MasterCard to sell card use data to retailers

Posted by Jessica Searle in Personal Finance on 1 March 2013 - Jessica worked as a Credit Analyst at checkmyfile until 2013

As larger commercial businesses are looking to diversify in an ever-competitive business market, MasterCard has recently realised the opportunities available with the data it can collate through your use of its cards.

A division of the company, MasterCard Advisor (MA), has announced a new partnership with analytics firm Mu Sigma. It aims to provide a combination of MA's aggregated and anonymous purchase behaviour and Mu Sigma's analytical expertise to companies in the retail market.

Retailers are able to search their own records to understand what their customers buy, but are currently unable to predict the customers overall shopping habits. With 1.8 billion people using MasterCards in over 34 million stores worldwide, it is this gap in the information market which this partnership aims to fill – a market already estimated to be worth around $5 billion.

“The data analytics market is rapidly growing as customers seek real time insight allowing them to better connect with their consumers through highly relevant products, offers and services,” says Gary Kearns, Executive Vice President, Information Services for MasterCard Advisors. “We went through an extensive process to choose the right partner and Mu Sigma’s innovation labs and capabilities make them stand out as best-in-class in this field. By combining MasterCard Advisors’ purchase behaviour insights with Mu Sigma’s expertise we will be able to drive faster innovations in data analytics solutions and deliver them on a broader scale, globally.”

MasterCard has confirmed, for the benefit of all of us data-protection fanatics, that the information to be sold will not contain any personal information, but instead will be an anonymous report and insight into the buying habits of its customers.

Products include benchmarking reports (how is my business performing compared to other merchants?), and analytics (how can I better understand what my customers might want to purchase?), for which there is no need for transaction details to be included.

Information can also be sector specific, for example the statistics each week regarding the sales of women’s clothing can help a retailer to benchmark its performance, and what products will sell well, or not so well.

Gary Kearns has described part of the service as giving a large retailer the ability “to understand, at an aggregated and anonymous level, what its customers do before and after they shop there. This large retailer would then be able to offer its customers certain incentives to come to its store and spend more on the items that they may have purchased before and after visiting them.”

The information available to be purchased by companies will not contain any personal information.. It will also not specify any purchases you make as an individual.

It will instead be aggregation of information from many consumers. If the product is one you already consume you might be able to obtain a better deal, or alternatively you can always say 'no'.

The end release of data is ultimately very general in nature and can have positive effects for both the company and customers alike.

MasterCard will simply by 'recycling' the information it already gathers when you utilise one of its products, although it can be assumed that many campaigners will still not agree with this point of view.

Jessica Searle is a Credit Analyst at checkmyfile and has a degree in English Literature from the University of Exeter. You can contact her at jessica.searle@checkmyfile.com

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