Angels and Demons: Profiling Customers for Fun and Profit

From product management to customer management

With the proliferation of data about customers on an individual level due to technology such as cookies, web bugs, and RFID (ie Spychips), companies have discovered a more valuable way to manage their assets. Customer profiling.

A new customer management policy has grown popularity in the business world which assigns customers the ominous labels of Angel and Demon.

Angels

This plesant sounding label belongs to a customer who doesn't comparison shop, buys high-margin items, always picks up "extras" (such as extended warranties and accessories), uses store credit, etc. Basically, anyone who brings the store profit.

Demons

Have you ever bought something on sale? Did you ever force a store to honor their own mis-marked product? Did you avoid their credit? Do you use coupons? Do you make them price-match other stores? Do you avoid add-ons and warranties? Have you returned an item? Have you called customer service?

These and other similar activities cost stores money. When a customer, such as myself, uses every reasonable advantage available, you can get a very good deal consistently, but soon it may cost you.

Customer reports

If you think the credit reporting industry is a sham as I do, wait till they start compiling customer reports.

Imagine a point system, where every purchase made was given positive or negative points based on profitability. Now imagine that any interaction with that same customer could be tallied into your profile based on how much time and resources they need to spend on you. Here might be some examples of negative point generating activities:

• Submitting a rebate
• Using your extended service plan
• Making any purchase without a certain percentage of high margin accessories
• Refusal to buy add-on services (such as a free Internet trial or movies-by-mail)
• Spending an over-average amount of time making the purchase decision
• Refusing to be upsold into a higher-end model than the advertised model
• Complaining about the store to management, to consumer watchdogs, or government agencies

After compiling the results of your score, you may be offered terms of credit, pricing, or specials based on that score. For example, "Special price for our 'Platinum' grade customers only!" Hmmm, I wonder who rates platinum? Another example might be putting better customers in a priority queue for customer service by phone.

As yet, there's no company I know that has progressed fully to this point, but the system is in place and some are dabbling. Every company that you have an account with can easily attach your account to service screens where a constant stream of information about you can be entered each time you enter the store, make purchases, or call customer service.