Playing the Privacy Card

It seemed like such a great idea at the time. On Nov. 17, we reported that mall owner Forest City had hatched this innovative plan to monitor shopping patterns at two of its shopping centers by tracking patrons’ cell phones during the holiday 2011 season, beginning Black Friday.

Forest City, based in Cleveland, was quick to point out that all derived info would be anonymous, as a means to head off potential concerns about privacy. No such luck. Less than two weeks after the initial announcement, Forest City had to pull the plug, at least for the time being, after U.S. Senator (N.Y.) Charles Schumer phoned Forest City over Thanksgiving weekend to take issue with privacy invasion.

The problem wasn’t so much about the tracking – it was more about the ability for shoppers at Promenade Temecula (Calif.) and Short Pump Town Center in Richmond, Va., to opt in, or out, of the survey. FootPath technology used antennas set up around the shopping centers to anonymously track shoppers as they moved from store to store. Customers were notified of the survey via in-mall signage, and the only way for them to opt out was to turn their phones off.

Schumer protested that the malls should have given shoppers the choice to opt-in. "A shopper's personal cell phone should not be used by a third party as a tracking device by retailers who are seeking to determine holiday shopping patterns," he said in a Sunday press conference. "Personal cell phones are just that -- personal. If retailers want to tap into your phone to see what your shopping patterns are, they can ask you for your permission to do so."

So Forest City Commercial Management, the management arm of Forest City, has returned to the drawing boards to devise a way for consumers to opt out. "We have temporarily suspended further trial of the technology while we work with the system developer on possible enhancements, and in deference to concerns raised by Senator Schumer," the company said. "We look forward to meeting with the senator and his staff, together with the system developer, to further explore his concerns."

Originally the tracking was to continue from Black Friday all the way to New Year’s Day. Now it’s unknown when it can resume. And the technology manufacturer – Path Intelligence, out of the United Kingdom – is speaking out. According to Sharon Biggar, its CEO, this kind of technology is used all the time. Online retailers, she said, track customer movements digitally without any kind of notification or opt-in/opt-out. The mall program is simply a bricks-and-mortar iteration of the same type of technology, she said.

I can understand Schumer’s concerns that, despite measures taken to protect personal data and identities, seasoned hackers could perhaps gain access.  But it seems unlikely. And, in fact, according to Biggar, the technology is currently being used in Europe and Australia, and J.C. Penney and Home Depot have toyed with using it here in the states. I, for one, am anticipating Forest City’s next move, hoping that the company can blaze a path toward an accepted platform for gathering retail shopping data that would prove invaluable to all of us in the industry.

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