflecting the health-conscious items that usually go in her shopping cart. While Safeway is not adjusting prices based on shopping habits, the retailer says it may do so in the future.

If deemed a success, more stores may abandon standardized prices and instead rely on customer data to offer custom prices for each shopper. The question is whether shoppers care more about their personal information or getting a good deal.

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