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TERRY GROSS, HOST:

This is FRESH AIR. I'm Terry Gross.

We've become accustomed to the idea that when we shop online, retailers are collecting information about us. But you might not realize how much information is being collected about you in some of the stores you shop in.

My guest Joseph Turow says we're on the cusp of a retailing era that is adding an entirely new level of routine surveillance, like the ability for the retailer to know when you've walked into the store and then track where you are within it and what merchandise you've been handling - not to prevent you from shoplifting, but to get a profile of who you are as a consumer. Your profile may affect the price you are charged at checkout.

Turow is the author of the new book "The Aisles Have Eyes: How Retailers Track Your Shopping, Strip Your Privacy, And Define Your Power." His previous book was about how the advertisers track you and profile you and use that information to sell to you online. He's a professor of communications and associate dean for graduate studies at the Annenberg School for Communication at the University of Pennsylvania.

Joseph Turow, welcome to FRESH AIR. Tell us something that's going on right now in stores - in some stores that most of us shoppers do not know about.

JOSEPH TUROW: Well, in many stores around the United States and even around the world, there are these boxes called Bluetooth boxes that connect to your phone. And when they do that, they track how you're walking through the store, where you are and can even change the price on goods based upon where you are.

GROSS: So do I have to activate anything on my phone? Can they talk to my phone right now if I walk into the store?

TUROW: You have to have an app on, and the app has to either be the store's app or have code in the app that can talk to those boxes in the store.

GROSS: So you mentioned something about how they could change the prices as I shop?

TUROW: Yes, change the price simply means discount. So what they can do if you're walking in front of diapers, and they have a deal with the diaper manufacturer, they can say, looking at the history of your shopping, we know that you buy X diapers. Well, we're going to give you 15 percent off for Y diapers as you're standing there. And the person next to you may get nothing, even with the app on.

GROSS: OK. So we are being tracked in some stores as we go through the store, and it's making decisions about us as we shop.

TUROW: Yes, absolutely.

GROSS: OK. Now, let's take a step back. Something I know is going on at my drugstore - my big, chain drugstore where I shop - I shop there a lot. And I get these, like, long, long, long, long, long receipts that have discounts for all kinds of things. And sometimes it's just, like, a dollar thing where I'll get, like, $5 or $10 I can put toward my next purchase. Sometimes I get a 20 or 25 percent discount through the mail or through email. So that's made me a pretty loyal shopper there because I get cheaper prices, or at least I think I do. What are they learning about me in the process?

TUROW: Well, what that company does, it keeps, last I heard, about 52 weeks' worth of information about your shopping. They may or may not know your actual name. They may just know your frequent shopper card number. And based upon that and the deals they have with advertisers, they will decide what kinds of discounts to give you, again, knowing your shopping history.

GROSS: So the program I'm talking about at the chain pharmacy where I shop, that's a loyalty program. There's lots of different kinds of loyalty programs. What are some of the ways that they are operating behind the scenes to either get information from us and give us, you know, discounts in return - like what - what are some of the loyalty programs that would be helpful for we consumers to know more about?

TUROW: Originally, loyalty cards and loyalty was for the idea of having you come back to the store. If we went back to the early 20th century, people used to collect stamps based upon what they bought. And they would put the stamps in books. And then they would use the books to purchase or get products based upon those cards.

Increasingly, loyalty really means rewards, and rewards, from the standpoint of a store, means getting your information, getting data about you. So the whole purpose is, when you buy something, you think you're doing it because they want your loyalty. They do want your loyalty. But mainly, they want your data. And that data becomes the source of a lot of discounts that they give you while you're walking through the store, while you're going online, any time the company has connections to you.

GROSS: And they get that data through the bar code that's used at checkout?

TUROW: Yes, sometimes. Sometimes they may get the data based on what you do online. Sometimes they may get the data based on how you're walking into the store with your phone on, if you have the right app or with Wi-Fi even. Sometimes they may get the data based upon your walking outside and your app is connected to GPS. And they actually can track where you're moving in the outside world.

GROSS: So you're referring to apps here. Some stores have their own apps.

TUROW: Yes, they do.

GROSS: And you download the app. What's in it for you, the consumer? What's in it for the retailer?

TUROW: Well, the retailers like apps because they can present discounts to you. They can give you information about the store. They can give you layout about the store. Consumers are supposed to want that for the same reasons. But the idea is that - and consumers know this - when they walk through the store, they may get differential discounts. Or they can find out different things about where things are located in the store.

GROSS: So tell us more about what the store is getting from you, the consumer.

TUROW: The store is getting where you're moving in the store. The store may be getting where you're moving outside the store.

GROSS: Why do they want to know that?

TUROW: Well, they might - in some cases, they may know where you're going near a competitor. They may know how to reach you in a particular location. There's a whole area of marketing now called geolocation marketing, where, for example, let's say you're a coffee shop. And you know that a person is going near a competitor coffee shop. You can actually purchase the ability to reach a person on her phone as that person moves toward the coffee shop and say, don't go to this place. Go to another place because we'll give you 15 percent off.

GROSS: Are you saying that once you download a store's app, some of those apps give the - the - the store, the retailer the ability to track you even when you're not in the store?

TUROW: Absolutely.

GROSS: So they know your other shopping habits. They know where you are. That's kind of - sounds like spying.

TUROW: Well, it is a kind of spying. The other thing about it, Terry, is that the apps can sleep so that you may think your app is off, but it really isn't off. And it can go on when you don't realize it. People don't understand that.

So you have to make sure that the app is totally off if you don't want to use it. You may think it's not on, but if you have that app not totally turned off, the company can reach you and understand where you are.

The other thing to realize is - I don't know if you recognize when you go download an app, the app will sometimes say, do you want us to track your location? Can we track your location?

GROSS: I was going to ask you about that. I get that all the time.

TUROW: Yeah, and sometimes it has nothing to do with the company that you're taking the app for. The reason is what I was saying. The reason is that they want to be able to sell your location often to another company.

GROSS: So do you - what do you - what do you do when you get that on your phone?

TUROW: I don't. I say no.

GROSS: You always say no.

TUROW: But they know that a lot of people simply want to get to the app, so they'll push that button and say, yes, OK. And they don't quite think it through. It's all in the impulse.

GROSS: I'm always afraid if I say no that, like, 10 minutes later I'm going to need one of my maps, and I won't - I won't be able to connect with it because I just said, no, don't disclose my location.

TUROW: Right, and if it's a mapping technology, you obviously need it. But there are variations with mapping companies. You can say, keep it on all the time. You can say, only use it when I'm using this map, when I need the map.

GROSS: So phones are really, like, the game-changer for retailing.

TUROW: Phones are, in many ways, a marketing device. People don't realize it, but there's so much in the phone that can be used by marketers, even to the point of knowing where you are in a mall based upon the accelerometer, what level you're on. OK?

GROSS: Whoa, whoa, whoa. The accelerometer, what is that?

TUROW: There's an accelerometer in the phone that can tell whether you're going up or down.

GROSS: You mean it's built into the phone?

TUROW: It's built into the phone. And there are companies that use the accelerometer as one way to figure out where you are in a store, in a mall. So there are ways to use elements of the phone in ways that are unpredictable and very out of the ordinary, but can be very useful for marketers.

GROSS: Right. OK.

So if you're just joining us, my guest is Joseph Turow. He's the author of the new book "The Aisles Have Eyes: How Retailers Track Your Shopping, Strip Your Privacy, And Define Your Power." Let's take a short break here, and then we'll talk some more about technology that is tracking us as we shop.

This is FRESH AIR.

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GROSS: This is FRESH AIR, and if you're just joining us, my guest is Joseph Turow. He's the author of the new book "The Aisles Have Eyes: How Retailers Track Your Shopping, Strip Your Privacy, And Define Your Power."

So there are apps that you can download in which you can use your phone to check out because your phone will read the barcode. I assume that's how it works?

TUROW: Yes.

GROSS: So what are you activating when you activate that app? Is that the kind of app you've been talking about?

TUROW: There are apps that do that. When you're activating an app, you're simply telling the company that you want this particular item. It's not necessarily - it could be tracking you at the same time. They're all interrelated...

GROSS: But not necessarily?

TUROW: But they don't have to be. And I should distinguish that from the Apple checkout, for example, which is a very different technology. That is designed to be quite secure. And frankly, using Apple Wallet to check out, to pay for something, can be more secure than using, swiping your card.

GROSS: So your reference to the Wallet on a lot of people's phones reminds me of how retailers are using that. You write about that in the book. So what's - for people who don't use the Wallet app on their phone, explain what it is and how retailers are using it.

TUROW: The Wallet app is something you can find on an Android phone and an iPhone. And the purpose of the app, from the marketing standpoint, is to allow marketers to place - to have you place coupons and other messages into that place, even if you don't have an app. OK?

So let's say you get a text message. The text message has some information for you that you want to store or a discount coupon that you want to store. You click on it. It goes into the Wallet. That Wallet - then that message can have a tag on it that sets it to show up on your front screen - your lock screen of your phone - at a particular place.

It can also change. If it's a discount coupon, the marketer can actually change the price depending on where you are in the marketer cycle of what it thinks you should pay for something. So the longer you keep something in your Wallet, the marketer can say, gee, this person isn't purchasing it. We'll go in, change the price and then have you see it. And maybe you'll buy it then.

GROSS: So retailers like the Wallet app?

TUROW: They do because they don't figure that everybody has an app for their own thing. See, that's the problem. Right now, the real problem with Bluetooth is that you need an app. And there is this whole...

GROSS: The problem for who, for retailers using Bluetooth?

TUROW: For retailers. The problem for retailers is that in order for them to connect to your phone via Bluetooth and to track you through the store, you need to have that app on or Wi-Fi. But typically, particularly, to know who you are, you need the app. The Wallet is an app. And so even if something goes into your text messaging and then you put it in the Wallet by clicking on it, the retailer has a way to connect with you that way, even if you don't have the retailer's app.

GROSS: But you said that you thought the Apple Wallet app was very secure.

TUROW: For payment. Apple payment is extremely secure. And so the idea is when you pay, they have a token. So the retailer where you pay will never know your credit card number. It's a certain way to connect to the Cloud where Apple stores its data, where you really - it's very, very secure compared to, say, swiping your card. And there are even now situations, Terry, where people put fake swipers on top of swiping machines. And so you may be swiping it into the wrong place.

GROSS: Oh, stop (laughter).

TUROW: Yes. It's crazy. Particularly, in gas stations, this has happened.

GROSS: Really?

TUROW: Yes.

GROSS: So we were talking before about, like, loyalty programs, and there's almost, like, anti-loyalty programs where they want to seduce you to shop if you haven't been loyal or if you haven't shopped there before or haven't shopped there in a long time. So how do those programs work?

TUROW: Well, some companies that didn't want to be named told me that they will actually reward someone more if the person looks like she or he is leaving the store. If they track your shopping and you begin - they begin to see you not buying as much, they may send you better coupons than loyal people because they figure loyal people are going to be loyal. And so the prices may change to the betterment of people who are less loyal to some extent.

I've spoken to some people who use that. Some savvy people will, for example, buy something online, put the item in the cart. They won't purchase it yet. They will put the item in the cart and wait a couple of days, and then they find that the company will give them discounts in order to buy it.

GROSS: You say that facial recognition technology might be used soon by retailers.

TUROW: Yes. It's already used in Russia. It's interesting. There's a Russian company that actually puts facial recognition technology on the checkout area. And supposedly, the people who are checking you out can know who you are and based upon knowing who you are and a little bit of what you've bought and how you smile or don't smile in that moment decide to reinforce your purchase in some way giving you a discount or something.

GROSS: So how might it be used here?

TUROW: Well, you can easily see facial recognition technology, aside from security, to be used to know if it's really you or somebody in your family walking into a store so that a lot of times people will share credit cards or frequent shopper cards. This way, they'll know it's exactly you, and they will also know how you feel - whether you're smiling or not smiling when you pick up a product.

I went to a meeting about a year and a half ago where a person at this industry meeting was talking about people wearing implants in their arms. And the notion was that people he said - this was a person in a major consulting firm owned by a very big ad agency. He said that by 2028, 50 percent of Americans would have chips in their arms that when they walk down the aisle and pick up a product, the store will know based upon the relationship between the chip and the computers in the store at the time how you feel about the product whether you're nervous, whether you like the price or not based upon your physiological reactions. And then they might change the price based on that.

He went on to say that by about 2050, almost all of Americans would have such chips. Now, the funny thing about that - although it wasn't really funny, there must have been 50 people in the room - nobody laughed. Nobody said you're crazy. These were all people involved in retailing and what's called the Internet of Things as it relates to shopping. And no one said what are you talking about? There's so much confusion out there. There's so much competition out there that retailers are willing to think of a whole lot of things that seem outlandish.

GROSS: I'm trying to think how much of a discount I would want before having a chip implanted in my arm. An app seems a lot better.

TUROW: In comparison, certainly.

GROSS: In comparison, yeah. Do you think that's really going to happen?

TUROW: Not really. But I did hear - again this is odd stuff, but it - it's perfectly possible now - someone talking about how your lipstick could talk to you. The notion is that you will go into your bathroom with your phone on, presumably your app on, because you might not take it off. And it's from a particular cosmetics company. And the lipstick has an RFID on it that will communicate with your phone - a certain chip that communicates with your phone. That RFID communication will then tell - speak to the cloud. The cloud will then say, gee, it's certain kind of weather out there. Maybe you really ought to wear this type of lipstick as opposed to that type of lipstick, and it will come into your phone to tell you this.

GROSS: Wow (laughter).

TUROW: And people have told me this very straight-facedly. We're not talking about oddball comments. We're talking about the notion - see today...

GROSS: Why would a retailer need to tell you that?

TUROW: For loyalty. Again, the idea that you will supposedly want to have this, that you will really feel good about constant connection with a particular marketer and/or realtor. In this case, there's a company called Gartner that has been talking about where retailers should move, and they have four steps that retailers ought to be moving toward. And they call them sync me, see me, know me, beam me.

And sync me is the idea of syncing across devices. So we've been talking about the phone, but it's also your apps, on your tablet, and it's your TV set - we haven't even discussed that - or your desktop computer or your laptop computer. So that's sync me. Then see me, you know, as you move across the world from your home to the outside with geolocation to the inside the store and passing on information. It's quite possible to pass information on to what you did outside to the store and vice versa. I've had people tell me they're moving towards a situation where if you go and look at lawnmowers in a store and you stayed around there for say four or five minutes, and then you walk out, you haven't bought anything - a little bit later they will contract for someone to send you a message saying, gee, think about our lawnmowers.

So that's the idea of a see me across devices, and then know me as a result of this broad data collection that companies have buying data about you, keeping data about you and then in the end, the notion of beam me. In fancier terms it's called predictive analytics. Can I figure out what you're going to do next based upon everything I know about you? It reminds me of Eric Schmidt of Google saying at one point we want to know so much about you and know that you know that that when you think of what career you want to take, you will ask Google.

GROSS: My guest is Joseph Turow, author of the new book "The Aisles Have Eyes." We'll talk more after a break. Also Sarah Hepola will describe Valentine's Day from her perspective as someone who's spent most of her life single, and Kevin Whitehead will review a new collection of Count Basie broadcast recordings from 1938 to 1940. I'm Terry Gross, and this is FRESH AIR.

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GROSS: This is FRESH AIR. I'm Terry Gross back with Joseph Turow author of the new book "The Aisles Have Eyes." It's about how more and more retailers including supermarkets and pharmacies are using new digital technologies to track you while you're in the store and profile you as a consumer which may affect the price you pay. Turow is a professor of communication and associate dean for graduate studies at the Annenberg School for Communication at the University of Pennsylvania.

Another thing you write about is how some stores are selling, say, clothing with their own labels on it or products with their own labels on it. So if you decide, yeah, I like this sweater, or I like this, you know, whatever - you can't find it from another retailer for a cheaper price online because it's only this store that sells it.

TUROW: Yes. It's a really important thing for certain retailers. The idea goes back a century. I mean, Brooks Brothers has been selling Brooks Brothers stuff, only Brooks Brothers, for a long time. But you know what happened in 2011, which is fascinating? This is really what ignited the whole change in retailers' mentality.

In 2011, before Christmas, Amazon encouraged people to go into stores, take their phones and scan products. And what that was doing - and if you bought a product, that product, from Amazon, you would get a discount - but apart from doing that, what Amazon...

GROSS: To encourage you to buy online with Amazon, as opposed to in a brick-and-mortar store.

TUROW: Exactly. But apart from that, what Amazon was doing at that moment, it was getting prices for products all over the United States. It was cataloguing all the prices in stores across the country. And it was - it drove retailers crazy. And I would argue that's the moment where the retailing industry said, if we're brick-and-mortar, we have to become the internet in our stores. That's really the moment - that was the moment of truth for them.

Beforehand, they weren't sure where they wanted to go with this. There was a time in the late '90s, early 2000s where Macy's said, we don't know what to do with the Macy's online store. And they began saying, well, you know, the Macy's online store is for people who don't like to go to Macy's. Today it's very different. The two are interconnected.

GROSS: How?

TUROW: In the sense that what you buy online gets tracked by the store. They're hoping you will also go to the store, maybe to pick it up and buy other things. The store sees itself as very much a dual, multilocational place. And depending upon where you are, as long as you buy from Macy's, they're happy.

GROSS: OK. So like probably everybody else in the world, I do not read the privacy policies when I download an app, or get a new phone, or change my operating system or whatever. So do you read them?

TUROW: Yes.

GROSS: Because that's your - that's your job, is to know all this stuff, right?

TUROW: But I read them - It's getting to be a habit. Let me give you an example.

GROSS: Sure.

TUROW: Recently, I went to Washington, D.C., for a conference. And I got an email from the hotel chain that I have a relationship with, one of these frequent reward...

GROSS: (Laughter) I like the way you say that.

TUROW: Yes. And they said to me, we know you're coming to our hotel. Why do you want to check in? Just use the app. And if you go to the app, you can actually choose your room. You don't have to check in. And everything will be terrific. So I said to myself, well, I'm, you know, I'm a modern person. Maybe I should look at this. But first I read the...

GROSS: The privacy policy.

TUROW: ...Privacy policy, and it was unbelievable.

GROSS: What was in it?

TUROW: They said they have the right to look at all your data, buy information about you.

GROSS: Look at all what data?

TUROW: All - wherever you walk in the city, wherever you walk in the hotel, to follow what you're doing, to - they have a right to buy information about you, to trade information about you. And I said, I don't want this just for the ability to not check in. That takes five minutes. But the sense of being - saying to you, well, you can choose the room you want. For that, you're getting - you're essentially selling all your data, giving away all your data to the company that way. And so I just didn't do it.

GROSS: Now, could you understand the language that was telling you that?

TUROW: I have learned to understand the language.

GROSS: Would I have understood it?

TUROW: If you went further and further down into the policy, you might. A lot of euphemisms are used, a lot of broad language are used. They will say things like, oh, here's one that - this is not directly related to what we're talking about. But here's one that they'll always say. If you go - so a company, a supermarket - a supermarket will say, we do not sell your data to anybody. A little farther down - and that makes you feel good, right?

GROSS: Yeah.

TUROW: A little further down on the privacy policy, they will say, we may have advertisers put ads on our website when you get discounts and other things, or on our app. And when you do that - you should realize that if you click on them or do anything with them, the privacy policy is not our privacy policy. It's their privacy policy, OK. Well, to me, what that just said is everything they said before about not selling your information is untrue. A, they just sold a spot to an advertiser on the app. And the advertiser can know that you're there.

And if you interact with that advertiser in any way, they're going to know a lot more about you even then the fact that you've been there. So it is a contradiction to say that they don't sell your presence, that they don't sell information about you. They do. It's just in a different language. And you have to see this mangled sort of approach to policy-speak, privacy-policy speak.

GROSS: And you have to read the whole thing.

TUROW: Yeah. Because - and in fact, typically, privacy...

GROSS: Which we're not going to do.

TUROW: No one does. Statistically, very, very few people do. Many privacy policies start by saying we care about your privacy.

GROSS: Yes.

TUROW: You know. And then they go ahead, and they try to say how they really don't. More circumspect lawyers of privacy policies nowadays don't even say that. They say, we want you to know how we use your information. Please read this carefully. But I have spoken to lawyers who absolutely know that no one seriously can understand this stuff.

And even I - there are ellipses in the privacy policies, broad language that can take anything into account. And - like, we deal with businesses. We deal with marketers. I mean, you don't know exactly what they mean, whom they mean. These are just broad terms that will allow them to do virtually anything.

GROSS: Tell us something else you've learned by actually reading privacy policies.

TUROW: One of the things I've learned - what - what's shocking about a lot of privacy policies is how often companies say they have the right to follow you around outside the store and to actually trade - to buy data about you, that the stores actually will purchase data about you that then they add to the data that they have. And they also, more places than I would have thought, will say that they have the right to look online at what you say and can integrate that into what they are thinking about you.

GROSS: Do the people who write the privacy policies - and you might not be able to actually answer this - count on the fact that most people do not read the policies?

TUROW: I believe so. You know how I really know? Privacy policies are called privacy policies. We've done survey research over the years. And I have asked, I believe, five times of the American people - these are national surveys - true or false, when a website has a privacy policy, it means the site won't share your information with companies without your permission. More than half of Americans say the answer is true. And this is consistent. And a large percentage say they don't know.

So we have told the Federal Trade Commission - I have a number of times - say, well, if that's the case, if people think a privacy policy is like that and the policy in fact does share it, don't let them call it a privacy policy. Call it how we use your information.

GROSS: (Laughter) Right.

TUROW: And the fact is that that has not changed, which leads me to believe that companies very well know that the idea of privacy policy means people think that they are protecting their privacy.

GROSS: So if we're in a loyalty program or we've downloaded an app or a retailer's just learning about us through what we checkout through the barcode, where's the harm? I mean, so if merchandisers are learning about who we are and what our shopping patterns are, and maybe they're even selling that information to other advertisers or retailers, am I being hurt by that?

TUROW: I can answer that question on a number of levels.

GROSS: OK.

TUROW: Sometimes you might be hurt. So sometimes, for example, what you buy in non-prescription pharmaceuticals can be used together with what you buy in the store to profile you as to whether you're healthy or not healthy. And that may decide whether a company might send you an ad, say, for insurance or not, OK. Part of it may - so there are health issues. There may be - they may be noticing certain employment relationships that you can or cannot get based upon your purchases, believe it or not. But there are other issues here, too.

One issue I would argue is what I call information respect. In Europe, they call it dignity. You know, what is the situation where more and more we are allowing companies to simply profile us and treat us based upon ideas about us that we have no conception of. They're taking data about us, making these profiles and really having no notion - we have no notion of what they're doing. I think that, particularly when we're talking about hundreds of data points, buying it from a variety of vendors and then selling ideas about us, which may or may not be accurate, I think that's a big problem.

The third point is that what we're talking about as retailing surveillance is really just the beginning of the possibility of seeing people all over the place. I call this the hidden curriculum. What retailers are doing, whether they know it or not, is training us that to get along in the 21st century we have to give up data. People are arguing in the advertising industry about this, in the NSA and government surveillance about this. But on a daily basis, we're learning this, and maybe, over time, going to accept this as natural. The whole idea of data collection is to make it sound natural.

GROSS: Joseph Turow, pleasure to have you back on FRESH AIR. Thank you so much.

TUROW: Thank you, Terry. I really liked it.

GROSS: Joseph Turow is the author of the new book, "The Aisles Have Eyes." After a break, Kevin Whitehead will review a new collection of Count Basie broadcast recordings. And Sarah Hepola will tell us why Valentine's Day makes her blue. This is FRESH AIR. Transcript provided by NPR, Copyright NPR.