With the Shopkick app, the retailer will know who individual shoppers are and can communicate "when you need it, and how you want it," says Rick Rommel, Best Buy's senior vice president of new business. With the proliferation of smartphones, "there is a tidal wave here that we need to be a part of," he says.
By summer, Shopkick will begin exploiting Internet-equipped smart phones and their location-sensing abilities by using it to provide information to retailers. If customers use their iPhone or Android handsets, which are equipped with tiny cameras to read barcodes so customers can comparison shop in-store, that store also has access to that person's information -- it's only fair, after all. If your smartphone comes equipped with the latest in geolocation apps then the store will also be able to know where your smartphone (and you) are.
According to Venturebeat, this is called geofencing, or establishing a virtual perimeter around a location - usually around a business, restaurant or store. When those with smartphones step into that perimeter, their phones can be contacted and filled with information on specials or deals. Because the technology is so new and still kind of conceptual for most people, most may not understand the enormity of it or the potential lack of personal privacy.
"We need to get clearer rules of the road that protects privacy by default," said Peter Eckersley, senior staff technologist for the Electronic Frontier Foundation in San Francisco, a nonprofit that defends both digital privacy and consumer rights. "Consumers have to understand and have consented to [smartphone tracking] and not have it be buried in the fine print."
Eckersley said that the state of privacy in emerging technology seems to be weighted towards businesses rather than the individual. A simple one-click "I agree" can have someone agree to five pages of legalese that may include data caching or third parties starting long-term files on individuals. Not having seen Shopkick or any of the stores' user agreements, Eckersley can't speak directly on the subject but does say that any "I agree" box-clicks tend to be legally binding. He suggested using caution when agreeing to the use of localization tools because third parties can gain access.
"The primary way for getting paid is through advertising, and advertisers are looking for more ways to collect information about people," he said. "Know that if you carry a location-enabled device . . . that it could potentially be available to people with interests that are different than yours."
Your location data could be subpoenaed for trial or stalkers could gain access to information through lax company procedures, he said. "These are fundamentally sophisticated surveillance tools."
For stores like Macy's, Shopkick means keeping tabs on previous customers as well as providing rewards, coupons or other incentives to lure them inside if they happen to be in the neighborhood. Other companies, like the social-mapping Loopt, Foursquare, and Gowalla, also seem to be looking into cashing in on the location-sharing abilities. (It's rumored that Yahoo! may try to purchase Foursquare.)
While these companies would say that they are merely notifying you of nearby deals, I'm not sure the trade-off of privacy for a coupon is worth it for me. However, for younger generations who have grown up on MySpace, YouTube and Facebook, this may not be a problem. They are comfortable telling the world where they are and what they are doing. For them, the biggest hurdle might be one of the first plagues of the Internet -- spam.
"The last thing people want is somebody calling them, trying to sell something," explains Tasso Roumeliotis, CEO of WaveMarket, a company providing geofencing services to application developers and mobile operators. "The second-last is getting a text message trying to sell them something. Geofencing should always provide a service, not an ad. Sparse and high-quality, it must give people something they need or want, and are actively seeking."
For others, the bitter pill to swallow may be losing more control over one's privacy or the idea that advertisers could know as much about them as their friends.
"It's kind of a ticking time bomb," Eckersley said. "We're excited by all these new gadgets but that could also come back to bite us."
Questions or complaints about the new geofencing or location-sensing technology and privacy protections should be sent to the Federal Trade Commission. You can make a statement at https://www.ftccomplaintassistant.gov.