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segunda-feira, junho 20, 2005

The social implications of database marketing

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A couple of years ago, in an undergraduate seminar I taught called "Spam and Society," discussion veered a bit off topic. One of the students asserted confidently that airline Web sites give first-time users lower prices than returning customers. Most of the others immediately agreed. They said the motive was to suck in potential buyers; then, when they returned, the airline could quietly raise prices.

I hear this kind of claim fairly often among heavy computer users. It seems to have become an article of faith that the unseen moguls behind all sorts of Web sites are cherry-picking consumers, customizing ads, manipulating prices and changing product offers based on what they've learned about individual users without the users' knowledge.
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Lighten up, you might say. Nobody's forcing anyone to buy airline tickets or anything else. But I'm disturbed by what this reflects about our general retail environment -- the evolution of what I would call a culture of suspicion. From airlines to supermarkets, from banks to Web sites, American consumers increasingly believe they are being spied on and manipulated. But they continue to trade in the marketplace because they feel powerless to do anything about it.

This is a profound change. Broadly speaking, the past 150 years saw what you might call the democratization of shopping in the United States. Beginning around the mid-1800s, department stores such as Stewart's in New York City and Wanamaker's in Philadelphia moved away from the haggling mode of selling and began to display goods and uniform prices for all to see. Part of the motive was self-interest: Given the wide variety of merchandise and the large number of employees, the store owners didn't trust their clerks to bargain well with customers. But the result was a more or less egalitarian, transparent marketplace -- one that Americans have come to take for granted. When they have to negotiate -- most notably in car dealerships -- they see it as an unusual, nerve-wracking experience.

This reliance on evenhanded, fair dealing lies at the heart of American capitalism, or at least the way we'd like to think of it. It's not always practiced, by any means, as antitrust suits and many consumer complaints attest. But it's a worthy goal, and such institutions as the Securities and Exchange Commission and the Federal Trade Commission were established, in part, to aim for it.
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The idea used to be that you, the consumer, could shop around, compare goods and prices, and make a smart choice. But now the reverse is also true: The vendor looks at its consumer base, gathers information, and decides whether you are worth pleasing, or whether it can profit from your loyalty and habits. You may try to jump from site to site to hunt for the best buy, but that's time-consuming. And there are comparative shopping sites such as Bizrate or Nextag, but these can be tough to navigate, and companies are learning quickly how to game the system.

This all might make sense for retailers. But for the rest of us, it can feel like our simple corner store is turning into a Marrakech bazaar -- except that the merchant has been reading our diary, while we're negotiating blindfolded, behind a curtain, through a translator.
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In the early 20th century, "keeping up with the Joneses" was a real ideal, and it spurred consumption. But the mysteries surrounding database marketing will increasingly make us not so much competitive as wary: Are our neighbors getting a better deal not because they shopped harder or bargained smarter, but because of some database demographic we don't know about and can't fight?

Lack of knowledge breeds suspicion. A survey I directed this year for the Annenberg Public Policy Center found a startling degree of high-tech ignorance among Americans who use the Internet. Eighty percent of those interviewed knew that companies can track their activities across the Web. Yet a substantial majority believe, too, that it is illegal for merchants and charities to sell information about them, even though it's legal and goes on all the time. Sixty-four percent believe incorrectly that "a site such as Expedia or Orbitz that compares prices on different airlines must include the lowest airline prices." And only 25 percent knew that the following statement was false: "When a website has a privacy policy, it means the site will not share my information with other websites and companies." Our report calls for changing the Orwellian label "Privacy policy" to the more honest "Using your information."
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We used to say, "My money's as good as anyone else's." But in the 21st century, that may no longer be true. My students can hardly remember a time before Internet cookies and frequent flying and preferred shopping. They and their kids will try to beat the system to get the best deals, all the while assuming that they don't know all the rules of the marketplace. They'll be automatically mistrustful. It's a new world out there.
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Joseph Turow is a professor at the University of Pennsylvania's Annenberg School for Communication. His book on the social implications of database marketing is to be published next year by MIT Press.
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Washington Post

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