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Are Apple AirTags Too Risky?

12/19/2021

by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

Most of us played ‘tag’ as a kid and loved the simple thrill of chasing others around and trying not to get tagged. Thanks to Apple’s advanced tech, the game has graduated to adulthood; however, criminals are increasingly “it, ” and the stakes are much higher for those being chased.

So, if you’re wondering what to buy for that childhood friend-turned-felon this holiday season, Apple has the perfect present: AirTags--The gift that keeps on taking. This dark humor aims to underscore some disturbing news: More criminals are finding that AirTags are a convenient way to pilfer the valuable property of others or even worse, to stalk people.

Apple introduced the small electronic tracking devices this past April to help individuals more easily locate products they’re apt to misplace like keys and bags. The company’s website explains how the 1.26” diameter tags work:

“Your AirTag sends out a secure Bluetooth signal that can be detected by nearby devices in the Find My network. These devices send the location of your AirTag to iCloud — then you can go to the Find My app and see it on a map.”

Given that this location system leverages a vast network of strangers’ devices, Apple has made privacy a top priority. The company ensures that only the AirTag’s owner can see where their AirTag is, and its location data and history, which are always encrypted, “are never stored on the AirTag itself.”

These measures appear effective in protecting the property owner, i.e., the person who places the AirTag on their own phone, in their own bag, etc.; however, it seems that a major security risk remains, namely preventing those with ignoble intentions from attaching AirTags to the possessions of others.

Of course, most people would notice if an AirTag inexplicably appeared on their coat or keychain, but they’d probably never see one affixed to the underside of their automobile. Unfortunately, it didn’t take long for car thieves to realize AirTags’ wonderful potential for pilfering.

Various news media have reported the troubling trend in which thieves see sought-after vehicles in public places like mall parking lots, attach an AirTag to the car in an inconspicuous spot, and track the vehicle to a more private place, like the owner’s driveway, where it can be stolen more easily.

The notion of ‘auto theft made simple’ is disconcerting, but even more disturbing is the idea that criminals could use AirTags to stalk people. What if you’re in a public place and someone inconspicuously slides one into a bag you’re carrying? The wrongdoer could show up at your home anytime.

Fortunately, Apple claims there are measures to thwart such chilling contingencies; its website explains:

“AirTag is designed to discourage unwanted tracking. If someone else’s AirTag finds its way into your stuff, your iPhone will notice it’s traveling with you and send you an alert. After a while, if you still haven’t found it, the AirTag will start playing a sound to let you know it’s there. Of course, if you happen to be with a friend who has an AirTag, or on a train with a whole bunch of people with AirTag, don’t worry. These alerts are triggered only when an AirTag is separated from its owner.”

These precautions do help ally some concerns; yet, a few questions remain, for example:

What if the person who’s unknowingly been ‘tagged’ doesn’t own an iPhone or have it with them, in which case they wouldn’t receive the alert?
How long does it take for the alert to be triggered?
How far does an AirTag need to be from its owner in order for the alert to be sent?

In keeping with the last question, if a person has an AirTag in a key chain that she hangs in a first-floor entryway, she won’t want an alert to sound each time she takes her iPhone to her second-floor bedroom. All this to say, AirTags’ security features give some significant reasons for pause.

Geoffrey Fowler, a columnist for the Washington Post, substantiated such concerns when he asked a colleague to pretend to stalk him for a week “from across San Francisco Bay.” He found that it took three days for the alert to sound, which amounted to “just 15 seconds of light chirping.” What’s more, if he didn’t own an iPhone, he wouldn’t have received any notification.

Although Fowler credits Apple for trying to do more to keep people safe than other tracking device makers, like Tile, have done, his experience still leads him to conclude that AirTags are “a new means of inexpensive, effective stalking.”

So, should Apple stop selling AirTags? Based on Fowler’s experiment, a natural conclusion is ‘yes.’ However, as it is with so many products that offer both positive and negative outcomes, the answer is not that easy.

For instance, many of us travel in automobiles each day to go to work, school, shopping etc. Tragically, more than 38,000 U.S. residents die in car crashes each year, and many more are injured. Also, we’ve unfortunately seen some use cars maliciously to kill others.

However, such incidents don't make many of us think twice about climbing into a car or crossing streets where others are driving them. Although the potential negative outcomes of injury and death are daunting, the great individual and collective benefits of car use overshadow those remote probabilities.

Similar rationale can be applied to many other products from kitchen knives to prescription drugs. We welcome their use because in the vast majority of cases they help people, not harm them.

Still, it’s fair to ask if AirTags offer a high enough risk-to-reward ratio. Yes, misplacing one’s car keys is annoying and can even be very frustrating, but we usually find them. How do we weigh the convenience of finding lost keys against the use of the devices to track others’ property or people themselves?

Those risks, especially if they become more common, likely don’t outweigh the rewards of quicker key recovery. However, there are several other, potentially more critical functions that AirTags can serve. Writing for Gadget Hacks, Jake Peterson identifies several of those uses, which include:

Lifesaver Beacons: People with severe allergic reactions can place AirTags on life-saving medications like EpiPens.
Location Trackers for Children: Parents can put the devices in their children’s backpacks or pockets and hopefully avoid experiencing their worst nightmare—a lost child.
Location Trackers for People with Dementia: At the other end of the age spectrum, some individuals beset by mental decline wander off. AirTags can make it easier to find them quickly.
Beacons for the Visually Impaired: The Find My app can help people with limited or no sight precisely locate important objects within their homes.
Location Trackers for Pets: An AirTag can help ensure that a beloved animal is found, without needing to insert a microchip into the pet.

Do the benefits of these latter applications outweigh the risks of unscrupulous AirTag use? They probably do, provided that Apple continues to improve AirTag security and that the deviant behavior remains isolated. Assuming those two ‘tag rules,’ AirTags can be useful for many people, helping to make the tracking devices “Mindful Marketing.”

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A Bad Sign: Macy's vs. Amazon Billboard Battle

12/4/2021

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by David Hagenbuch - professor of Marketing at Messiah University -
author of Honorable Influence - founder of Mindful Marketing

With the holiday shopping season in full swing, many consumers are unaware of two titan retailers’ battle over a billboard, the results of which could impact how and where shoppers buy gifts for years to come. The clash also could impact what businesses come to accept as moral behavior.

The site of the showdown is the corner of 34th Street and Broadway, New York City, at the center of U.S. commerce. It’s there that Macy’s, which once boasted “the worlds’ largest retail store,” is taking what could be a final stand against the encroachment of Earth’s fastest-growing retailer, and one of nature’s most irrepressible forces: Amazon.

Macy’s has filed a lawsuit against Amazon, hoping to keep its close competitor from commandeering a 2,200 square foot billboard that adjoins Macy’s flagship Herald Square store. It’s a signage space Macy’s has leased for nearly 60 years.

The huge billboard, which features Macy’s iconic star and logo typeface set against the familiar bright red background, serves as a beacon for millions of pedestrians and potential shoppers as they walk north on Broadway and west on 34th Street. Millions more see the sign every November in countless camera shots during the retailer’s world-renowned Thanksgiving Day Parade.

Amazon, an organization that can send astronauts into orbit, is capable of just about anything, but how could even it endeavor to place its name on a billboard on the side of such a storied competitor’s flagship store?

Key to the controversy is the fact that Macy’s doesn’t own the building on which the billboard rests; the sign is actually attached to a small separate edifice situated just between the retailer’s massive 2.2 million sq. ft. store and the intersection. The owner of the tiny architectural interloper and its very valuable billboard is Kaufman Realty Corp.

With the contract it signed in 1963 expiring, Macy’s asked Kaufman to renew its billboard ad, but the company told its long-standing tenant that it intended to rent the space to a “prominent online retailer”—one who apparently has deep pockets and who most believe is Amazon.

Of course, both Macy’s and Amazon have physical stores and virtual ones; yet, Macy’s is in many ways the quintessential brick-and-mortar retailer while Amazon practically owns online shopping.

In a very real way, therefore, the billboard battle represents a titanic clash of competing marketing channels and business models, the results of which could impact consumer shopping behavior for years to come, as well as set important moral precedent.

Macy’s firmly believes that its loss of the advertising space, next to its flagship store, would be disastrous, as the suit it filed states, “The damages to Macy's customer goodwill, image, reputation and brand, should a 'prominent online retailer' (especially Amazon) advertise on the billboard are impossible to calculate.”

With net income that’s exceeded $1 billion for eight of the last ten years, Macy’s is doing well compared to many retailers, especially those that filed for bankruptcy over the last 18 months, e.g., Lord & Taylor, J.C. Penney, J Crew, Neiman Marcus, and Pier 1.

However, Macy’s profit margin for 2020 was a modest 2.9%. Amazon, in contrast, had net income of $21.3 billion on revenue of $386 billion, giving it not only much greater earnings but also a significantly higher rate of return—5.5%.

So, although Macy’s is not quite on the cusp, it’s certainly not operating from a position of power versus Amazon, and it truly can’t afford to see its flagship store, which it’s described as its “most valuable asset,” take a serious financial hit.

However, a hit on Macy’s Herald Square store and its effect on the future of retail is only one concern of the billboard battle: Amazon’s aggressive competitive tactic is also a breach of business’s moral bulwark.

Of course, Amazon has a right to buy any billboard it wants, but a key question is why the firm needs to buy that one.

According to Statista, there are over 340,000 billboards, or “big format outdoor displays,” in the United States. Just a ten-minute walk north of Herald Square lies Time Square, which has probably the greatest display of outdoor advertising in the world.

Granted, a sign in this spectacle of commercialism comes at a very high cost: between $5,000 and $50,000 a day, which could mean as much as $18.25 million a year. Still, that amount of money is almost immaterial to the one of the world’s richest companies.

As of December 31, 2020, Amazon’s balance sheet showed cash and cash equivalents of $41.2 billion. Even a $50,000-a-day billboard would represent less than half of one percent of those liquid assets (just 0.0445%).

So, if hundreds of thousands of large outdoor signs are available and Amazon can afford to rent any billboard it wants, why does it have to have the one in Herald Square that’s adjacent to one of its biggest competitor’s flagship stores?

It’s reasonable to infer an intent to attack the heart of Macy’s operations, to steal shoppers from in front of its landmark store, and perhaps even to embarrass the firm before its own customers.

Some might respond to such assertions of over-the-top aggression with, “That’s business,” or “Amazon is just being competitive,” or “The company is playing to win.” There’s a difference, though, between working hard to win and trying menacingly to make others lose. Unfortunately, Amazon’s billboard-buy seems like the latter.

Growing up, I loved to play sports and considered myself a pretty competitive person—I wanted to win and tried my hardest to do so. Although I didn’t like losing, I could tolerate it—it wasn’t the end of the world—especially if I played my best and the other person/team simply outperformed me.

By the same token, I never liked the idea of trying to sabotage or subvert opposing players’ performance. Instead, I thought, “Let them do their best, and I’ll do my best, and whosever best is better deserves to win.” I didn’t have to come out on top every time; I could ‘share the podium.’ Part of competing was knowing how to win and lose graciously.

In contrast, some individuals and organizations compete as if it’s all or nothing, and they have to have it all, all the time. They’ve no sense that ‘the market's big, so there’s plenty of business for everyone.’

Maybe it’s because of the holidays that this self-obsessed way of thinking reminds me of the Christmas classic It’s a Wonderful Life--specifically the film’s antagonist, the greedy and scheming Mr. Potter. Although he and his bank already own half of Bedford Falls, he won’t rest until it’s all under his control, not tolerating even a minor amount of competition from George Bailey’s small Building & Loan. No one else can win; he has to have it all.

My guess is that Mr. Potter would be proud of Amazon’s attempt to pry the Herald Square billboard lease away from Macy’s.

Macy’s is no real threat to Amazon, which can afford any outdoor advertising it wants and doesn’t need to have that specific sign. So, why go after it? It seems like Amazon doesn’t want anyone else to win; it has to have it all.

Macy’s lawsuit claims that all past and present agreements have prohibited the billboard’s owner from ever leasing the space to any other “establishment selling at retail or directly to any consumer.” If that claim is true and Macy’s is offering Kaufman Realty fair compensation for the lease, Macy’s has even more reason to believe its treatment is unreasonable.

Competition is not only necessary, it’s desirable, as it both benefits consumers and sharpens industry rivals. However, when organizations like Amazon enlist predatory business practices, their strategies are a sign of “Single-Minded Marketing.”

Subscribe to Mindful Matters blog.
Learn more about the Mindful Matrix.
Check out Mindful Marketing Ads and Vote your Mind!

24 Comments

Are Apple AirTags Too Risky?

A Bad Sign: Macy's vs. Amazon Billboard Battle

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