Fifty-seven per cent of New Zealanders say they are worried about invasion of privacy through new technology. In the United States—probably for good reason—the figure is 70 per cent, and in Australia 64 per cent.

Privacy advocates would say we are too complacent: everyone with an email account and a credit card should be worried. But assistant privacy commissioner Katrine Evans says it isn’t the technology we should be concerned about.

“Technology itself is neutral,” she says. “It’s what we do with it.”

And what can be done with it, using just a few snippets of information, is astounding. Latanya Sweeney, a data-privacy researcher at Carnegie Mellon University, found that 87 per cent of Americans can be identified through nothing more than their date of birth, gender and five-digit postcode.

Consider this. Every time you make a telephone call, purchase something using a credit card, subscribe to a magazine or pay your taxes, a little parcel of information that can be linked to you goes into a database somewhere. Every electronic transaction, every email, every phone call leaves a mark. Like snails, we leave a trail behind us. It may be invisible but it’s almost impossible to erase.

We do it without thinking. Just surf the web, send an email, register a car, use a supermarket loyalty card, buy a house, go to the doctor...

On their own, these packages of data reveal little. But put them together and you can develop a data profile that is extremely valuable to people who want to sell us stuff. In the US, where direct-marketing campaigns account for about three-quarters of a billion dollars in sales each year, the personal-data industry is booming. One company, Donnelly Marketing, keeps dossiers on 90 per cent of American households.

In New Zealand, loyalty schemes like Fly Buys or Progressive Supermarket’s One Card allow companies to collect information such as name, address and date of birth and correlate it with buying patterns.

Companies can use a method called data mining to profile a card-holder and forecast their response to special offers. This allows offers to be targeted at the people most likely to take them up.

University of Waikato professor of marketing Richard Varey says, “Once an electronic connection is established, every move is recorded and trackable.”

One often-quoted example is of a US grocery chain that used data mining to analyse local buying patterns. It discovered that when men bought nappies on Thursdays and Saturdays, they also tended to buy beer. Retailers could use this information to increase revenue by moving their beer closer to their nappies and making sure beer and nappies were sold at full price on Thursdays and Saturdays.

“Tracking and analysis of shopping behaviour, linked to time, place and activity, is now commonplace,” Varey says. Marketing planners look at what a person purchases, and in what combinations, to draw conclusions about their lifestyle. They can time offers to match birthdays, weddings or anniversaries.

“This is way more sophisticated than simple revenue or profitability measurement—and the customer is no longer anonymous to the supplier,” Varey continues. “Communication via email, SMS [Short Message Service, i.e. texting], etc. is now almost costless, and endlessly personalisable, avoiding the waste of large-scale broadcast advertising. The benefit to sellers is obvious.”

As Massey University marketing professor Ben Healey explains: “There’s an old adage that says half of your advertising money is wasted, but you don’t know which half.” By targeting offers, marketers can reduce such waste.

Companies that collect information about customers normally have a privacy policy according to which they promise not to pass personal information on to a third party. Healey thinks there is a strong incentive for companies to stick to this policy.