'Spend Graphs' are Here

The next stage of shopping evolution has begun, courtesy of American Express' new spend graph program.

Spend graphing is the combination of GPS technology and high speed data mining capabilities. Your credit card issuers have been tracking your spending habits since the day you made your very first pulled out a piece of plastic rather than cash. Very complicated algorithms give the card company the power to predict to the penny how much you will spend, for what items, at what store, with amazing (or frightening) accuracy. These models predicting your spending habits have existed in a vacuum until recently- the missing variable was the 'when' you would make the purchase, and without a when, the what, where, and how many couldn't be acted upon. Enter global positioning satellites.

The card companies figured out there was no need to guess when you would make a purchase if  GPS technology could tell them when you were walking into a store.

Based on that, American Express now offers their cardholders the ability to receive to their mobile form or tablet real time offers.

Once a cardholder opts into the system it works as follows- GPS telemetry pick up that a member has just walked into Macy's. Amex has stored on it's servers that you spend $400 a month at Macy's, at an average of $200 per visit, and that 50 percent of your purchases are women's clothing, and that 75 percent of that is spend on Calvin Klein dresses and active wear.

Almost immediately upon entering the store, you are alerted to a new text, and therein is an offer for 30 percent off of all Calvin Klein women's wear- good for the next hour only.

Privacy advocates are howling about the program, but American Express calls in a win for consumers and businesses alike.

"In an increasingly crowded marketplace, where consumers are bombarded with daily deals, we saw an opportunity to help our Cardmembers save time as well as money by curating meaningful offers for them," said Josh Silverman, president of the U.S. Consumer Services Group at American Express. "At the same time we can help our merchant partners build their business by helping them reach the right Cardmembers with the right offer at the right time. We developed our mobile offer engine with three key points of differentiation in mind; relevance, convenience and value."