The New Big Data Trend Uniting CIOs and CMOs

January 18, 2016 • By Atlantic Re:Think • Blog Post

IN THIS ARTICLE

  • New ways to collect consumer data can help analysts build robust behavioral databases
  • Privacy advocates claim any connected device can be tracked for better or for worse

Analytics and advanced facial recognition technology team up to let data analysts target ads one customer at a time

In the future depicted in “Minority Report,” Tom Cruise manages to stay a step ahead of almost everybody, including psychic mutants and police outfitted with jetpacks. But with all his ingenuity and tradecraft, he can never seem to escape advertising that is targeted at him and him alone. Wherever he goes, the ads find him. As he hustles through crowds, scanners read his identity, load his shopping history and discern his mood. A commercial calls his name and cinematic 3D billboard ads instantly appear. A turn of his head triggers a cascade of product pitches. Sensing his annoyance, an ad suggests a stress-relieving vacation. Another tells him to lighten up with a Guinness.

It’s beginning to look like “Minority Report” predicted the future of advertising. Sophisticated data collection and analytics already make it possible for brands and marketers to know a great deal about their customers’ purchase history and habits and advances in facial recognition technology will soon help pick them out of crowds, if it isn’t doing so already.

We’re carrying the keys to that data in our pockets. Our smartphones reveal our identities, log our activities and track our movements. Companies that work in a field called mobile location analytics trace our phones’ Wi-Fi and Bluetooth signals through airports, sports arenas and stores. Pat Parodi, co-founder of Wireless Registry, a startup creating a universal do-not-track list for phones, says our devices make us easy to find.

“If you leave your Bluetooth and Wi-Fi on, you have a proximal identity,” Parodi says. “Your phone is saying hello to the world.”

Bluetooth and Wi-Fi are not the only way a phone undermines your privacy. Default settings on an iPhone include a "frequent locations" function that logs the phone's movements. Features as innocuous as the microphone or compass can give out clues to your location, using apps that map the physical space surrounding the phone.

Addressing privacy concerns

Jules Polonetsky, executive director of the think tank Future of Privacy Forum, says that while a person’s location was once considered sensitive data, new technologies have made that notion obsolete. Every device with Wi-Fi capabilities carries a unique code called a MAC address. Polonetsky says businesses are closely following those unique identifiers.

“They are treating the MAC address like a cookie,” Polonetsky says, explaining that just as cookies track our activities online, MAC addresses reveal our movements in the real world. The information a MAC address reveals about the phone owner is limited, though. “There’s no transmission between the phone and the store where you’re shopping. What the store is doing is tracking the antennas. Based on where they are, they can guess what people are purchasing.”

Recent iPhone operating systems randomize MAC addresses, thwarting attempts to pin them to identities. Bluetooth beacons can tell when a phone is near but cannot obtain personal information from the phone. You need to give apps permission to engage your microphone and compass as locational services. But all of these functions contribute to a trail of digital breadcrumbs that retailers know how to follow.

The next generation of advertising

Google, which represents one of the most encompassing records of human activity, is testing new methods of using its data to pitch products. In 2015, digital billboards near London used Google's DoubleClick advertising services to serve ads that responded in real time to traffic, sports scores and weather. In a prooThe result was distinctly mixed, said Google—a long way from proving the search engine’s ability to bring ads tailored for the web into the real world. But neither did it discourage the belief that a day will come when your web searches and social media activity will help determine what lights up on a digital billboard that you regularly pass by.

Meanwhile, facial recognition technology now goes beyond simply establishing identity. By reading tens of thousands of data points on our faces, it can also read our moods. As police and the military have embraced facial recognition to identify criminals, advertisers have explored its abilities to attract attention. In 2012, a British children’s charity used facial scanners in bus-stop ads that could distinguish between male and female faces and serve up ads accordingly. The following year, coffee maker Douwe Egberts placed a coffee machine at an airport in South Africa that brewed coffee when it sensed a yawning face.

Since 2012, Facedeals' has used facial recognition to construct and deliver personalized deals. Participants give the Facedeals' app access to their social media accounts to build models of their faces from online pictures. When they're recognized by one of the cameras that Facedeals has mounted in public, the app analyzes their social media activity to craft a customized deal and text it to their phones.

While the Facedeal cameras only react to people who agreed to participate, other businesses aren't waiting to get permission. In 2015, several Walmart stores tested a less voluntary facial recognition program. Cameras scanned the faces of everyone who entered and compared them with photos of known shoplifters. Walmart discontinued the program after a few months, saying its cost exceeded what they'd lose to shoplifters. However, several other Fortune 500 retailers have reportedly adopted similar facial recognition technology without disclosing its use.

Tom Cruise escaped “Minority Report’s” marketers by paying a black-market surgeon to perform an illegal eye replacement. Our real-life escape from instant personalized advertising could be less invasive as we may be rescued by our own capacity for being annoyed by messages from businesses.

Advertisers are on to that too. Polonetsky of the Future of Privacy Forum says businesses know how irritating unwanted messages can be and try to avoid them for fear of alienating customers.

But that’s no reason to assume they’ve stopped watching and learning, he says, “The operating systems have done a pretty good job at preventing things that annoy people, but just because I don’t get a message when I walk by a place doesn’t mean the place doesn’t know I’m there.”


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