Programmatic Advertising : Effective marketing strategy or invasion of privacy - A study of consumer attitudes towards Programmatic Advertising

Abstract: Digital marketing is constantly adapting and evolving in line with technological advances. One of these advances is the digitalization, which has given rise to Programmatic Advertising (PA). In order to practice PA, the companies need to collect data about consumers' preferences and personal interests. On the other hand, consumers have a need to protect their privacy. The needs of these two parties cross each other which creates the tension, called the Personalization-privacy paradox. In this study, we intend to investigate consumers' attitudes towards PA and whether personalization gives rise to improved browsing experiences or evenviolates their privacy. A quantitative study was conducted, where the independent variable was called Personalization and the dependent variables - Attractiveness, Annoyance, Invasiveness and Trade-off. The results of bivariate regression analysis showed that all of the dependent variables of the study were statistically significant. The results also illustrated that the majority of the respondents experienced PA ads as beneficial, but also invasive. These results are in line with the Utility maximization theory, as PA ads were considered both beneficial and risky. Therefore, consumers would have incentives to disclose their personal information as long as the percieved benefits would outweigh perceived risks, generated by PA. We concluded that there are no clear, predetermined answers to what attitudes consumers have towards PA, but this can vary from case to case, which is in line with both the Privacy calculus theory and the Utility maximization theory. This involves a risk-benefit analysis, performed by consumers, where perceived benefits exceeding perceived risks would generate positive attitudes and vice versa