Kim van Leeuwen

Kim van Leeuwen is a master student in Marketing Management at the Erasmus University of Rotterdam in the Netherlands. She has a background in Consumer behavior and focuses on a positive and sustainable relationship between companies and consumers.

Her research focuses on a process of online advertising that is compliant with the GDPR and benefits both companies and consumers. Therefore, she proposed an online marketplace that allows for this process of GDPR compliant online advertising to occur, while using personal data. This marketplace empowers consumers to share their personal data deliberately with marketers to receive discounts on products and services.

Afterwards, Kim used choice-based conjoint analysis to study consumer behavior regarding the trade-off between the risks (type and amount of data) and benefits (discounts) of sharing personal data.

Executive Summary

Since the introduction of the General Data Protection Regulation (GDPR) the process of online advertising is complicated. Companies are forced to find a manner to segment and target their potential customers with personalized advertisements that does not rely on behavioral data collection by tech giants. A solution for online advertising that is compliant with the GDPR was proposed in this research. This solution involves cutting out tech giants as the middlemen for advertising and empowering consumers to share their data directly to companies. Consumers could share their personal data deliberately to companies via an online marketplace when they want to buy products and services. In exchange for consumers’ personal data companies could give discounts on the products and services that they offer.

In order for this proposed online marketplace to work as a tool to comply with the GDPR, consumers need to be willing to share their data deliberately. Hence, it was necessary to study consumers’ willingness to share personal data in this context.

For consumers that consider sharing their personal data there is a trade-off between the perceived benefits and risks of sharing, referred to as the ‘privacy calculus’. Perceived privacy risks of sharing data depend among others on the amount and type of the personal data that is shared. The benefit concerns receiving discounts on the products/services at the marketplace in exchange for sharing data. This research shed light on how consumers make the trade-off between these risks and benefits while deciding to share data when buying a laptop at the proposed marketplace.

It was explored which types of personal data consumers were willing to share with marketers at the proposed online marketplace. Moreover, the monetary value that customers demand in order to be willing to share different data types was quantified. The findings were used to judge whether consumers would be willing to trade their data at all and whether it is advisable to ask for certain data at the proposed marketplace.

It was impossible to measure actual data sharing in this research, so the willingness to share personal data was measured by using choice based conjoint analysis with a sample of 188 respondents. This analysis was chosen for two reasons. First, to mitigate the biasing effect of the privacy paradox. This privacy paradox states that people’s behavior regarding data sharing is not consistent with their self-reported willingness to do so. Second, to be able to measure the trade-off between risks and benefits in a natural way.

It was found that people rather share as little information as possible if they do not receive a discount in return. However, when discounts were offered the willingness to share personal data was found to be higher. Thus, the privacy calculus was confirmed. This means that the willingness to share personal data can be influenced by decreasing the risks or increasing the benefits of sharing personal data.

The willingness to leverage personal data indicates that consumers might be willing to buy products at the online marketplace to receive discounts in exchange for their personal data. However, it was found that consumers were more reluctant to share financial information compared to other data types. The discount demanded in order to be willing to share this data type is high. The high price is expected to discourage companies to ask for this type of information.

Personal data is shared only if the buyer and seller agree on a ‘price’ and benefit from it both. Therefore, treating personal data as a good that is ‘sold’ via the online marketplace could work to regulate privacy. However, policymakers should decide whether it is ethically justified to ask consumers to share personal data in exchange for discounts.

 

Keywords: willingness to share, personal data, privacy calculus, GDPR