Loyalty cards: Extra savings or invasion of privacy?

Last week's column about loading e-coupons to loyalty cards led to — what else? — lots of reader comments about store loyalty cards!

Whether they love them or loathe them, my readers are chiming in. Several were concerned about privacy.

Dear Jill,

I have a shopper's card that you can load e-coupons to. I don't have a problem with e-coupons, but I do wonder what kind of information the store tracks.

I'm sure there's a list somewhere of the items I frequently purchase since my store sometimes gives me e-coupons for things I bought before.

Should I be worried about privacy? — Rose H.

Dear Jill,

My husband hates the idea of using a store card to get a better price. He says the store is keeping track of what we buy.

But I think it's silly to pay more in order to prevent a retailer from keeping a list of what I'm buying. Who's right? — Lora S.

Dear Rose and Lora,

If you use a loyalty card at the supermarket or drugstore, there will be a list of everything you've bought.

Stores call this "data mining," and they use the information they garner from your shopping habits in several ways. In addition to providing ongoing information about what shoppers buy most frequently, the data can also help plan future promotional offers.

If your store has a Catalina coupon printer, you may have noticed the coupons that print at checkout are often based on your past purchases. If you buy a box of cereal, it may trigger more coupons for cereal, and so on. This data is often tied to your store's loyalty card. But not always.

While I understand that many people are concerned about privacy, and some may find the idea of data mining unsettling, stores can still track your purchase history even if you don't use a loyalty card. Many stores, including Walgreens and Target, tie purchase history to the credit card you use to pay, not your loyalty card.

In fact, Target's data management is so thorough, its predictive analytics department can identify what kind of shopper you are and what might be going on in your life by looking at your purchase patterns. The New York Times ran a fascinating article about Target's ability to determine if a customer is pregnant by watching for a specific sequence of purchased items.

And it isn't just diapers or formula; the list includes lotion, washcloths and cotton balls. The data was so sound that Target could even tell what trimester the shopper was in based on what she bought, all without a loyalty card.

According to an example in the article, Target almost got in trouble when it sent coupons for baby clothing and cribs to a shopper's residence.

The shopper was a teenage girl, and the girl's father angrily confronted Target about sending baby-themed mailers to a teen. A few days later, the father apologized to Target. His daughter was indeed pregnant, she just hadn't told him yet. Because she bought items from Target's "trigger" list, she inadvertently indicated that she was in the early stages of pregnancy.

So where does this leave us? If you don't want your purchases tracked, you should forego using a loyalty card and pay cash for every item, at every store. But for shoppers who are loyal to their loyalty cards, consider the upside: Because the store knows what you're buying, you might receive promotional offers and coupons you might not know about otherwise.

Jill Cataldo, a coupon workshop instructor, writer and mother of three, never passes up a good deal. Learn more about couponing at her website, http://www.jillcataldo.com. Email your own couponing victories and questions to jill@ctwfeatures.com.

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