How companies learn your secrets and predict your next purchase

We knew that if we could identify [expecting mothers] in their second trimester, there’s a good chance we could capture them for years,” Pole told me. “As soon as we get them buying diapers from us, they’re going to start buying everything else too. If you’re rushing through the store, looking for bottles, and you pass orange juice, you’ll grab a carton. Oh, and there’s that new DVD I want. Soon, you’ll be buying cereal and paper towels from us, and keep coming back…Almost every major retailer, from grocery chains to investment banks to the U.S. Postal Service, has a “predictive analytics” department devoted to understanding not just consumers’ shopping habits but also their personal habits, so as to more efficiently market to them. “But Target has always been one of the smartest at this,” says Eric Siegel, a consultant and the chairman of a conference called Predictive Analytics World. “We’re living through a golden age of behavioral research. It’s amazing how much we can figure out about how people think now.

Picture walking into your local deli, and the owner recognizing you. Before you make it to the counter, the cook makes your “usual” sandwich, passes it to the cashier, who then bags it and hands it to you. All this with nothing more than pleasantries being exchanged. Now what if the deli was in a Target?

Well these days companies are trying to use predictive analysis to duplicate that process. But, of course, with all the Google and Facebook privacy concerns and horror stories of Target knowing a teen is pregnant before her parents, companies will have to think twice about what they do with all the info users are sharing with them. This’ll be an interesting space to watch going forward, and if you’re a marketer or a math nerd, opportunities abound.