Grocery apps save money — and track shoppers
Privacy concerns raised by coupon-offering smartphone apps that turn consumer data over to sellers
The increasing popularity of grocery rebate apps has many shoppers using their smartphones to get money back, but some privacy experts are raising concerns about who can see consumers' shopping habits.
The trend is often embraced by those who like "couponing," such as Chelsea Mosher of Halifax.
"Since I've started couponing I've saved quite a bit of money on food and different objects like cleaning supplies," she said. "It's just all-around a bonus."
The mother of two young boys says she always makes an effort to save money and to keep her family eating healthy food. "It's very much a priority."
The app creators say they're trying to reach out to consumers like Mosher on behalf of big brands like Unilever, Kraft, and Pepsico.
"When you're launching a new item, it's very difficult to have a consumer at shelf pick up that new item off the shelf and put it in a basket and get through the cash register with it," said Neil Hunter, co-founder of Cartsmart.com, owned by Consumer Kinetics of Mississauga, Ont.
"We bring about an opportunity to interact with the consumer in the store, as they're using their phone."
Hunter says his app helps larger companies offer deals which are relevant to consumers and won't be tossed aside as spam.
"I receive emails every day with offers for everything under the sun, but what those companies should know is that a deal on leg waxing is not relevant to me," he said.
Toronto-based Noah Godfrey created another app called Checkout51, which operates in a similar way. Consumers scan and submit their store receipts, then match what they've purchased to a list of offers available through the app. If they've purchased an item on the list, Checkout51 will credit them with a rebate of up to a few dollars.
"With us they can give different people different offers based on what they've redeemed in the past," Godfrey said. "So they can be a lot more focused and targeted."
Godfrey says his company takes its users' privacy very seriously, but it is part of their regular operations to share data.
"We do share some of that aggregate data with our brand partners to help them make better decisions in terms of what products to put on offer."
Both Hunter and Godfrey said their companies only share data about what groups of people are doing and never any information that could identify an individual.
But Prof. Michael Geist, the Canada research chair in internet and e-commerce law at the University of Ottawa, says he is concerned that might not be good enough.
"There is a sense you can often put Humpty Dumpty back together again," he says.
"So that de-identification of information, an attempt to try to remove the person from the data itself and just aggregate it together, there is sometimes a fear that there is the ability to put that information all back together again and bring down to an individual person."
Think that this data, because at the end of the day you don't control the destination.- Stan Matwin
Geist says small products like milk and eggs aren't worth enough for someone to try to find out who bought them. But he says in the case of an item like an expensive drug, maybe somebody would attempt to reconstruct the data.
Geist says consumers should be aware of what they're agreeing to and it's not reasonable to expect everyone to read each page of a privacy agreement.
Stan Matwin, director of the institute for big data analytics at Dalhousie University in Halifax, shares some privacy concerns.
"Think about a different scenario," he said.
"Think that this data — because at the end of the day you don't control the destination — comes to somebody who works with an insurance company, health insurance, and they find out that maybe you buy too much food that contain cholesterol-inducing chemicals and therefore they will raise your insurance premiums, right? And you wouldn't know about it."
Mosher says she doesn't mind big brands knowing more about her buying habits, especially if it will allow them to send her more deals she'll actually use.
"It'd be better for them to get information on things that people get on everyday purchases," she said.
She says her apps don't ask for financial information, so she feels safe with them. Since they make her family's budget easier, she likes using them.
"That's an extra $20 in your pocket that you didn't have," she said.