Academic journal article The Journal of Consumer Affairs

The Privacy Paradox: Personal Information Disclosure Intentions versus Behaviors

Academic journal article The Journal of Consumer Affairs

The Privacy Paradox: Personal Information Disclosure Intentions versus Behaviors

Article excerpt

Impelled by the development of technologies that facilitate collection, distribution, storage, and manipulation of personal consumer information, privacy has become a "hot" topic for policy makers. Commercial interests seek to maximize and then leverage the value of consumer information, while, at the same time, consumers voice concerns that their rights and ability to control their personal information in the marketplace are being violated. However, despite the complaints, it appears that consumers freely provide personal data. This research explores what we call the "privacy paradox" or the relationship between individuals' intentions to disclose personal information and their actual personal information disclosure behaviors.

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With increasingly sophisticated technology, the effectiveness of collecting, storing, and analyzing vast amounts of consumer information has certainly increased, especially as related costs have fallen. Marketers who live by the adage "know thy customer" may view this progress as movement toward the desired state where knowledge of customers leads to ultra-efficient communication to exactly the right target audiences about product/service offerings, which perfectly match the needs and desires of those same groups (Moon 2000).

However, as marketers leverage the ability to collect and analyze ever-greater amounts of consumer information, serious concerns have arisen over the potential erosion of personal privacy (cf. Cavoukian and Hamilton 2002; Whiting 2002; Williams 2002). The popular press has featured privacy concerns as a major negative result of the "information age," and political forces have sought to transform consumers' felt deprivation into public policy initiatives. Consumers are constantly faced with the not-so-obvious trade-off between the desire for better products and services that are touted to be the result of more detailed customer profiles on the one hand and the privacy encroachment that such disclosure causes on the other.

Yet, for all the concern that people express about their personal information, which could be expected to drive one's intended and actual disclosure, our observations of actual marketplace behavior anecdotally suggest that people are less than selective and often cavalier in the protection of their own data profiles. Few studies have examined this discrepancy between individuals' intentions to protect their own privacy and how they behave in the marketplace. The purpose of this exploratory study is to investigate whether people say one thing (intend to limit disclosure) and then do another (actually provide personal details) during marketing exchanges. To that end, we report the results of two studies that demonstrate the existence of the privacy paradox and suggest that individuals' considerations of risk and trust help explain why it occurs. Additionally, a discussion of public policy is offered, with the goal of stimulating thoughts about how the desires of the public to maintain a sense of privacy may be preserved in an environment where privacy erosion seems inevitable.

BACKGROUND

That people are willing to trade personal information for perceived benefits is no surprise. For instance, a Web site that provides useful data may require the user to register in order to access the information. It is likely that economists and others would utilize an exchange framework to posit that the information the consumer receives from the Web site in this example is clearly of greater value than that of the information provided by the consumer to the site. Yet, this explanation seems less appropriate when we repeatedly witness people giving their phone numbers to clerks while engaged in simple cash transactions at a Sports Authority store. In this case, the benefit may be more difficult to ascertain. As O'Harrow noted in a recent book on surveillance and information collection, consumers "often willingly, even eagerly, part with intimate details of their lives" (2005, p. …

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