While I generally consider myself an advocate of strong consumer privacy protection, even I have to admit that there are generally two sides to every invasion of consumer privacy. For example, shopper loyalty programs are criticized for raising consumers' fraud risk, and for leading to a proliferation of annoying telemarketer and junk mail contacts (e.g., here). However, sometimes, the information gathered by grocery stores is used in ways which are unarguably beneficial to consumers. Case in point: product recalls. Before my fourth of July barbecue, I got a call from Kroger's. Apparently, the ground beef I'd purchased earlier in the week had been recalled, and should be thrown away rather than eaten. Of course, they knew who I was and what I'd purchased, because I used my Kroger card to buy the meat, which meant they were tracking my purchases and storing the data.
The bottom line is that the same data type of data collection which leads to annoying circulars and telemarketer calls led to Kroger being able to provide me with information that I really needed. Of course, consumer data collection isn't an unalloyed good, but it isn't an unalloyed evil either. The trick is to find ways to deal with (or regulate) the data collection that maximizes the good while minimizing the harm.