TODAY   |  July 16, 2013

Retailers using smartphone data to track customers

Chances are a store you shop in has tracked you either by your smartphone or via surveillance camera to better customize your shopping experience. But is it also an invasion of privacy? TODAY digital lifestyle contributor Mario Armstrong and Alex Morrison of Grey Advertising discuss retailer tracking.

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This content comes from Closed Captioning that was broadcast along with this program.

>>> ever get the feeling yourself being watched? chances are a store you shopped in tracked you either by camera or your cell phone .

>> knowing your every move helps them customize your shopping experience but is it also an invasion of privacy?

>> he is the senior vice president of grey marketing. good to have you.

>> thanks for having us.

>> why are they tracking us? is it physically tracking us.

>> companies like google and amazon have been doing this for years on the online space. the reason they track you and they even want to know is they want to personalize and customize the experience so people are more likely to buy things and be pleased with what's going on.

>> this is something we have seen online. we have gotten used to them following us around based on what we purchased before but it seems to me, being in the store and getting an alert that says we know why you are buy the thing in front of you is different.

>> again it's new, it's a little freaky potentially but the reality is the same underlying intent which is really, these companies want to give a better more personalized experience. imagine you love shoes or books, whatever it is and you're in front of that store and someone can deliver you a customized offer exactly for the thing you're interested in at that moment. that's sort of the promise of why companies are doing this.

>> so how does it work? someone walks into a store now and what happens as soon as they get inside.

>> there's a couple of different ways they can track folks. one is by video surveillance. using the cameras in the store. they can see how many people are walking into the shoe department. how long are they staying there? how many people pass the store verses go in the store and get traffic counts but then there's also wifi sensors inside a store. we have a diagram. if you're walking through a store and say you're going into like the shoe department over here, they can have wifi and if your phone is turned on to accept wifi .

>> shoe has an o in it.

>> that was an o. if you have wifi sensors located throughout the store, these senators can pick up where you have been traveling throughout the store and they can start to understand how you're shopping from that particular device. they don't know you individually. it's anonymous information but they can track your movements.

>> only if your wifi is on.

>> yes.

>> what's the reaction to this. i can't imagine everybody is crazy about this?

>> there's a big difference between the privacy debate going on and secrecy. when companies are secretive about what they're doing people react negatively to that naturally. but if companies can be transparent to consumers and say this is what we're doing, this is why we're doing it and this is how it's benefitting you there's an opportunity for this to be a win win situation.

>> it's a slippery slope . this is start of something that could get worse. you can find out more information about an individual.

>> nordstrom tried it and gave it up. their customers weren't happy about it.

>> turn your wifi off.