Brick-And-Mortar Is The Next Privacy Challenge

Online privacy gets a lot of attention, especially as online sales grow each year, but privacy — and its potential loss at the hands of data-collecting devices — is a rising concern in a brick-and-mortar retail context as well.

retail spying

Consumer data is now one of the most valuable assets for nearly all retail companies — not just digital ones, Axios reports.

Most large businesses operate simultaneously in both physical and digital realms, and the boundaries between data use online and offline have blurred.

The new question is, how much data collection about customers via surveillance systems used by physical retailers is too much?

"To the extent that these problems are difficult to address online, it’s even more difficult to address privacy issues offline," Upturn Executive Director Harlan Yu told Axios.

Upturn is a digital privacy nonprofit.

One uncertainty about in-shop monitoring of customers is whether policymakers — including a Congress marked by inaction in recent years — will address questions of how much data retailers should be allowed to gather, what they should be allowed to do with it and how long they should be allowed to keep it.

The technology for monitoring shoppers as they wander through stores is much more sophisticated than it used to be, allowing retail companies to gather a wide variety of data on their customers.

Retailers want as much data as possible, partly for security reasons, but also in the drive to make retail more autonomous.

However, it isn't clear which stores are using which kinds of technology, including facial recognition software, which has significant potential for establishing watchlists, lists of people that retailers might consider undesirable because of a history of shoplifting or some other reason.

Watchlists can have serious downsides for people who are not security risks. As people who are wrongly on the Transportation Security Administration's no-fly watchlist can attest, the results can be nightmarish.

In 2018, the American Civil Liberties Union took a list of the top 20 retailers published by the National Retail Federation (minus Amazon) and asked each retailer: Are you using face recognition with cameras on your customers?

According to the ACLU, only one, Lowe's, said it was, to identify shoplifters. Only one said it wasn't: Ahold Delhaize, whose U.S. brands include the supermarkets Food Lion, Stop & Shop, Giant and Hannaford. The other 18 were mum.

Lowe's spokeswoman Maureen Wallace said that the company does not use facial recognition technology. She said four years ago, the company conducted a three-month test of it at three stores, and ultimately decided against using the technology.

UPDATE, JAN. 6, 8:45 P.M. ET:  This article was updated to add a statement by Lowe's that it does not use facial recognition technology at its stores.

Continue reading this story with a free account

Log in or register
Sign up for more articles like this
Subscribe to Bisnow's National Newsletters
Related Stories

Why Hines Is Restarting Its Development Engine

How Integrated Infrastructure Can Help AI Data Centers Deploy Faster, Build Smarter

Nvidia Buys Stake In Data Center Power Company

Invesco Cuts Fees, Adds Incentives To Quell Fund Redemption Requests

Investors Anchor Big Capital Into Marinas, Betting On Shallow Supply

Nike Closes 15 Stores Amid Tumultuous Year

Large Commercial Real Estate Sales Up 30% Despite Economic Headwinds

Evergrande Founder Sentenced To Life, 56 Others Sent To Prison In China

Loud And Clear: Why Aiphone Thinks Intercom Ownership Is Best For Multitenant Buildings

The Fast-Food Exec Taking Her Real Estate Talents To The Looksmaxxing Era

Republicans, Democrats Backing Away From Data Centers Amid Rising Backlash

TJ Maxx Parent Plans To Accelerate Store Openings In 2027