TIME Advertising

Facebook Takes Its Ad Game to the Rest of the Web

Facebook Privacy Flaw Exposes Private Photos
The Facebook logo is reflected in the eyeglasses of a user in San Francisco on Dec. 7, 2011. Bloomberg/Getty Images

In a challenge to online advertising leader Google

Facebook is set to share data on its millions of users with companies looking to sell targeted ads outside the company’s social network, taking its ad business to the rest of the Internet in a major challenge to Google.

The company on Monday will launch a new ad platform dubbed Atlas, through which it promises to deliver “people-based marketing,” especially mobile devices. The idea is to leverage Facebook’s vast troves of data on its users to deliver targeted demographics to advertisers and provide metrics on results. Facebook is already the second-largest advertising platform on the web.

“People spend more time on more devices than ever before, Erik Johnson, who is heading Atlas, wrote in a blog post Monday. “This shift in consumer behavior has had a profound impact on a consumer’s path to purchase, both online and in stores. And today’s technology for ad serving and measurement—cookies—are flawed when used alone. Cookies don’t work on mobile, are becoming less accurate in demographic targeting and can’t easily or accurately measure the customer purchase funnel across browsers and devices or into the offline world.

“People-based marketing solves these problems,” Johnson added.

Atlas has already signed up with the advertising giant Omnicom Group to test automated, targeted ads, starting with campaigns for Pepsi and Intel.

MONEY Food & Drink

7 Reasons Our Coffee Habit Is Costing More These Days

dollar sign made out of coffee beans
Andrew Unangst—Getty Images

In a relatively short period of time, the American coffee habit has gotten a lot more expensive.

Monday, September 29, is National Coffee Day, when restaurant and coffee chains around the country are giving out free (or extremely cheap) cups of Joe to the masses. The day is quite the exception, however, given how as a nation we are spending more and more on coffee.

Here are 7 reasons why:

We’re drinking coffee earlier in life. A study published this year by S&D Coffee & Tea shows that on average, younger millennials start drinking coffee at age 15, while older millennials picked up the habit at 17. Typical members of Gen X, meanwhile, started drinking coffee at 19.

More of us drink coffee regularly. U.S. coffee consumption rose 5% in 2013, according to a National Coffee Association survey, meaning that today 83% of the adult population drinks coffee; 75% have coffee at least once a week.

And we’re drinking higher-priced coffee at that. Data from 2014 shows that 34% of Americans drink gourmet coffee daily, an increase of 3% over last year. Young people in particular are willing to pay higher prices for coffee: In a new PayPal poll, 18% of people age 18 to 34 said they are willing to pay more than $3 per cup, compared with just 8% of those age 50 to 64.

We eat breakfast outside the home more often. Our fast-moving, on-the-go culture has been blamed as a reason for declining sales of cereal and milk, as more Americans are skipping the traditional breakfast at home and opting for foods that can be eaten on the run, like Pop Tarts and fast food via the drive-thru. In fact, breakfast has become enormously important to quick-serve restaurants because it’s the one mealtime experiencing strong growth lately. Coffee purchased at a restaurant or on the go at a convenience store or café is always more expensive than coffee brewed and drunk at home.

One word: Keurig. “In 2002, the average price of a coffee maker was about $35,” a recent post at the Northwestern Kellogg School of Management blog stated. “By 2013, that number had risen to around $90.” Truth be told, it’s still easy to find a coffee maker for $35 or even less, it’s just that the type of machine—the traditional kind that brews ground coffee by the pot—is no longer typical. It’s been replaced by the pricier single-cup brewer that came into the mainstream over the last decade thanks to the Keurig company. For many consumers, the speed and convenience of such machines outweighs the premium one must pay beyond the plain old-fashioned coffee maker. Some 1.7 million single-cup Keurig brewers were sold in the second quarter of 2014, an increase of 200,000 over the same period a year before.

Plus, K-Cups themselves are pricier. It’s not just the single-cup machines that cost more—the cups themselves do too. The price per single-serve K-Cup pod varies widely depending on the style of roast, whether you’re buying a small pack or stocking up in bulk, and how strategically you shop for deals. But no matter how good you are at snagging deals, you’ll almost always pay more for coffee pods than you will for old-fashioned ground or whole bean coffee. One price-comparison study conducted a couple of years ago indicated that K-Cup coffee cost more than $50 per pound, roughly four times the cost of a bag of Starbucks or Dunkin’ Donuts beans. What’s more, K-Cups are subject to a 9% across-the-board price hike in early November. (Side note: Mother Jones and others have pointed out that single-use K-Cups cost more and are worse for the environment than recyclable pod filters, though Keurig Green Mountain has plans to make all K-Cup pods fully recyclable by 2020.)

All coffee is simply getting more expensive. A long-lasting drought in Brazil (the world’s biggest producer of coffee beans) has pushed global coffee prices to near-record highs, and the market may be affected for years to come. Already this year, java junkies have faced price hikes from coffee brands such as Starbucks, Folgers, Maxwell House, and Dunkin’ Donuts. Interestingly, even as coffee has gotten more expensive and economic growth hasn’t exactly been sizzling in recent years, Starbucks sales have outpaced lower-priced competitors Dunkin’ Donuts and McDonald’s. What does that show us? For the most part, coffee lovers are passionate about their caffeinated beverages and aren’t going to trade down to what they view as an inferior cup of Joe, even if doing so would save a couple of bucks here and there.

TIME White House

Larry Summers: Obama and Clinton Are Very Different Bosses

The current president is a stickler for punctuality and order, the former Treasury Secretary tells the Nantucket Project. But Clinton? Not so much

“There are differences in working for President Clinton and President Obama,” said Larry Summers in a panel on global finance at the Nantucket Project on Sunday. Summers ought to know: he served as Secretary of the Treasury under the first and Director of the National Economic Council under the second.

“If you have a 10 o’clock meeting with President Obama,” he says, “you should be in your office at 10 minutes before 10, because he might be running early. If you have a 10 o’clock meeting with President Clinton, it’s really okay if you cruise in at 10:05, because he’s not going to be ready until 10:20.”

The differences in meeting styles go beyond punctuality, Summers continued: “If you’re meeting with President Obama, if it’s a 30-minute meeting, at 10:26 his assistant will bring him an index card telling him about this next meeting, and at 10:30, you will be gone. That 30-minute meeting you were supposed to have with President Clinton that was supposed to begin at 10 and actually began at 10:20? At 10:50, he is just warming up.”

Number 42 and Number 44 differ in their approach to meeting prep as well. If Summers gave Obama a memo in advance, he says, “the probability that he would have read the memo was 99.5 percent, and if you attempted to summarize the memo, he would politely but very firmly say, “Larry, I read the memo.” President Clinton? “He might have read the memo. He might not have read the memo. He kind of welcomed your summary.”

While Obama focused on making decisions based on the information his advisers presented, Clinton wasn’t afraid to give his advisers some food for thought. Doing an impression of sorts, Summers recalled the way he’d go off on a tangent: “Larry, you’re talking about the unbanked, people without bank accounts. There was a guy, great guy, used to be mayor of Memphis, he had a program going to help the unbanked—beautiful wife—ran for Congress, I don’t know what happened to him, great guy, you really should look into that program to use unemployed youth to install ATMs.”

Though one was more disciplined and the other more freeform, he said both were effective leaders by staying true to their own styles.

Summers also came to Obama’s defense in the forum when Meredith Whitney, the former stock analyst turned hedge fund manager who correctly predicted the subprime crisis in 2007, said that we’re now in a period of over-regulation.

If it’s really true that there’s a bureaucratic “war on corporations,” Summers asked, then “why is it that the market value as measured by the stock market of American corporate business has grown more rapidly in the five and a half years of this presidential administration than any other administration since 1932? … why is it that corporate profits as a share of our economy are larger than they have ever been before?”

“It’s just an odd kind of war in terms of the results.”

TIME Money

PayPal Co-Founder Takes Aim at Credit Card Industry With New Startup

Yelp Chairman Max Levchin Creates New Mobile Payments Startup Affirm
Max Levchin speaks during a Bloomberg West television interview in San Francisco on Thursday, March 28, 2013. David Paul Morris—Bloomberg / Getty Images

“You have to have a credit card. You have to use it. You are going to get screwed and you know it."

The most miserable year of Max Levchin’s life began in 2002, shortly after he sold off his ownership stake in PayPal to eBay for an estimated $34 million. “At the time, I had a fascination with the color yellow,” Levchin told TIME. He would arrive to work in a yellow car, wearing a yellow jumpsuit and hole up in his executive suite, blending in with the all-yellow office paraphernalia. His former direct reports, who numbered in the hundreds, shuffled past the door, “staring at me every morning,” he recalls, “as I would sort of mope around going, ‘My baby’s now been sold to a giant company’ while wearing a yellow clown suit.”

He was 27 years old, flush with cash and adrift in an ocean of downtime. If that sounds like your idea of heaven, then you’re no Levchin. “I literally — I think I started hearing voices,” he says. His girlfriend left him. He wrote 10,000 lines of code, a “minuscule amount,” he insists. His friend persuaded him to take a scenic drive along the Oregon coast. “We saw a lot of very beautiful places,” he says, “and I don’t remember any of it other than the fact that Oregon is a really messed up state, economically.”

Nothing could lift his spirits, short of launching another company, which he did in 2004. It was called Slide, and it was a fun ride down the chute toward another sale in 2010 to Google for $182 million, Levchin says.

Today, he knows better than to slip back into the interminable boredom of easy living. He’s in the thick of a third venture, Affirm, and to sop up the last waning moments of his spare time, he also oversees an investment fund called HVF, short for “Hard, Valuable and Fun.” “Fun” has a very peculiar definition in this case — referring to any massive, globe-spanning problem that Levchin might get to noodle over in his scrappy new office in downtown San Francisco.

Affirm’s 32 employees have set up shop on a quiet street lined by venerable brick buildings, some of which withstood the great fire and earthquake of 1906 and have the commemorative plaques to prove it. Here, Levchin is thriving in his element. His girlfriend came back. They got married and had two kids. He still favors the style of clothing that might diplomatically be called “start-up chic,” a puffy sleeveless winter vest, unzipped and revealing a weathered t-shirt that practically whispers, “I’ve got bigger things to worry about than shopping.”

In fact, though, he does worry about shopping. Obsessively. Levchin has been visiting retailers across the country, asking about the state of consumer lending. He sums it up grimly: “You have to have a credit card. You have to use it. You are going to get screwed and you know it.”

Millennials are ditching the plastic in droves. More than 6 in 10 of them say they have never signed up for a credit card, a group that has doubled in size since the financial collapse of 2007. Evidently they’d rather scrimp on their purchases than get snagged on finely printed fees or mired in debt. “Which is wrong,” Levchin says. “If you are living hand to mouth every month you’re not going to improve your standard of living and you’re not going to scale up.”

Enter Affirm, a startup that that offers consumers the option to split payments over time, which a growing number of online retailers have added to their checkout pages. Users can get instantly approved for a loan by tapping their personal phone numbers into Affirm’s welcome page. From that phone number Affirm launches into the murky world of online data. “It anchors you to a whole host of information that is entirely public, or pretty close to public,” says Levchin. It can scan for social information across social media or dip into proprietary marketing databases or combine that with credit histories. In total, the Affirm team has identified more than 70,000 personal qualities that it thinks could predict a user’s likelihood of paying back a loan. If old fashioned credit scores provide a fixed, black and white portrait of the borrower, Affirm claims to capture that borrower in full, moving technicolor.

The company is so confident in its claims that it puts its own money on the line, extending loans to people who are normally considered a risky gamble. Active duty soldiers, for instance, return home with scant credit histories. A raft of regulations require lenders to extend credit to the soldiers, even if the decision goes against their better judgement. As a result, lenders have historically eyed returning soldiers with suspicion.

“I couldn’t care less about the narrative of why that might be true,” Levchin says, “except that I know it’s actually not. From all the loans that we’ve issued I think we’ve had literally 100% repayment rate from active duty servicemen.” Of course, military service is just one of at least 70,000 variables that can tip Affirm in the user’s favor. The formula is complex by design, so that no user can game the system by, say, posting “brain surgeon” as a new job on LinkedIn and then requesting a fat line of credit.

Whether Affirm will truly upend the rules of lending or foolishly rushed in where lenders fear to tread will depend on its ability to collect interest on loans without resorting to hidden fees. After all, credit card companies do that for a reason: It’s lucrative. Affirm, on the other hand, actually alerts users to approaching payment deadlines and clearly states fee rates before they arrive.

In short, Affirm has to lend at the right rates to the right people. Fortunately for the company, it has $45 million of venture capital to test run its unified theory of lending. It also has no shortage of potential competitors circling in on the hotly contested field of smartphone payments, from Apple Pay, to Google, to Levchin’s old “baby,” PayPal, all competing for the same “under-serviced” customers, as he put it.

But perhaps Affirm’s greatest asset is Levchin himself, who was practically bred for this kind of work. His mother was a radiologist at a Soviet-era research institute, where she was tasked with extracting reliable measurements from Geiger counters. The old Soviet era instruments spewed out a tremendous amount of error data. Her manager dropped a computer on her desk and asked her to program her way to a more reliable reading. Stumped, she turned to her 11-year-old son and asked, ”Do you know anything about this stuff?” The question kicked off Levchin’s life-long love affair with programming, and it made him acutely aware of what data a machine can capture, and what essential points might elude its sensors. He points out that a heartbeat counter may measure 64 beats per minute, but it almost certainly misses a number of half-beats along the way. Affirm, in a sense, listens for those missed beats.

“The fact that we can look at data, pull it, and underwrite a loan for you in real-time is very valuable, because we can literally decide, ‘Hey, in the last 48 hours you got a new job, that changes things a little bit. Now you’re able to afford more,'” Levchin says.

Maybe that’s a hasty gamble, or maybe it’s sound financing. In either case, it’s Levchin’s idea of fun.

TIME

Stocks Rise at the End of a Rough Week; Nike Jumps

(NEW YORK) — The U.S. stock market bounced back Friday as investors welcomed good news on the U.S. economy at the end of a turbulent week of trading. Nike jumped after turning in higher profits, leading the Dow Jones industrial average higher.

KEEPING SCORE: The Dow was up 178 points, or 1.1 percent, to 17,124 as of 2:57 p.m. Eastern. The Standard & Poor’s 500 index rose 17 points, or 0.9 percent, to 1,983 and the Nasdaq composite climbed 46 points, or 1percent, to 4,512.

The S&P 500, the benchmark for most mutual funds, remains on track to lose 1 percent this week. The biggest drop came Thursday, the worst day for the stock market since July 31.

A VIEW: A steep drop one day is often followed by gains the next as investors hunt for beaten-down stocks. “After yesterday, it’s only normal to get a little bit back because people tend to buy on the dips,” said Jason Pride, director of investment strategy at Glenmede Trust.

Pride said he expects the market to resume its climb as the economy improves. “I think we’ll continue to grind higher because the economic momentum is still there,” he said. “Maybe the market gets overvalued. So, sometimes a little breather is helpful.”

SURPRISE: After a dismal winter, the U.S. economy expanded at an annual rate of 4.6 percent in the spring, the fastest pace in more than two years, the government reported Friday. Some economists expect the momentum to carry through the rest of the year.

SWOOSH: Late Thursday, Nike said its quarterly net income surged 23 percent thanks to solid sales and lower taxes. Both its earnings and revenue beat Wall Street’s estimates. Nike’s stock gained $9.68, or 12 percent, to $89.41, the largest gain among the 30 big companies in the Dow.

MOVING ON: Famed bond-fund manager Bill Gross, a founder of bond giant PIMCO, is leaving to join Janus Capital. Janus said Gross, who ran the world’s largest bond fund at PIMCO, starts work next Monday. Janus soared $4.17, or 38 percent, to $15.28.

CAJOLING: An investment fund with a stake in Yahoo sent a letter to Yahoo’s CEO urging the company to consider merging with AOL. Jeffrey Smith, who heads Starboard Value, wrote that a deal could save as much as $1 billion and create a more competitive company. Yahoo climbed $1.59, or 4 percent, to $40.53.

EUROPE: Major markets in Europe were mixed. Germany’s DAX slipped 0.2 percent and France’s CAC 40 gained 0.9 percent. Britain’s FTSE 100 index picked up 0.1 percent.

CURRENCIES: The dollar strengthened to 109.10 yen from 108.56 yen in late trading Thursday. The euro fell to $1.2729 from $1.2760.

BOND MARKET: Prices for U.S. government bonds fell, nudging yields up. The yield on the 10-year Treasury note rose to 2.54 percent from 2.50 percent late Thursday.

METALS: In commodity trading, precious and industrial metals made slight moves. The price of gold fell $6.50 to settle at $1,215.40 an ounce. Silver slipped 10 cents to $17.54 an ounce. Copper was little changed at $3.03 a pound.

OIL: Benchmark crude oil for November delivery rose $1.01 to $93.54 a barrel on the New York Mercantile exchange.

TIME Companies

Activist Investor Starboard Wants Yahoo to Consider Deal With AOL

Yahoo's Headquarters In Sunnyvale, California
A sign is posted in front of the Yahoo! headquarters on May 23, 2014 in Sunnyvale, California. Justin Sullivan—Getty Images

A combination of the two companies could result in cost synergies of up to $1 billion, the investor argues

Starboard Value LP has called on Yahoo’s management to consider a potential combination with AOL Inc., a deal the activist investor said could result in cost synergies of up to $1 billion.

In a letter addressed to Yahoo CEO Marissa Mayer, Starboard — which disclosed a “significant ownership stake” — argues Yahoo is “deeply undervalued relative to the sum of its parts.” The investor, which generated some headlines recently for criticizing Olive Garden’s breadsticks strategy, said a combination of Yahoo and AOL 3.46% could reduce the cost overlaps in their display advertising businesses, and cut both companies’ overhead costs.

“Importantly, we believe the combined entity would be able to more successfully navigate the ongoing industry changes, such as the growth of programmatic advertising and migration to mobile,” Starboard said.

A Yahoo 3.31% representative wasn’t immediately available to comment on Starboard’s letter.

Mayer, ranked 16th on Fortune’s Most Powerful Women in Business list, is facing pressure in the wake of Alibaba’s 0.31% initial public offering last week. At least three analysts have downgraded the company’s stock this week, citing the absence of a turnaround at Yahoo’s core business and limited upside to owning a slice of Alibaba. Yahoo still owns about 400 million shares of Alibaba, a stake worth more than $35 billion before taxes, The Wall Street Journal has reported.

Starboard’s move is also turning up the heat on Mayer to perform. Fortune earlier this year asked an important question: “Will Marissa Mayer save Yahoo?” noting that while the company’s stock value has climbed under Mayer’s tenure, the strength has had little to do with her turnaround efforts. While Yahoo has announced some high-profile acquisitions (including the $1.1 billion deal to buy Tumblr) the company’s ad business remains challenged.

Starboard points out that even after Yahoo’s “ill-timed and tax-inefficient” sale of Alibaba stock, the company’s remaining stake in Alibaba “is currently worth more than the entire enterprise value of Yahoo.” When adding in the company’s stake in Yahoo Japan, those two minority interests are worth about $11 billion, or $11 per share more than the current enterprise value of the company.

The activist investor claims the “valuation gap” is due to the fact that investors expect Yahoo management to continue past practices, including acquisitions at “massive valuations with seemingly little to no regard for profitability and return on capital.” Another problem, according to Starboard, is monetizing its non-core minority equity stakes in a tax-inefficient manner.

“We believe that Yahoo’s core business is valuable. However, given some recent operational challenges, we would expect it to trade at the low end of industry multiples,” Starboard said.

This article originally appeared on Fortune.com

TIME Family

CEO of Trillion-Dollar Company Resigned After His Daughter Told Him How Much He Has Missed

Key Speakers At The Bretton Woods Committee International Council Meeting
Mohamed El-Erian, chief economic advisor at Allianz SE, speaks during the 31st Annual Meeting of the Bretton Woods Committee at the World Bank Bloomberg—Bloomberg via Getty Images

Former PIMCO CEO Mohamed El-Erian's daughter made him a list of all the milestones he had missed

Updated Sept. 29, 6:12 pm

A 22-point list written by his 10-year-old daughter was all it took to change the trajectory of Mohamed El-Erian’s life, the former CEO says.

In January, El-Erian made headlines for announcing his resignation as chief executive officer of trillion-dollar investment fund PIMCO in January. In an article for Worth this summer, which has recently gone viral, El-Erian explains that he decided to step down after his daughter listed out the many milestones he had missed in her life.

When El-Erian asked his child why she wasn’t listening to him when he asked her to brush her teeth, she gave him a list of 22 things he had missed (from first soccer matches to Halloween parades) because of work.

“Talk about a wake-up call,” El-Erian writes. “I felt awful and got defensive: I had a good excuse for each missed event! Travel, important meetings, an urgent phone call, sudden to-dos… But it dawned on me that I was missing an infinitely more important point.”

Family may not have been the sole factor in his resignation, however; at least one report at the time suggested El-Erian’s departure might also have been motivated by an alleged falling-out with PIMCO co-founder Bill Gross, who left the company Friday.

But whatever El-Erian’s actual reason for leaving, his blog post still struck a nerve. While discussion of work-life balance is often discussed with women in the C-Suite, men are rarely asked whether or not they “have it all.”

But the conversation is now opening up. And this is largely because men are speaking out. For example, former CEO of MongoDB Max Schireson wrote a popular blog post about his decisions to step down from his position after he realized how much he was missing in his children’s lives.

A recent TIME article asked 7 C-Suite dads, many of whom were CEOs, to reflect on their struggles to maintain a strong work and family life. Intuit CEO Brad Smith recalled leaving his wife and newborn daughters the day after both of them were born for work trips. Since then he has learned that there are “crystal” and “rubber” moments — while you can bounce back from missing a few occasions, the crystal moments (graduations, weddings, births) should never be dropped.

Since resigning, El-Erian now manages “a portfolio of part time jobs” that provides more flexibility. (Meanwhile his former firm, PIMCO has run into some troubled waters.)

“I now alternate with my wife in waking up our daughter every morning, preparing her breakfast and driving her to school,” he said. “I’m also around much more often to pick her up after school and take her to activities. She and I are doing a lot of wonderful talking and sharing. We’ve even planned a holiday together, just the two of us.”

Read more:

CEO Dads Open Up About Balancing Fatherhood and Work

 

TIME Companies

BlackBerry Faces Steep Challenge as It Aims for Turnaround

The Blackberry Passport Blackberry

BlackBerry is hoping to improve its outlook with the launch of its 4.5-inch square-shaped Passport

BlackBerry Ltd. has had a busy week — it debuted a new smartphone called the Passport and reported a narrower quarterly loss. But do those rosy headlines suggest a turnaround is underway?

Not necessarily. The Canada-based company on Friday reported it recognized hardware revenue on about 2.1 million smartphones for the quarter ended Aug. 30, a tiny figure compared to the over 10 million smartphones Apple sold over the weekend after the debut of the iPhone 6 and iPhone 6 Plus. BlackBerry’s quarterly revenue plunged 42% to $916 million from the year-ago level.

And for those keeping score: back when Apple debuted its first iPhone in 2007, it took 74 days to ship its one millionth smartphone. BlackBerry managed to ship over 3 million devices in a quarter over roughly the same time period.

Of course, this reversal of fortunes isn’t a surprise. BlackBerry’s worldwide smartphone market share is under 1%, according to data from research firm International Data Corporation, far less than Apple’s hold on about 12% of the market. BlackBerry’s market share was a far more sturdy 13.6% just three years ago, signifying just how quickly things can turn sour for a smartphone maker when it falls out of favor.

BlackBerry is hoping to change all that with the launch of its 4.5-inch square-shaped Passport, touting the device’s larger screen and apps geared to professionals that have defected to other devices. As Fortune reported last month, BlackBerry is hoping government, finance and health care workers will find the device’s unorthodox dimensions ideal for their work.

The device is off to a fairly decent start, according to CNET, which reports 200,000 BlackBerry Passport smartphones have been ordered since launch.

Investors have bought into the BlackBerry turnaround story before, only to be burned later when reality set in. The company’s shares rose in the months leading up to the company’s launch of a new operating system, called BlackBerry 10, which was unveiled in 2013. Investors had placed a big bet that plan could work, sending BlackBerry’s [then known as Research in Motion] shares up 59% in the 12 months before issuing quarterly results in June. Disappointing sales of the Z10 phone resulted in shares tumbling some 28%.

This article originally appeared on Fortune.com

MONEY Shopping

The Creepy New Way Macy’s Tempts You to Make Impulse Purchases

A view of a Macy's flagship store in New York.
A view of a Macy's flagship store in New York. Bebeto Matthews—AP

Macy's is outfitting stores with the ability to detect shoppers' exact locations—and then make ads and coupons magically appear on smartphones so they'll buy the merchandise in front of them.

The Shopkick app was born as a combo rewards program and location-based coupon dispenser, in which users accumulated points (or “kicks”) for doing things such as activating the app inside stores, scanning barcodes of specific items, or merely walking inside a participating retailer location. The app works with tons of national retailers, including Best Buy, Sports Authority, J.C. Penney, and Macy’s and was a hot topic in the news a couple of years ago, when Target made Shopkick available for use in all of its stores around the country.

From the get-go, retail experts anticipated a time when such technology would be fine-tuned and pushed to the next level. Instead of the app displaying basic coupons and deals the moment the customer walks through the doors, more precise location-based offers and promotions would appear based on where the shopper is standing inside the store.

During the upcoming holiday shopping season, this futuristic vision of retailer marketing will arrive in a big way at Macy’s. The Washington Post reports that over the next few weeks, Macy’s is installing 4,000 special devices inside nearly 800 stores, with the purpose of detecting the exact location of shoppers—and then sending them special tempting offers accordingly.

The devices, developed by Apple, are called iBeacons, and some people have already described them as “creepy.” Macy’s began testing how Shopkick and iBeacons would work together during the 2013 holiday season. Apparently, the retailer was happy enough with the experiment to roll out the technology to all of its U.S. stores.

How exactly will the tech play out in a real-world situation? Say you’re “in the housewares department standing next to our display of KitchenAid mixers,” Macys.com president Kent Anderson explained. “The ability to transmit to you information — a video about the quality of this product, the accessories that we have as part of our assortment that you may not see there — rich content that may, and should, help us close the sale, is where we potentially see the beacon technology going in our stores.”

Presumably, if the mixer was on sale or part of some other promotion, that information would also appear on the smartphones of those using the Shopkick app. Macy’s says that “more personalized” offers—based perhaps on one’s history of purchasing or browsing in stores and online—could pop up as soon as next spring, though that may depend on how the new program plays out during the upcoming season and how welcoming (or not) shoppers are to the retailer using even more of their personal data.

Macy’s maintains that it will proceed cautiously concerning how often specific location-based ads and promotions will be sent to shoppers in stores. Going to that well too often could prove to be, quite literally, a turn-off in that shoppers could wind up turning off the app. “There is the opportunity to overload them” with special deals, Anderson said, “and I think that the balance has to be found.”

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