Howdy y'all, I wanted to share this illuminating piece on how your browsing habits and other data is now being used by companies to change pricing based on an enormous quantity of data points collected about you.
Deals from McDonald's regularly appear on this site, which is what made me think of sharing the article and posting an excerpt from the piece. A lot of you might know about this already and it's good you have your eyes open to this, but lots of people might be unaware of just how shady these business practices are.
"You might be aware that fast-food companies like McDonald’s have begun pushing customers to their app. Deals on the app are extremely good, at least for now: $1 breakfast sandwiches, 20 percent off any purchase above $5. That’s because McDonald’s, whose CEO has talked on earnings calls recently about a “street-fighting mentality” in winning customers, wants to burrow into phones, where they can access more personal data and get people hooked on an app where specific prices can be customized to the user.
What McDonald’s is doing is almost a throwback, kind of a high-tech loyalty card for the digital age. Worldwide, 150 million active members are now on the McDonald’s app, which is run by a company called Plexure that specializes in “personalized mobile engagement.” McDonald’s has a nearly 10 percent stake in Plexure, which also works with IKEA, 7-Eleven, White Castle, and more.
A Plexure slide presentation viewed by the Prospect stresses the power of customized engagement. It starts with using a cheap offer to entice users to purchase though the mobile app. After that, various factors go into the process of “deep personalization”: Time of day, food preferences, ordering habits, financial behaviors, location, weather, social interactions, and “relevance to key moments i.e. pay day.”
It doesn’t take much brainpower to devise ways to exploit this data. If the app knows you get paid every other Friday, it can make your meal deal $4.59 instead of $3.99 when you have more money in your pocket. If it knows you usually grab an Egg McMuffin before class on Wednesday, or that you always only have an hour to eat dinner between your first and second job, it can increase the price on that promotion. If it knows it’s cold out, it can raise the price of hot coffee; on a scorcher, it can up the price of a McFlurry. And the app gets smarter as you agree to or turn down those offers in real time.
It doesn’t sound like much, but with 300 million customer interactions across its range of apps every day, Plexure can magnify tiny price shifts into real money. The company promises that using its app strategy will increase frequency of orders by 30 percent and the size of orders by 35 percent."
It's an alarming read, but better to know than remain in the dark. Cheers.
Technofeudalism - it's a real thing, and more pervasive than anything ever.