I’m a big fan of collecting frequent flyer miles and points. While the airlines and hotels have done their best to devalue the extreme opportunities that there once were, I believe that there still are some great deals to be had.
I just recently redeemed some miles for two international coach tickets for myself and my partner, which I’ve long thought is the best redemption for most people. I saved hundreds of dollars, and gained a ton of flexibility in the process.
At the same time that I am working to amass and spend frequent flyer miles, I’m going to the grocery store. There, I often see deals like “2 for 1” listed for “Club Members Only”.
“Do you have a membership with us?” the cashier asks.
“No,” I reply.
He will then ring up all of my purchases without any of those discounts. On my receipt will be a note saying how much I could have saved if I had been a member.
This might feel like an incongruity. Why would I work so hard to earn frequent flyer miles, which some might say have questionable utility and savings, while simultaneously avoiding free programs which have actual, tangible cost savings attached to them?
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Are you a product?
When you join a free club, it’s important to understand what the product is. What are they selling? How does the club benefit, and how do you benefit?
For example, Facebook, the bête noire of free clubs, uses demographic information that you willingly provide (through status updates and other activity) and then sells that to marketers, who make money by selling you things. With Facebook, you are the product that they are selling.
You benefit from Facebook by being able to keep in touch with everyone from your first-grade teacher to your spouse through the medium of a messaging platform and a public blogging system.
I don’t want to be the product that’s sold, so I don’t engage with Facebook.
Frequent flyer products
A frequent flyer program is designed to inspire loyalty. They offer you tokens that can be used to redeem for free or reduced price services (award travel). They, in turn, get more business, because you are incentivized to use their services, possibly even if alternatives are otherwise preferable (as in, if another airline is cheaper).
So with airlines, there is a direct financial incentive baked into the program. Sign up and you’ll get a financial benefit, and so will the organizers.
I have zero problem with this. Because they are after my money, and are incentivizing me to spend it, our relationship (me and the airline) is very clear.
Store loyalty products
Now, what about these store “club” programs, which are free to join and give you financial benefits?
There could be a loyalty aspect to it, because they believe that you’ll go to their store over other stores. I think that’s part of it, but not the whole story, because the savings don’t seem quite enough to inspire so much loyalty.
No, I think the other aspect that’s at play here is profiling. Meaning, that the store is building a profile of the products that you buy, and the times and places you go. As your membership number is required to give you those discounts, you’re giving them demographic information.
You may be familiar with a fascinating story from a few years back about a man who was incensed that Target was sending ads to his high school daughter about pregnancy products. He raged at Target, before realized that there had been “some activities” going on in the house that he hadn’t been aware of.
Basically, Target figured out that his daughter was pregnant before he did.
Now, there’s some dispute about how accurate this story is. But the larger point is still valid: companies are compiling a profile on what you do in their store.
And I don’t like that.
While some profiling is unavoidable, I do not wish to make it easy for companies to learn any more about me than they can.
With an airline, what could they possibly learn? Where I’ve traveled to? That I prefer a window seat? That’s not secret info. And I’m not getting a discount because I’m sharing this information.
What would they do with it? Sell my itinerary to marketers? “Guess what! This guy went to Dallas last year! And before that, he went to Las Vegas. And Hawaii. And Philadelphia.” Good luck trying to build a profile from all that.
But stores that offer cost savings and then build a profile, they have all the reason to store and sell my information. No thank you.
I want to be the customer, not the product. Don’t you?