Using algorithms, the company not only records purchase history, but also predicts future behavior, financial costs, and the likelihood of customer churn with high accuracy.
Using algorithms, the company not only records purchase history, but also predicts future behavior, financial costs, and the likelihood of customer churn with high accuracy.
The scale of corporate data collection was reported by Wired journalist Rhys Rogers, who exercised his legal right to access personal data and received a 515-page report from the company.
Rogers said he downloaded the app for the discounts, with an understanding of the basic level of tracking of his data. However, the resulting document turned out to be much deeper. The report contained not only a history of transactions with time and geolocation (for example, 61 visits to San Francisco), but also the results of predictive algorithms.
Analyzing the data, McDonald's calculated that over the next six weeks the user would visit the restaurant exactly 2.16 times and spend $29.15. The algorithm also identified the customer's favorite product, a large Diet Coke, and assigned behavioral patterns such as "lunch on the go in a hurry" and "afternoon snack." Of particular note was the attrition likelihood, which the algorithm estimated at zero, effectively identifying Rogers as a lifelong consumer of the brand.
Privacy experts interviewed by the publication note that this level of detail is standard for large corporations in the United States. Jeff Chester, executive director of the Center for Digital Democracy, bluntly called the practice “commercial surveillance.”
In turn, University of Washington professor Ryan Kalo drew attention to the technological imbalance between the consumer and the corporation. According to him, the customer is in a company ecosystem where entire teams of specialists design algorithms to maximize profits, turning loyalty programs into a tool for long-term surveillance.
McDonald's representatives, in response to a journalist's request, stated that they take privacy seriously and use purchase history only to provide a more personalized customer experience, including to provide relevant offers. After reviewing the document, the journalist sent a request to completely delete his data from the company's system.
