The personalization Privacy Paradox

Summary: The personalization Privacy Paradox: An Empirical Evaluation of Information Transparency and Willingness to Be Profiled Online for Personalization

Naveen Farag Awad and M.S. Krishnan analyze in their article the relationship between information transparency and the willingness to partake in personalization. This analysis is done on the basis of the utility maximization theory, identifying the willingness of the user to trade personal information in exchange of some benefits with the microeconomics framework. In this case, the benefit (B) obtained from a certain commodity is the advantage that the user can obtain by using a specific service and the cost (C) which needs to be minimized is a function of different factors, including “consumer privacy concern, previous privacy invasions, consumer-rated importance of information transparency and consumer-rated importance of privacy policies).

The target is the maximization of the Utility (U) function which is as follow:

U(X) = Benefit – Cost

The dependencies among the different factors are studied from the perspective of the following research model:

This model proposes some interesting concepts, for example:

  • Consumer-rated importance of information transparency increases with increased general consumer privacy concern level.
  • Consumer-rated importance of information transparency increased with consumers who have previously had previously had their privacy invaded online.

According to the classification of frameworks proposed by Iachello, this study could be considered as “communitarian”, since the main objective is to provide a set of guidelines to maximize the level of satisfaction of the user, based on the results obtained, as opposed to “principled”, in which the objective is to guarantee the protection of the personal information of the end-user.