When Robert Rivera signed up for a Vons grocery store card, he had no idea that detailed records of his shopping habits would one day be used against him. But that's exactly what he says happened.
Rivera was shopping at a Los Angeles Vons store two years ago when he slipped on a slick of spilled yogurt, causing him to fall and shatter his kneecap. Unable to drive, let alone work, he sued the store for damages. During the negotiations, says 59-year-old Rivera, a mediator played hardball in encouraging him to settle. "He came in and said, 'They want to settle because they have information that you buy a lot of liquor,'" he recalls. As Rivera tells it, the mediator indicated that the store had accessed his shopping records and would use them against him in court.
Rivera didn't settle the case, which is due for trial on Oct. 19 -- instead, he went to the local media. And Vons, which now says it never peeked at the records or intended to use them in court, backed down from its threat.
Grocery store "club cards" have become commonplace in supermarkets across the country -- by last count, nearly a quarter had implemented such programs, with 40 percent planning to follow suit in the near future. In the stores that offer them, using a card is usually the only way to earn discounts on groceries -- even items that used to be automatically marked down without coupons.
Signing up is a tempting proposition, especially for those on a tight budget. Literature for Safeway, which has been offering club cards for over a year, makes coupon cutting out to be heavy labor and guarantees "instant" and substantial savings, all with the convenience of a little plastic card swiped at the point of purchase. Why, you may even save on items you didn't realize were on sale! "It's never been this easy," promises Safeway.
The problem is, in order to get those easy savings, customers have to turn over a whole host of personal information. Safeway requests a full name, home address, birth date and home phone number (used to access the account should you leave your card at home). In tiny little print, the application explains why: All purchases -- of toilet paper, bacon, medication, video rentals, magazines and anything else that passes through the scanner -- will be automatically recorded in a database and associated with each shopper's name and address.
Safeway and other stores intend to use this information to track regional buying habits and to build customer profiles, so they can replace scattershot newspaper coupons with tailored mailings sent directly to card members. "Say, Mrs. Johnson, we've noticed that you've been buying baby food lately. You must have a baby in the house. Here are some other baby-related savings you might enjoy." Or the more menacing, "So, you've been buying large amounts of painkillers, Mr. Jones. Would you like to try another, extra-strength brand?"
Supermarkets need programs like these, claim marketing gurus, to compete with cheaper warehouse retailers like the Wal-Mart-owned Sam's Club. "The supermarket industry is amazingly competitive," says Carole Throssell, director of media relations for the Food Marketing Institute. "Anything the store can do to attract and keep customers, the store is going to consider."
Some companies are marrying the cards with other functions, like check cashing, intertwining bank and purchasing information. Other programs link whole groups of retailers -- a bank in Cincinnati recently started a card program where purchases at a host of local stores are recorded into a central database. Customers who use the card receive discounts and earn points that can be spent at participating retailers.
If it doesn't bother you that businesses should have such comprehensive and personal records of your habits and preferences, consider that Maryland-based Giant Food Inc. was caught earlier this year providing its customers' prescription purchasing information -- medical records -- to marketers. The grocery store stopped releasing the records after the public found out about it and complained mightily. But companies sell or give away information on customers all the time (how do you think you get all that junk mail?) and grocery store records could, and undoubtedly will, be used in any number of ways.
Beth Givens, director of the San Diego-based Privacy Rights Clearinghouse, imagines these potential worst-case scenarios: "Insurance companies use them to look for people who smoke, drink alcohol, take over-the-counter medications that indicate serious health problems or eat unhealthy foods. Employers could use them to look for people with unhealthy lifestyles." They could also be subpoenaed by police or attorneys trying to build cases, as exemplified by Kenneth Starr's subpoena of bookstore records in the Monica Lewinsky investigation. (A judge ordered the records turned over, but Lewinsky released them herself before the store had to comply.)
Most supermarkets, including Safeway and Vons, insist that they're sensitive to privacy issues and won't sell or release personally identifying information to other companies. But, as Givens notes, "There is no law that prevents this sort of stuff from happening." And there's no law to stop stores from using the information for their own benefit in lawsuits, as allegedly happened in Rivera's case.
It seems the only way to get supermarket discounts these days without becoming part of a tell-all database is to put a fake name and phone number on the club card application, or fill it out anonymously. "We've had customers request the ability to change their name to 'Safeway Customer,'" admits Debra Lambert, Safeway's corporate director of public affairs. "We do allow that."
Or, you can check in at the "No Cards" Web site for tips on letter-writing campaigns and card program sabotage (one letter writer suggests filling out a new card every time you go through the checkout line, costing the store extra bucks in plastic and data-management fees). The site, started by Zelda Gordon and Dale Berlin, two shoppers in New Mexico, has a motto: "A FREE PEOPLE DOES NOT SHOW IDENTITY PAPERS TO BUY BREAD." It was started after Gordon wrote a letter to the editor of a local newspaper, complaining about the two-tier shopping system card programs create. "We sort of call it a consumer movement," she says. "This is a way of bribing us to surrender demographic information, which is obviously very valuable at this point."
Too bad for Robert Rivera that he didn't stumble upon the No Cards site before cheerfully filling out his Vons card application. Rivera, who hasn't been able to return to his job as a motion picture security guard since the accident, is currently supported by his son. He mainly stays home in his East Los Angeles neighborhood, nursing his knee and wondering how he'll purchase decent Christmas presents for his wife.
"My wife and I used to take vacations," he says. "We used to have money and I had a good job. But now I'm sitting here building a slingshot to scare away some cats. I'd just say, be careful what you sign because they will know you from head to toe. And they could use it against you."