Executive Briefings

FTC Eyes Use of Appliances That Spy on Purchasers After They Leave the Store

In a case that has potentially significant consequences for NFC and RFID applications, the U.S. Federal Trade Commission is cracking down on so-called "phone home" technologies used by computer rental companies to monitor consumer behavior. When contemplating the use of any technology that provides use, location or other information about a product, retailers should be careful to ensure consumers know - or are at least able to know - exactly what the product is doing once they leave the store.

Don't be so quick to conclude that your people aren't doing any of this, though, as it extends way beyond rent-to-own. Many current - and many more future - devices will have technology that enables post-purchase information capture. For example, RFID tags that aren't disabled before the customer leaves the store might enable retailers, marketers or others to capture data from those devices without the consumer's knowledge or effective consent. Embedded NFC tags or other devices make it possible to track consumers wirelessly, even after they leave the store. Smart appliances can communicate with both the electrical grid and retail outlets, so the power company knows the toaster is making Pop-Tarts or the grocery store knows when that yogurt on the top shelf has gone bad.

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Keywords: retail supply chain, RFID, supply chain management IT, tracking consumers' behavior, monitoring post-store behavior of customers, electronics spying on consumers

Don't be so quick to conclude that your people aren't doing any of this, though, as it extends way beyond rent-to-own. Many current - and many more future - devices will have technology that enables post-purchase information capture. For example, RFID tags that aren't disabled before the customer leaves the store might enable retailers, marketers or others to capture data from those devices without the consumer's knowledge or effective consent. Embedded NFC tags or other devices make it possible to track consumers wirelessly, even after they leave the store. Smart appliances can communicate with both the electrical grid and retail outlets, so the power company knows the toaster is making Pop-Tarts or the grocery store knows when that yogurt on the top shelf has gone bad.

Read Full Article


Keywords: retail supply chain, RFID, supply chain management IT, tracking consumers' behavior, monitoring post-store behavior of customers, electronics spying on consumers