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3 On Your Side: Retailers Spying On You

jim-donovan-web Jim Donovan
Jim Donovan is a 13-time Emmy Award-winning consumer reporter w...
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By Jim Donovan

PHILADELPHIA (CBS) — If you’re shopping with your smartphone chances are someone may be keeping track of your habits.  As 3 On Your Side’s Jim Donovan explains, many stores are now using your phone to secretly watch you shop.

Many stores are now tracking shoppers from the second they walk through the door.

This is not about preventing shoplifting, but about knowing a shopper’s habits. And to get this information, stores are tapping into your cell phone’s Wi-fi.

“They can tell how long you were in the store, which departments you were at,” said Edgar Dworsky with ConsumerWorld.org.

Stores say this type of Wi-Fi tracking is anonymous and it gives retailers important information that ultimately helps customers —  like knowing when to put more cashiers at the register or sales associates on the floor.

“There’s something about certain privacy issues that just kind of leaves a bad taste in your mouth,” said Dworsky.

Nordstrom used the technology for nine months at seventeen stores across the country. The experiment ended after complaints from customers. Family Dollar tells us they are testing it out in one store but they won’t say which one.  Connect to Target’s free Wi-Fi and they’ll be watching your movements in the store.

Despite what retailers say is a benefit, some stores are not letting customers in on the secret.  And now privacy advocates, retailers, and the tech companies are working on guidelines for this type of tracking to be enforced by the federal government.

“It’s a challenge for retailers to make the case to consumers look here’s what we are doing, here’s why we are doing this, here’s how we are trying to help otherwise they’ll be concerned.  Many retailers are competing with Amazon.com and other online merchants who obviously have lots of data about what you do online,” said Jules Polonetsky, Executive Director at Future of Privacy.

Shop online and those stores can easily track your movements and send you targeted ads. Tracking a shopper’s cell phone inside a store could just level the playing field.

“There’s some movement to try to let consumers opt out,” said Dworsky.

Or you can always turn off your Wi-Fi and then shop without big brother watching.