The advent of online coupons has made shopping and saving that much easier. In an earlier era, people spent their Sunday mornings clipping coupons out of the newspaper. Now, you can download coupons from dedicated sites like Coupons.com or Ebates.com, or even social networking sites like Facebook and LinkedIn. But this convenience carries certain privacy risks: Some companies track consumer spending habits based on the coupons those consumers use.
Last April, The New York Times reported on how a company called RevTrax, which manages online coupons for retailers, was tracking consumer spending habits through these online coupons. RevTrax clients include stores like Filene's Basement, Lord & Taylor, and Micro Center; restaurants like Ruby Tuesday; and a number of marketing agencies representing multiple clients.
Collecting Your Data
So what does all of this mean for consumers? Suppose that you sign into Ebates.com via Facebook Connect and obtain a coupon for Ruby Tuesday. You take in that coupon, it gets scanned, and you enjoy your discounted dinner. However, you might choke on your cheesecake if you realized how much information the restaurant has collected about you.
Once the restaurant scans your coupon's barcode, RevTrax can track it back not only to the search terms used in Ebates.com to find that coupon but to the Facebook ID, including your first and last name, that was used to log into the site. Now the company has access to your search habits and your social networking habits. It also has access to your location, your gender, and your interests.
Note that RevTrax simply collects all this data; where the data goes and how it is used is up to the retailer employing RevTrax's service. If Ruby Tuesday wants to send a "thank you" message to your e-mail address and offer additional deals, the restaurant can now do so thanks to its access to your information.
What's most disturbing is that RevTrax is completely invisible; you have no way of knowing whether a coupon is on RevTrax's platform or not.
And RevTrax isn't the only company out there that is tracking customers' spending habits. This spring, Skeptical Shopper looked at a company called RapLeaf that used Facebook and Twitter to create targeted ad campaigns for banks and other financial institutions.
(The companies using RevTrax's services insist that they use the data simply to reach their customers better.)
Protect Your Privacy
Though most of the data collected when you use a coupon may be harmless, you can never be too sure. I recommend adjusting the privacy settings on your Facebook profile. Also, don't use Facebook Connect to log into e-coupon sites.
ReclaimPrivacy.org has a neat tool that will scan your profile and account settings. For each area of your account, ReclaimPrivacy will give the setting a green ("good"), yellow ("caution"), or red ("insecure") ranking. If your account settings prompt yellow or red warnings, the site will give you instructions on how to change those problematic settings.