Big data could save physical retail. But privacy concerns are bubbling.

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Legislators will target not just e-commerce in upcoming privacy bills

April 15, 2019 09:10AM

Stores say the new practices are meant to improve the overall shopping experience.(Credit: iStock)

Stores say the new practices are meant to improve the overall shopping experience.(Credit: iStock)

Concerns about consumer privacy are not just flourishing online but in brick and mortar stores as well.

Retailers are already using Bluetooth technology to detect customers’ smartphones when they walk into stores and hit them with promotions while they shop, and companies are also marketing facial-recognition technology to them, describing it as a way to flag shoplifters, according to the Wall Street Journal.

Stores say the new practices are meant to improve the overall shopping experience and help them stay competitive in the world of online shopping, but privacy advocates say they are bringing concerns about online surveillance into the physical world.

The debate over data privacy in Congress has mostly focused on e-commerce and social media companies, but legislators say they will include physical stores in their bills as well. Retailers worry that this could lead to a ban on some of the new technologies they are using and limit their ability to collect data for things such as customer loyalty programs.

Amazon and other e-commerce companies maintain that rules about privacy and data should be the same for online and physical stores, while some retailers worry that Amazon could just end up buying the data they have at a low price.

At the $25 billion Hudson Yards, developer Related Companies says it will hold user data indefinitely. Surveillance and privacy watchdogs are particularly concerned about the real estate company’s partnership with the firm behind the controversial LinkNYC kiosks.

Facial recognition technology has proven to be particularly sensitive for retailers, with 18 of 20 companies declining to answer an ACLU survey from last year about whether they use it. They are concerned about a backlash from customers and that the software could mistakenly identify people.

One bill from Senators Roy Blunt and Brian Schatz would ban companies that use facial recognition from tracking consumers without their consent.

“We need guardrails to ensure that, as this technology continues to develop, it is implemented responsibly,” Blunt told the Journal. [WSJ] – Eddie Small

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