Personalized Online Customer Experience: The Effect of Information Transparency: An Abstract

Companies increasingly personalize their website content to offer an optimal online experience to their customers. Personalization enables them to automatically adapt their content based on customers’ data. Although customers may value personalization, they may also have negative responses to it, such as privacy concerns. In this context, companies expect that information transparency about data collection and use will help mitigate negative responses to personalization (Kim et al. 2018). Prior studies investigating the role of information transparency in the personalization process were mainly conducted in the advertising context. While some prior research found that information transparency may improve click-through rates of personalized ads (Aguirre et al. 2015) a recent research found that it may also decrease behavioral intentions depending on the type of data being collected to personalize content (Kim et al. 2018). We still have limited knowledge about how information transparency influences the effect of personalization on online customer experience. In addition, we still have limited knowledge about the influence of customer characteristics in the processing of transparency message. This research aims at investigating the backfire effects of personalization on online customer experience. It also aims at examining the role of information transparency and need for cognition in this process. Need for cognition has been identified as an important personality trait in the processing of messages (Cacioppo and Petty 1982; Sicilia and Ruiz 2010). The results of two experiments show that perceived control is lower on personalized websites and that this perceived loss of control triggers privacy concerns. However, the presence of information transparency can reduce these backfire effects depending on customer need for cognition. This research contributes to prior research on personalization and customer experience by further investigating the backfire effects of personalization and by providing a better understanding of the role of information and need for cognition in this process.