Social Influence and Visual Attention in the Personalization Privacy Paradox for Social Advertising: An Eye Tracking Study

The personalization privacy paradox suggests that the personalization of advertising increases ad relevance but simultaneously triggers privacy concerns as firms make use of consumers' information. We combine a lab experiment with eye tracking and survey methodology to investigate the role of informational social influence and visual attention in the personalization privacy paradox for social advertising. While previous research pointed towards social influence increasing consumers’ trust in advertisers, we find that social influence does not help to reduce consumer privacy concerns originating in personalization. Next, our findings contradict the presence of a negativity bias directing consumers' attention to negatively perceived stimuli. We show that privacy concerns decrease consumers' attention towards personalized ads, subsequently leading to a decrease in ad clicks. This finding supports a positive role of visual attention for advertising performance. We show that privacy concerns, triggered by personalization, negatively influence ad performance through a decrease in attention towards ads. Our analysis indicates that consumers need to process ad information sufficiently, i.e. dedicate a sufficient amount of attention to the ad, to actually experience privacy concerns.