MasterCard is debuting an online shopping site, MasterCard Marketplace, which breaks new ground as a card company tries to sell directly to end consumers. To date, they’ve only offered products directly as an option for redeeming reward points. According to the New York Times, MasterCard claims that it “can pinpoint with considerable accuracy what its cardholders are likely to purchase.”
The new Marketplace is intriguing: might the card company displace some traditional retailers? It’s not likely that they will pursue that aggressively as it is in part by aggregating data across “thousands of retailers” using technology developed by Next Jump, a firm that monitors consumers behavior as they shop, that the site can drive personalization. Antagonizing traditional retailers would provide an opening that American Express and other competitors would be sure to exploit. I think it is more like a manufacturer opening a concept store: a chance to interact and learn directly from consumers, try out new products or features in a controlled environment, and exert control over how certain offerings are brought forward — all so that the broader business can be built.
Also, retailers represent many of the brands offered on the site so this is augmenting the card’s relationship with retailers and, I suspect, an attempt to have more purchases made with MasterCard than another card by offering special offers and an exclusive online storefront.
This large data set, if it is as impressive as it seems, is an analyst’s dream. Marry that cavalcade of bits and bytes with the chance to measure every move a consumer makes on the site in real time and you have a laboratory that could yield a treasure trove of insights. Next Jump claims that it can get results far above average – converting one-in-11 browsers into buyers for their clients.
I’m impressed that the site actually asks consumers to supply some information such as some of the merchants they like best. I’ve long been an advocate of bringing the consumer more deeply into the process: stop guessing and start knowing. I like the idea of dynamic profiling – let a consumer raise her hand when she’s about to redo her kitchen and put it down again when the project is complete – as a way to enable more accurate targeting, increase response rates, and decrease waste. This site doesn’t go that far but it is a start.
All of this tracking and analysis has raised the concern of privacy advocates. However visiting the site is purely voluntary and consumers tend to worry less about sharing their data when the result is increased value and a better shopping experience. MasterCard says that it will be scrupulous in ensuring customer privacy, of course, and only time will tell.
I signed up at the site to try it for myself (the last time I tried a trick like this I wound up in a record club for about a decade — uh oh). Aside from basic registration information, all other personalization is voluntary. I will follow the site over the next few weeks and report back on how well the personalization works.
This will be an interesting experiment to watch. What do you think?