Mining WiFi Data: Retail Privacy Pitfalls - InformationWeek

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9/15/2014
09:06 AM
Doug Henschen
Doug Henschen
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Mining WiFi Data: Retail Privacy Pitfalls

WiFi data mining starts with anonymous tracking, but it can lead to personal details in social profiles. Interop New York session explores opportunities and limits for retailers.

the retailer wants to know these customers and is prepared to deliver value in return, such as price and inventory checks.

Another popular value-add shopping app feature is a way-finder utility that lets customers search for departments or specific items with their smartphones. These features display store maps and directions and can point out promotional items along the way. With loyalty-program integration, shopping apps can offer deals on frequently purchased items, recommended accessories for items in the shopping cart, or cross-sell items based on past purchases.

[Are there any standards in this domain? Read NIST Drafts Mobile App Security Guidelines.]

Exploiting location intelligence, retailers can detect whether customers leave the store without making a purchase, and they can geo-fence nearby competitors to see if shoppers are defecting to particular stores. These analyses aren't limited to WiFi range. With terms-of-service permissions granted through WiFi logins, loyalty program agreements, or social network logins, some retailers are tapping into GPS-based location information. The insight derived can help answer the question, "What can I do differently that will get customers to purchase in my store versus going to them?" says Adzima.

Of course, using location data crosses into what many would consider to be the creepy, invasive realm. But there are far worse examples of (mostly obscure) apps that can exploit almost anything in a social profile, says Adzima.

"Some of these apps can build complete profiles of who you are and what you like to the point that it becomes scary," he says. "I don't think retailers need all that information, and there's also the question of how they are securing that information if they're storing it?"

PCI standards and requirements to secure credit card data, but there are no requirements, standards bodies, or regulatory guidelines demanding encrypted storage or preventing sharing of social-profile data, Adzima points out.

"I would rather give out my credit card number than my social profile, because at least I can change a credit card number," he says.

In his presentation in New York, Adzima will get into the vendors that are supplying these systems, and he'll also examine "where the technology is getting ahead of the ethical discussion." For example, terms-of-service agreements for apps that track location information tend to be pages long, but Adzima is an advocate for leading with plain-English statements about data uses and benefits that are clearly displayed on login pages. He also advocates consumer education, but who is going to take responsibility for that?

"I don't have all the answers," Adzima admits. "We need to advance the discussion, get the vendors and retailers involved, and make sure that people are able to safely shop without worrying about their information being stolen or sold."

In fact, that discussion should be taken out of the context of just retailers and shopping and applied to big data analysis, where mobile, social, and online behavior data is often seen as fair game and there's too little thought given to data-ownership, ethical, and security questions that are too seldom raised. Let's not wait for scandals or, worse, tragedies, to spark the discussion. 

In its ninth year, Interop New York (Sept. 29 to Oct. 3) is the premier event for the Northeast IT market. Strongly represented vertical industries include financial services, government, and education. Join more than 5,000 attendees to learn about IT leadership, cloud, collaboration, infrastructure, mobility, risk management and security, and SDN, as well as explore 125 exhibitors' offerings. Register with Discount Code MPIWK to save $200 off Total Access & Conference Passes.

Doug Henschen is Executive Editor of InformationWeek, where he covers the intersection of enterprise applications with information management, business intelligence, big data and analytics. He previously served as editor in chief of Intelligent Enterprise, editor in chief of ... View Full Bio
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iperezseeketing
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iperezseeketing,
User Rank: Apprentice
9/3/2017 | 3:14:59 AM
Security Risk
From our point of view,  the problem is that these mentioned vendors are transmiting every MAC Address from Access Point equipment to their platforms in the cloud (where are proccessing the MAC Address information)....So they are storing MAC addresses in their IT systems. Another better alternative is to use Seeketing technology www.seeketing.com because it use other parameters of radio signals and no MAC address info is never transmited or stored.
D. Henschen
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D. Henschen,
User Rank: Author
9/16/2014 | 1:20:40 PM
Re: Apple Pay
Apple is throwing a curve ball into the WiFi analytics mix with iOS 8, which, as I understand it, will randomly generate constantly changing MAC addresses to search for Wi-Fi. This will ease privacy concerns and you will likely still see rough dwell times and traffic patterns, but it will make it harder to trace precise footpaths of individual shoppers as addresses change.
stephany3
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stephany3,
User Rank: Apprentice
9/16/2014 | 11:20:32 AM
Location Tracking Opt Out
You can actually opt-out of this kind of mobile location analytics tracking through the Smart Places Opt Out (smart-places.org)
Drew Conry-Murray
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Drew Conry-Murray,
User Rank: Ninja
9/15/2014 | 5:47:03 PM
Re: The sky is falling!
I've used one a few times. It started off well, but then the quality of the produce started to drop, so we went back to doing our own shopping. Plus, there's different things we like to get from different stores. Maybe if someone did a service that would hit four or five places...
Laurianne
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Laurianne,
User Rank: Author
9/15/2014 | 5:24:25 PM
Re: The sky is falling!
Drew, doesn't that make you want to use a grocery service that delivers?
Thomas Claburn
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Thomas Claburn,
User Rank: Author
9/15/2014 | 4:35:45 PM
Apple Pay
It will be interesting to see whether Apple Pay, with its promise not to reveal personal details of users to retailers, will change the industry's use of data.
Drew Conry-Murray
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Drew Conry-Murray,
User Rank: Ninja
9/15/2014 | 4:00:07 PM
Re: The sky is falling!
That's good. I would hate to see the jobs go away. It would also be creepy to wander around an empty store, like in the original Dawn of the Dead movie.
Wirelessnerd
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Wirelessnerd,
User Rank: Apprentice
9/15/2014 | 3:46:55 PM
Re: The sky is falling!
Hopefully not! I like to use tech to create a better customer service experience, not to replace people. Giving people the ability to understand their customers more while using technology to help serve them better is the main goal .. at least for me :)
Drew Conry-Murray
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Drew Conry-Murray,
User Rank: Ninja
9/15/2014 | 3:42:18 PM
Re: The sky is falling!
I wonder if we'll get to the point where there are no actual employees in retail stores any more. Everything will be do-it-yourself, with help available via your mobile. It's already starting to happen near me: our local grocery store rarely has more than 2 cashiers working checkout because of the self-checkout kiosks.
Ariella
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Ariella,
User Rank: Author
9/15/2014 | 10:47:38 AM
Re: shopping cart demolition derby
@David ha! I'm sure many do it already, particularly teens who seem to need to carry a device as if it were a lifesupport system.
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