{"id":206,"date":"2012-09-11T04:08:39","date_gmt":"2012-09-11T04:08:39","guid":{"rendered":"http:\/\/www.apisbull.com\/blog\/?p=206"},"modified":"2012-09-11T04:08:39","modified_gmt":"2012-09-11T04:08:39","slug":"206","status":"publish","type":"post","link":"https:\/\/www.apisbull.com\/blog\/?p=206","title":{"rendered":""},"content":{"rendered":"
Most people like to get freebies and discounts. They\u2019re even willing to give up a little privacy in exchange.\u00a0<\/span><\/div>\n

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Jennifer was no different. \u00a0<\/span>And it got her into some real hot water.\u00a0<\/span>For Jen, it started off so innocently.\u00a0<\/span>She had worked hard at her summer job and saved up enough money for a new iPod.\u00a0<\/span>She scanned the \u201cback to school\u201d fliers and found out that Target had the best price in town.<\/span><\/div>\n

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What made it even better was that the store was right on the way to her high school. She and her friends sometimes even hung out there after classes.<\/span><\/div>\n

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So she took $200 of her summer savings and stuffed them in her front pants pocket.\u00a0<\/span>Then she headed down to the store, whistling and skipping along the way.\u00a0<\/span><\/div>\n

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Inside the store, her wide eyes carefully pored over the showcase of mp3 players. She finally settled on a pretty, purple iPod touch and took it to the checkout stand.\u00a0<\/span><\/div>\n

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Nervously she pulled the money out of her jeans. She fidgeted as she waited her turn. It was the biggest purchase she\u2019d ever made.<\/span><\/div>\n

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\u201cDo you have your Target card?\u201d asked the clerk.\u00a0<\/span><\/div>\n

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\u201cNo. Do I need one?\u201d replied Jennifer cautiously.<\/span><\/div>\n

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\u201cYou don\u2019t need one, but we can give you another 10% off your purchase today if you apply right now.\u201d<\/span><\/div>\n

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The deal seemed too good to pass up. An extra $20 in her pocket just for giving up her name and address. What a deal!<\/span><\/div>\n

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Jennifer quickly filled out the form and signed the bottom without reading all the fine print. That was her first mistake.<\/span><\/div>\n

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But it didn\u2019t seem like a mistake at the time. In fact, Jen was ecstatic. She even bragged to her friends how she\u2019d gotten her brand new iPod for such a great deal.\u00a0<\/span>They thought it was cool, too.<\/span><\/div>\n

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And as the Fall semester rolled along, Jennifer was even happier with her decision.<\/span><\/div>\n

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Target started sending her coupon booklets twice a month right to her home.\u00a0<\/span>She was amazed how all the coupons seemed to match exatcly what she wanted.\u00a0<\/span><\/div>\n

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In October she used one of the coupons to buy some purple Skullcandy Ink’d earbuds for her new iPod.\u00a0<\/span><\/div>\n

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And in November she bought a \u201cLove 87\u201d T-shirt using the coupons Target sent her.\u00a0<\/span><\/div>\n

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Her social life was improving too. Since she had money to buy cool stuff, more kids at school started paying attention to her. Boys too.\u00a0<\/span>Life was good. At least for a while.<\/span><\/div>\n

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It wasn\u2019t until after Christmas break that the problems began.<\/span><\/div>\n

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The first coupon flier Target sent to Jennifer\u2019s home in 2012 had a picture of a crib on it. It announced the biggest \u201cbaby bedding\u201d sale of the year.\u00a0<\/span><\/div>\n

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The next coupon filer featured baby strollers on the front.<\/span><\/div>\n

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But it wasn\u2019t until the third coupon booklet came with a promotion for maternity clothes that Jennifer\u2019s dad got involved.<\/span><\/div>\n

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Outraged, he stormed into the Target store and demanded to see the manager.<\/span><\/div>\n

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Waving the coupon flier in front of the manger\u2019s face, he demanded an explanation.\u00a0<\/span><\/div>\n

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According to a Target employee who witnessed the confrontation, the angry father said:<\/span><\/div>\n

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\u201cMy daughter got this in the mail! She\u2019s still in high school, and you\u2019re sending her coupons for baby clothes and cribs? What\u2019s going on? Are you trying to encourage her to get pregnant?\u201d<\/span><\/div>\n

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The manager looked at the mailer, cringed, and apologized.<\/span><\/div>\n

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Indeed the flier was addressed to the man\u2019s daughter and featured coupons for maternity clothes and other baby items.\u00a0<\/span><\/div>\n

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A few days later, the store manager decided to call and apologize one more time. His hope was to keep Jen\u2019s dad as a customer.\u00a0<\/span><\/div>\n

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Instead he got a big shock.<\/span><\/div>\n

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\u00a0\u201cI had a talk with my daughter,\u201d Jennifer\u2019s dad said in a much less combative tone.\u00a0<\/span><\/div>\n

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\u201cIt turns out there\u2019s been some activities in my house I haven\u2019t been completely aware of. She\u2019s due in August. I owe YOU an apology.\u201d<\/span><\/div>\n

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Whoa!<\/span><\/div>\n

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The NY Times broke the story earlier this year. (we dramatized it, but it IS a true story).<\/span><\/div>\n

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So how does Target know a girl is pregnant before her own father?\u00a0<\/span><\/div>\n

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Two words:\u00a0<\/span><\/div>\n

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Big Data<\/strong><\/div>\n
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That\u2019s the new catchphrase for the growing pile of electronic data that litters databases and fills up hard drives each day.<\/span><\/div>\n

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Some of the information is personal. Some is generic. Altogether, it\u2019s becoming a gold mine for those who can make sense of it.<\/span><\/div>\n

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Sifting through this data to find meaning and predict behaviors is the next frontier in artificial intelligence.<\/span><\/div>\n

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Coupon targeting (like Target did) which tries to anticipate a customer\u2019s needs is just the tip of the iceberg.<\/span><\/div>\n

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Andrew Pole is the Target statistician who came up with the computer algorithm that predicted Jennifer\u2019s pregnancy.<\/span><\/div>\n

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He took years of buying pattern data from known pregnant women and programmed it into a computer routine.<\/span><\/div>\n

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The computer sniffed every purchase made at Target to see if it matched the patterns he identified.\u00a0<\/span><\/div>\n

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A few of Jennifer\u2019s purchases in early Fall caught the computer\u2019s attention.\u00a0<\/span><\/div>\n

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When her purchases continued to fit into the pattern of a pregnant woman, Target\u2019s central system flagged her as pregnant… \u00a0and began mailing the baby coupons.<\/span><\/div>\n

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Depending upon how you look at it…\u00a0<\/span><\/div>\n

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Big Data Sounds Either\u00a0Really Cool or Kind of Creepy<\/strong><\/div>\n
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Marketers tend to think Big Data is awesome. It makes their job of targeting responsive buyers much more efficient.<\/span><\/div>\n

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For a consumer, getting relevant coupons can also make life easier…<\/span><\/div>\n

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But some things (like pregnancy) can be very sensitive topics. Marketers will need to use discretion if they don\u2019t want to scare off potential customers.\u00a0<\/span><\/div>\n

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Even Target agrees. \u201cIf we send someone a catalog and say, \u2018Congratulations on your first child!\u2019 and they\u2019ve never told us they\u2019re pregnant, that\u2019s going to make some people uncomfortable,\u201d said a Target spokesman.<\/span><\/div>\n

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No kidding!\u00a0<\/span><\/div>\n

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Of course it\u2019s not just large chain stores mining your personal data.<\/span><\/div>\n

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Big Data Is Part of\u00a0Every Aspect of Your Life<\/strong><\/div>\n
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Unless you live out in the woods and off the grid (not a bad idea, by the way) … Big Data has its eye on you.<\/span><\/div>\n

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Think of all the things that keep track of you:<\/span><\/div>\n
\u2022 surveillance cameras in stores\u00a0<\/span><\/div>\n
\u2022 websites you visit\u00a0<\/span><\/div>\n
\u2022 vehicles you license<\/span><\/div>\n
\u2022 electronics you register<\/span><\/div>\n
\u2022 taxes you file<\/span><\/div>\n
\u2022 internet searches you make<\/span><\/div>\n
\u2022 credit and debit cards you use<\/span><\/div>\n
\u2022 loyalty shopping cards<\/span><\/div>\n
\u2022 cell phone calls & text messages<\/span><\/div>\n
\u2022 etc. etc., etc.<\/span><\/div>\n

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Many people don\u2019t even realize how willingly they give up their (so-called) right to privacy. \u00a0<\/span><\/div>\n

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For example, Facebook can use any post you make for its marketing purposes … even after you delete your account. (Read the fine print!)<\/span><\/div>\n

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Other times, the data is used in ways you might not expect. Or by people who shouldn\u2019t have it.<\/span><\/div>\n

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For example, in late August 2012 a group of hackers reported they had broken into an FBI agent\u2019s laptop and found a database with over 12 million Apple customers.\u00a0<\/span><\/div>\n

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The database had the unique device ID paired up with a name, address, phone number, zip code and other personal information.<\/span><\/div>\n

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Why the government had this info, where they got it and how they were using it is unclear. \u00a0The hackers claim the FBI was using the info to track the owners.<\/span><\/div>\n

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The FBI, of course, denies any involvement, even though the hacker group released 1 million of the Apple IDs to warn these iPod users they were being watched.<\/span><\/div>\n

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And frankly, it\u2019s hard to know if the FBI having such data or hackers having it poses a greater risk.<\/span><\/div>\n

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The Future of Big Data<\/strong><\/div>\n
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Love it or hate it, Big Data is going to be a big part of the future. And it is quickly making the type of privacy we\u2019ve enjoyed in the past pass\u00e9.\u00a0<\/span><\/div>\n

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It\u2019s almost like living in a small town again. You know, where everyone knows everything about everyone. (My uncle talks about growing up in a town so small that if he played hooky from school in the morning, the whole town knew about it by dinnertime.)<\/span><\/div>\n

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We recognize that Big Data is here to stay. More privacy laws (as important as they might be) won\u2019t prevent its spread.<\/span><\/div>\n

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Rather than fight it, we look for solutions to protect our personal liberty in an increasingly transparent world.\u00a0<\/span><\/div>\n

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As we move deeper into the digital era, Big Data will continue to offer undeniable opportunities.<\/span><\/div>\n

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There will be a huge demand for skilled programmers who can sift, sort, refine and interpret the mountains of new data into a meaningful context.<\/span><\/div>\n

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And since the field of Big Data is so ripe for explosive growth in the next several decades, you\u2019ll also want to keep a look out for any potential investment opportunities in data mining companies.<\/span><\/div>\n

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For now, though, your best bet is to be aware of the privacy issues, protect yourself as much as possible, limit your \u201cprivacy leaks\u201d, and keep your options open.\u00a0<\/span><\/div>\n

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You do that by investing wisely, and positioning yourself for personal and financial independence.\u00a0<\/span><\/div>\n<\/div>\n

Buy silver and gold. It keeps the government out of your business.<\/div>\n