Evan Schuman's StorefrontBacktalk

The customer eats at this competitor’s restaurant at least a couple of times a week (in many cases, a couple of times a day). His average transaction is $7.25. He has also download dozens of iPhone apps in the last month, likes music by Norah Jones and rents mostly dramas on Netflix. I also notice that this person spends about $65 every couple of weeks at an Ethiopian restaurant. There is even a picture of this person, so I know what he looks like.

I’m “just the IT guy,” but that seems like some pretty nice information about my competitor’s business and about one of its most active customers. It seems like this information could be used to improve a company’s positioning with its competitors. But, more importantly, are your competitors using the information to better maneuver themselves around your business?

When I brought this question to Joel Bulger, the vice president of Marketing at Moe’s Southwest Grill, he said: “I guess what I’m not getting is, what is in it for the user to sign up? I don’t see any sort of ‘carrot.’ With the cost of getting consumer purchase information/patterns at an all-time high for marketers, I’m not sure why people would volunteer their information without any sort of compensation.”

As Facebook Founder Mark Zuckerberg has been quoted saying: “Privacy is no longer a social norm.” The same people who are OK posting pictures and videos of their drunken weekend on Facebook for the world to see (even their current or potential employers) don’t feel that it’s a big deal to share their purchases. In fact, it’s quite the contrary: They want their friends to know exactly what they’re buying, and they want their friends to reciprocate. It’s a form of social intimacy that might be akin to swapping private stories with your buddies at a neighborhood bar.

I also don’t believe that people think about the possibility of marketers looking at this information. Rather, I think many people are using this service as sort of a brag book for their friends. Some observers have suggested that people might use the Blippy site to set up false personas, potentially to impress people. Some guy might, for example, invite a woman he’s interested in to join his circle. He then uses his Blippy Card to buy an expensive suit, Mercedes-Benz keychains, The Vegetarian’s Guide To Improving The Planet’s Ecology and Why Women Really Should Be On A Pedestal. Meanwhile, he’d use another card or cash to buy fast-food hamburgers, cigarettes, cheap beer and porn.

I am surprised at how little attention this approach has generated with retailers. If Blippy does take off, retailers are going to have to learn to deal with what has traditionally been closely held information becoming widely available. I think that gut reactions will be along the lines of, “How can I get this shut off?” or “Who gave the credit card companies permission to provide my data?”

But let’s not forget that one of the site’s original goals is for people to share with their friends what they like and what they purchase. One person in a circle of friends who makes a purchase from a retailer may persuade dozens of other people to make a purchase from the same place. So each Blippy purchase is essentially a mini-endorsement for your brand. More importantly, this endorsement is coming from people who consumers trust–namely, their friends.

It remains to be seen whether Blippy will become a huge success or crash and burn. Arguably, the amount of data on the site is currently small. Some retailers may only have a dozen or so transactions, while others have hundreds or thousands. Obviously, smaller sample sets do not provide significant insight into a company. But if this site continues to grow, so will the value of the data it holds.

What do you think? Love it or hate it, I’d love to gain some additional perspectives. Leave a comment, or E-mail me at Todd.Michaud@FranchiseIT.org.