A new investigation by Consumer Reports is raising concerns about what shoppers may be trading in exchange for their retail rewards. The report reveals that many loyalty programs operated by major retailers — including supermarket giant Kroger — collect and use extensive amounts of personal data, often without consumers fully realizing how their information is being shared or monetized.
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GLOA new investigation by Consumer Reports is raising concerns about what shoppers may be trading in exchange for their retail rewards. The report reveals that many loyalty programs operated by major retailers — including supermarket giant Kroger — collect and use extensive amounts of personal data, often without consumers fully realizing how their information is being shared or monetized.
According to the findings, while loyalty programs promise discounts, personalized coupons, and member-only perks, they also enable retailers to track shopping behavior, purchasing frequency, and even sensitive lifestyle indicatorsderived from buying patterns. This data is then used to fuel targeted marketing, influence pricing strategies, and, in some cases, shared with third-party advertisers.
Experts interviewed by Consumer Reports warn that these programs can effectively turn consumers’ everyday purchases into detailed digital profiles, raising questions about transparency, consent, and data security. The report also notes that the more consumers rely on app-based loyalty systems, the more information they may be handing over — from location tracking to payment preferences.
Kroger and other large chains maintain that their loyalty programs are designed to improve customer experiencesthrough personalized offers and savings, and that data is handled responsibly. However, consumer advocates argue that the true “price” of these perks may be privacy, as few shoppers read the fine print about how their data is collected or used.
“Loyalty programs are marketed as a win-win, but the reality is more complex,” the report states. “Shoppers are often paying with information, not just dollars.”
The investigation underscores a growing tension between personalization and privacy in the retail world. As companies expand their data-driven loyalty ecosystems, regulators and consumers alike are beginning to scrutinize what’s really behind those “member-only” benefits — and whether the trade-off is worth it.
Source: Consumer Reports / GLO
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