retail news in context, analysis with attitude

MNB took note early this week of a Boston Globe report on how technology may be changing the insurance business, with "more than a dozen insurers, seeking better ways to reward safe drivers and weed out riskier ones, are testing or marketing technologies to monitor driving habits, betting that customers are willing to give up privacy for the promise of lower bills." Essentially, what they are doing is "offering drivers a tantalizing deal: Sharply lower rates in exchange for permission to install a device that tracks when, where, or how you drive."

I noted that there are some privacy advocates concerned about this development, and that I certainly think that it seems possible that insurance companies, if they don't require such monitoring, could impose a financial penalty on those who will not allow their driving habits to be tracked.

And then ... maybe they'll put weight sensors underneath the driver's seat, so they can tell how heavy the driver is, and then charge them more for health insurance...

One MNB reader responded:

Read the leader regarding insurance companies and the car dongles that are being used to negotiate rates and also happen to be sparking privacy concerns.  First scenario that popped into my mind?  It's only a matter of time until we can just toss those privacy concerns out the window (of the moving car).  Most new cars have fancy in-dash systems replete with amazing displays and GPS systems.  I suspect that fancy advertisements based upon my location, time of day, and driving habits (how often I stop at Papa Geno's Cheesesteaks, etc.) will soon be popping up on the dash.  Touts for the tough, smart lawyer when my air bag deploys, ads from the local PD when I start to regularly exceed the speed limit, flower shops on my anniversary...

From another reader:

As people accept the recording devices promoted by the insurance companies, policies will start changing too.  The insurance companies are going to use the driver data to deny claims.  If the speed limit is 65 and the installed recording device says that you were traveling 66 at any time in the vicinity of when the accident occurred, they’ll just deny the claim.

Still another MNB user chimed in:

I thought I would comment on what you said at the end of your article about health insurance companies getting your weight from car seats. My health insurance actually  does what they call “health screenings” in order to find out everyone’s condition. You can decline, but then you pay a higher premium each month. They check your BMI, cholesterol and blood pressure which help you set “health goals” for the year that they monitor the progress of. You can either talk with a health coach each month, or participate in activates to quit smoking or focus on other areas that they  or you feel you are lacking in. I hate it, and I am actually in pretty good health. Last year, I had cold medicine the day of the screening which falsely raised my blood pressure that day. I paid for it by having to talk with a coach every month and track my fruit consumption daily for months.  I understand the reasoning behind it but it is really an adjustment to the way things were even a couple years ago.

On the subject of GMO labeling, MNB user Stephanie Steiner wrote:

Consumers want it – we, as an industry, need to stop shutting down their demand – or worse, telling them their demand isn’t valid.  It is valid.

We noted yesterday a story in USA Today about the continuing debate over the health benefits of milk: "While some consider milk a nutritional powerhouse, others see it as unnecessary for good health and question the rationale behind some government-related programs that try to help the marketing of milk."

One MNB user responded:

Why is there a debate over every conceivable subject? If you want to drink milk, do so. If not, not. Why do these self-absorbed egotists insist on inflicting their moral, political, social, cultural and generational views on others, who are neither interested nor care? Are they compensating for something missing from their drab, meaningless lives?

That seems so harsh ... it seems to me that this is a worthwhile debate, especially if our tax dollars are being used to subsidize the industry.

Besides, there are plenty of MNB users who have opinions ... and they are not people with drab, meaningless lives.

One MNB user wrote:

I had to laugh at the notion that milk is worth subsidizing in part because it is “an easy source of hydration”… come on, if you consider what dairy farmers have to go through in terms of feed, irrigation, hormone treatments to increase milk production, antibiotics to treat the infections caused by the increased milk production, breeding, waste removal, sanitation, refrigeration, transportation …. is it really easier than drinking water for hydration?

From another reader:

Simply put:  Milk is for baby animals.  We humans are the only animals that once weaned, continue to drink milk; which by the way is designed by nature for baby cows.

And from another:

The arguments pro and con regarding the consumption of cow's milk by humans always fascinate me. As one of those Mediterranean types with lactose intolerance, I have avoided milk for most of my adult life. Now well into my sixties, I have low blood pressure, no osteoporosis, and no health issues that require medication. I take no supplements or pills. When a dietitian tells me I need to drink milk for calcium, I have one question: Where does the cow get all the calcium that it puts into its daily output of milk? It sure as heck is not drinking milk.

On another subject - Amazon collecting sales taxes - one MNB user wrote:

Kevin - re today's note on the impact (or lack thereof) on Amazon's sales after they started collecting sales tax in Texas.  Your key point that there is a lot more to the Amazon customer proposition than a tax advantage is correct, and I don't think anyone would disagree in principle.  

But to claim that "there are many (retailers) who clung to the desperate hope that once Amazon starts collecting state sales taxes, it would lose all or most of its differential advantages and plummet to earth, leaving just a broken carcass to be ravaged and picked apart by bricks-and-mortar competitors" - really?  I know you're trying to make a point, but the tone of "you guys are all too stupid to understand this no matter how often I tell you" is beneath you.  Do you truly believe that there are "many" retailers out there who think that the only thing going for Amazon is a 4-7% sales tax advantage?  And while few people may have said "lack of sales tax" was a key reason for shopping at Amazon, I bet many of them said "lower prices" - part (but  certainly not all) of which comes from the 4-7% sales tax advantage - I wouldn't have expected the customers to portion out what part of the overall lower price came from taxes vs. other factors.

Having worked in retail for 25+ years and having seen the extent to which customers will switch stores to save a dollar or two, it's hard for me to believe that a 4-7% advantage has no impact whatsoever - "not the only thing" and "nothing" are not synonymous.

I only wrote the thing about some retailers believing that sales tax collection would eliminate Amazon's advantage because that's what I've heard from a number of retailers, both when I'm out giving speeches and in emails sent to me here.

I certainly wasn't suggesting that anyone is stupid. But I do think there is a certain amount of denial out there...
KC's View: