Your credit card friend

Your online shopping is aided by a number of imaginary friends. By now you’re probably getting used to their advice. You know, there is the artsy friend, the one who always knows what music or books you like. On iTunes you call him a genius (and he makes great playlists). On Amazon, she’s in tune with lots of people similar to you. But these ‘friends’ – while useful – can be so one-dimensional!

How come my ‘genius’ friend who is so good with music, can’t recommend a book for me? Would it be that much of a leap for these two friends to talk to each other? Perhaps if he’s such a ‘genius,’ he could tell me what movies I might like based on the music I listen to, or what TV shows I might like based on the books I read …

Whoa – kind of mind-blowing, right?

In fact, it’s easy to imagine that with enough data, and enough overlap in consumer patterns, it would be possible to use consumer preference algorithms to do exactly what I’ve proposed above. If such a system were good enough, it too might be a welcome friend like the ones that already provide helpful, yet not too pushy, shopping advice. And who doesn’t love a good personal shopping assistant?

But who has all the data to accomplish this genius plan? What entity knows where you buy everything and could be capable of offering such a service? I can only think of one.

If you ever look at your credit card statement and try to figure out what you actually bought, it can be tough. At best you’ll get the total, company, and location. This isn’t quite enough for the detail this plan would need, but the stores still have the detail. For example, if you have a customer card for CVS or the grocery store, the store can actually track every individual item you purchase in a year. And as more and more stores institute these customer cards, it becomes easier and easier to collect the information. It wouldn’t be unreasonable for them to share this data with your credit card company for the purposes of an integrated service, would it?

Right about know I’m sure you’re cringing in terror at the idea of such a massive infringement on your personal privacy. Relax – there is no such thing. Credit card companies already know everything about you.

Let’s take a quick look at why different retailers would want to buy into a system where they shared information with the credit card companies. If only they thought it would bring in more business…

Here’s how:

-We already talked about music & book recommendation systems… iTunes could promote Amazon and Amazon could promote iTunes – a win-win situation?

– What about restaurants? Something like, “People who spent more than $50 dollars at the flaming wok also spent $50+ at sugar and spice.”

– Or maybe, “We see you just bought $200 worth of snowboard gear, if you buy a season pass at Spoon Mountain right now, you can get $20 off your next purchase of $100.”

There are simple connections that can be made across product categories. You’ll likely think of 5 more before the end of your next meal.

Now, it’s important to address all those criticisms you have. At some point in reading this if you’re a stick in the mud, or at least a good critical thinker, you may have put up one of the following “new idea brain defense mechanisms:”

–         It’s already being done: yeah, ok my grocery store gives me coupons sometimes. That’s not really across categories though, the store is still only promoting itself. And those credit card ads with your bill? I guess, but you probably don’t pay attention to them because they aren’t well targeted.

–         It’s not worth doing: Up to you to decide. I think as advertising gets more and more difficult through “traditional means,” companies will increasingly look for super-targeted “service-based” advertising. Which is the idea that “I’m not selling you something, I’m making you aware of something you probably want to buy.”

–         It’s impossible: Clearly not impossible, but it would require a lot of work and a pretty vast network of connections. Good thing the credit card companies already deal directly with all retailers, information transfer is easy, and it’s their job to track consumer information. You know how they call you up when your purchases look suspicious? Big brother is just trying to look out for you!


About livingthememe

engineer and armchair philosopher
This entry was posted in how we buy, internet and tagged , . Bookmark the permalink.

2 Responses to Your credit card friend

  1. MBD says:

    Without a unified platform it will never work like you/I would want it to. Meaning:
    -Companies aren’t going to share consumer information with each other
    -There are many different credit card companies
    -Many people have multiple credit cards which won’t be communicating through each other, and may use different cards for different things

    I think the key will be an opt-in service (like google checkout) where you give them your information and buy things through them, and they track all this.

    Companies won’t share is my point, they are in competition and consumer trend info is their biggest one-up factor.

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