Why Am I Seeing This Ad? The Effect of Ad Transparency on Ad Effectiveness

By Tami Kim, Kate Barasz, Leslie K. John. 2019

210 citations recorded by the source corpus.

Given the increasingly specific ways marketers can target ads, many consumers and regulators are demanding ad transparency: disclosure of how consumers’ personal information was used to generate ads. We investigate how and why ad transparency impacts ad effectiveness. Drawing on literature about offline norms of information-sharing, we posit that ad transparency backfires when it exposes marketing practices that violate norms about “information flows”—consumers’ beliefs about how their information ought to move between parties. Study 1 inductively shows that consumers deem information flows acceptable (or not) based on whether their personal information was: 1) obtained within versus outside of the website on which the ad appears, and 2) stated by the consumer versus inferred by the firm (the latter of each pair being less acceptable). Studies 2 and 3 show that revealing unacceptable information flows reduces ad effectiveness, which is driven by increasing consumers’ relative concern for their privacy over desire for the personalization that such targeting affords. Study 4 shows the moderating role of platform trust: when consumers trust a platform, revealing acceptable information flows increases ad effectiveness. Studies 5a and 5b, conducted in the field with a loyalty program website (i.e., a trusted platform), demonstrate this benefit of transparency.

Subfields: Marketing, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/808b318a5759f8e667efa2aba6767584988e18e2

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Citations in the corpus

The effects of ad heuristic and systematic cues on consumer brand awareness and purchase intention: Investigating the bias effect of heuristic information processing (2021, background): “Ad contextual features, i.e. platform types, poster popularity, influence consumer decision making process through the spillover effect (Voorveld et al., 2018; Boerman, 2020; Kim et al., 2019).”
A Review and Conceptual Framework for Understanding Personalized Matching Effects in Persuasion (2020, background): “…with conservative (vs. liberal) beliefs receive messages framed in terms of restoring a desirable past (vs. ensuring a desirable future; Lammers & Baldwin, 2018) or in terms of maintaining (vs. advancing) status via the purchase of luxury goods (Kim et al., 2018b), it tends to enhance persuasion.”