Asia pacific journal of information systems

The Korea Society of Management Information Systems (한국경영정보학회)
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Information Privacy and Reactance in Online Profiling

온라인 고객정보 수집에서의 프라이버시와 심리적 반발

  • Lee, Gyu-Dong (Business Administration(Management information Systems) from Sungkyunkwan University) ;
  • Lee, Won-Jun (SKKU Business School)
  • Published : 2009.12.31
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Abstract

In the information age, cheap price of information processing and advances in personalization technology have allowed companies to enhance the relationships with their existing customers and to expand their customer base by effectively attracting new customers. However, most customers are reluctant to provide their personal information to companies. This study explores the tension between companies' desire to collect personal information to offer personalized services and their customers' privacy concerns. The psychological reactance theory suggests that when individuals feel that their behavioral choice is threatened or restricted, they are motivated to restore their freedom. Therefore, despite the expected benefits from personalized services, customers may perceive the services to be restrictive of their freedom to choose. This adverse effect may undermine the relationships between companies and their customers. We conducted experiments to explore the dynamic roles of transactional and environmental factors in motivating customers to provide personal information. We revisited online privacy issues from the perspective of psychological reactance. For the experiments, we created an online shop and randomly assigned the participants to one of the two experimental conditions-high and low levels of information requirements. The results of the experiment indicate that threatening the free choice serves as a transactional cost in online profiling. On the other hand, the expected benefits of personalization services have positive correlations with customers' willingness to provide personal information. This study explains privacy based on transactional and environmental factors. Our findings also indicate that the environmental factors such as the Internet privacy risk and trust propensity do not significantly affect the willingness to provide personal information when firms required much personal information. Implications and contributions are discussed.

Keywords

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