Evan Schuman's StorefrontBacktalk

For social data-mining, there are three relevant categories. One: All Aggregate. This approach, which is similar to the one Wal-Mart paid some $300 million for when it bought Kosmix last week, offers various reviews about how well Kosmix can handle massive social media data-crunching accuracy. It is the safest approach for avoiding privacy backlash, and it also gives good overall emotional reactions to products. Think of it as the world’s largest focus group, with all the pluses and minuses of that research magnified by several orders of magnitude.

Two: Automatic Opt-In. This includes communications that customers and prospects engage in with your brand willingly and deliberately, such as direct E-mails, text messages, help-desk calls, tracked Web site usage, etc. A little bit of privacy pushback, but most consumers today assume this is already happening. (Ahhhh, they have far too much faith in retail corporate IT budget generosity.) It is a very accurate technique, but it’s not really social data-crunching.

Three: USELT, which stands for Unlimited Scope, Extremely Limited Target. This is the nuclear-powered privacy powder-keg. It’s also the ultimate in CRM. This approach is where spiders search everywhere in social media, reading every blog post and comment, Facebook notation, Twitter tweet, LinkedIn update, iTunes song selection and YouTube video diary entry. And those spiders are on a mission to find entries relating to specific existing customers and specific customer prospects.

What if a chain wanted to limit its coupons to customers who wouldn’t otherwise make a purchase? What if it searched for customers who had just been laid-off, so they could be sent the coupons? Even worse, what if it sought customers who had just gotten raises or big bonuses to make sure that those customers did not get a coupon?

The idea of trying to detect a consumer’s mood for pricing strategy is not new, but this type of social network data-mining could make it practical in a way that it never really was. A spokesperson for Attensity said the software absolutely can jump into the sensitive USELT arena. Should retailers go there? That’s a much more complex question than it seems.

Ultimately—say, in about eight years—this won’t be much of an issue. Consumers will accept it. If they want to remain anonymous, there are ways today to do so and there will be far more such options in the coming years. But near-term, that’s very different. The information would be fabulous, and it could address improving margins beyond just improving revenue. If customers in 2011 even think that their favorite chain is doing this to them, the damage could be irreversible.