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| Jul 29, 2010 - 06:37 PM |
Queen City News - Helena's FREE Weekly Newspaper |
Helena, Montana |
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When Albertsons introduced its Preferred Savings Card in Montana on June 26, a privacy rights group wasn't far behind.
While most people may see the savings cards, now common in most major grocery chains, as a minor inconvenience at worst, others see something far more ominous.
Katherine Albrecht, founder of Consumers Against Supermarket Privacy Invasion and Numbering (CASPIAN), foresees a nightmare scenario: a day not too far off when grocery stores monitor your every move, even facial expressions, and instantly adjust prices to match your income and habits.
The technology already exists, Albrecht said in a telephone interview, and she has held a prototype in her hand. But even setting aside such Orwellian prospects, her group maintains that the discount cards really provide no discount at all, that they are used to drive out low-income shoppers and gather private information about shopping habits that is open to a wide range of abuses.
The web-based organization (www.nocards.org) claims members in all 50 states. Interest in Montana has been on the rise since Albertsons introduced the cards all at once in seven Western states.
An electrical engineer in Billings who asked not to be identified said that he switched his shopping loyalty from Albertsons to Evergreen IGA after the savings cards were introduced. The IGA store bears a sign stating, "You don't need a card to save."
"I'm pretty much a big privacy advocate," the engineer said. "I think people are just willing to give away private information without considering the consequences." He said he found CASPIAN by searching the Internet for more information about the issue.
A spokeswoman for Boise-based Albertsons said that the grocery chain requests the minimum information possible: name and mailing address, with optional listings for home telephone number and email address.
"We are absolutely committed to maintaining our customers' privacy," said Jeannette Duwe.
But the application form examined by The Outpost also asks for gender and doesn't make it clear that the phone number and email address are optional.
In any case, customers who object to surrendering even that much personal information are finding their options increasingly limited. Grocery store chains have continued to consolidate, and the drive for more sophisticated consumer information has increased.
Nationwide, about 70 percent of grocery stores use the cards, Albrecht said, and the number is rapidly headed toward 90 percent or more. In Billings, Smith's grocery stores have used shopping cards since their opening. County Market recently instituted the Greenpoints program, which uses a card to accumulate points toward discounted prices.
Prices can be sharply higher for shoppers without cards. An informal Outpost survey of Smith's and Albertsons stores found that prices without the cards were as much as 50 percent higher on selected items. However, many store items aren't affected by the discounts.
On those that were, prices typically were 25 percent to 33 percent higher for those without cards. For example, a bottle of Finesse shampoo at Smith's cost $3.99 without a card. Those with a card paid $1 less.
Tomatoes that cost $1.99 at Albertsons sold for 70 cents less to those with the Preferred Savings Card, a 35-percent savings.
In addition to lower prices, card holders can earn up to 5 percent back on purchases for college and receive coupons when cumulative spending hits $250.
It was a big move for Albertsons, which used to pride itself on not requiring cards to obtain discounted prices.
"At one time that was our strategy," Duwe said. "As our company looks for ways to grow, we are going to continue to evaluate strategies we've used in the past."
Why cards? "It helps us to become a better marketer," Duwe said. Grocery stores have large, perishable inventories and notoriously low profit margins, so even small changes in product mix and buying habits can make large differences in profitability.
Duwe rejects the notion that the information will be used to adjust the product mix so as to drive out less affluent and less profitable customers. "We are not encouraging anybody to stop shopping in our stores," she said.
Except, maybe, for privacy advocates. Although County Market, Smith's and Albertsons all emphasize their privacy policies. "We will not sell or give your personal information for use by any outside parties," the Albertsons application says. Albrecht and other critics aren't convinced.
One study found that only 19 percent of financial institutions abided by their own privacy policies, Albrecht said. Among retailers, the percentage probably is lower, the study's author concluded. "The privacy policy is about as valuable as a piece of toilet paper," she said.
In an article prepared for the Denver Law Review, Albrecht outlined a grocery list of real and potential abuses of information gathered by grocery stores. Among them:
- Grocery shopping information turned over to federal intelligence agencies in the wake of Sept. 11 to help identify people with Middle Eastern diets.
- A grocery store that threatened to use information about a man's alcohol purchases to defend itself in a "slip and fall" case.
- Health-maintenance organizations using dietary information to determine insurability.
- Subpoenas to turn over grocery stores records in alimony cases to determine whether income reports are accurate.
- A proposal before the National Institute of Health to use dietary information to target specific groups of people in an attempt to approve their health habits.
- Suspected marijuana dealers whose grocery records are checked for Baggie purchases.
Scary as some of that might sound, Albrecht foresees even worse: the next generation of shopping cards that track cart movements and customers' buying habits. A "price insensitive shopper" like her, with little time to spare and small children at home, might have to pay $4 for a $2 jar of peanut butter, she said. An empty nester who rarely buys peanut butter may pass the aisle minutes later and be offered the same jar for $1.89.
Such scenarios may sound far away, but seven U.S. supermarkets already are using customer fingerprints to monitor purchases, according to a recent article in Harper's magazine. And resistance to the potential invasion of privacy may be growing, at least in some circles.
A recent survey by Weber State University found that most customers thought they should get discounted prices whether or not they had shopping cards. Many people apparently believe that the cards don't offer true discounts; they simply allow customers to obtain the sales prices that previously might have been available without cards.
Albrecht said she is concerned that the cards place elderly and disabled customers at the greatest disadvantage. They may not be savvy enough to apply for the cards, and may be unable to travel to other stores if they object to surrendering private information.
When Albertsons introduced its Preferred Savings Card in Texas earlier this year, about 40 people turned out to protest at an Irving store.
Albrecht thinks that Albertsons learned from that experience to take a low-key approach. When cards were introduced in June in Montana and neighboring states, CASPIAN sent out 100 news releases to major media outlets in the region, Albrecht said. Only one, an Idaho newspaper, asked for an interview, and the story that finally appeared didn't mention CASPIAN, she said.
In Billings, Albertsons helped smooth the introduction of the program by donating $100,000 on July 22 to four Western affiliates of the Susan G. Komen Breast Cancer Foundation. The donation was based on 25 cents for every Albertsons customer who signed up for and used the Preferred Savings Card within the first two weeks of the card launch.
Such gestures didn't satisfy the Billings engineer. "I'd rather pay cheaper food prices" and use the savings to make his own choices about what charities to support, he said.
Albrecht's cause may seem like a lonely one. The New Hampshire woman has plenty of other things to do: she has small children, teaches school and is working on a doctorate in consumer pricing psychology. Yet she has devoted herself to the CASPIAN cause with so much zeal that she felt obligated to offer an explanation on the website for her activism.
"We are most effective when we follow our passions, temperament, and talents to work on the causes that stir us, not when we sacrifice ourselves in the service of causes that don't," she wrote. "My passion happens to be preserving personal freedom, staving off totalitarianism, and resisting Orwellian intrusions."
And nothing hits closer to home than groceries, she said. Everybody eats, and your diet goes to the heart of your health, your family, and your life.
Kristina Courtnage contributed to this report.
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The Queen City News is published every Wednesday in Helena, MT, by Mossback Media, LLC.
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