The Price of Privacy - An Evaluation of the Economic Value of Collecting Clickstream Data

The analysis of clickstream data facilitates the understanding and prediction of customer behavior in e-commerce. Companies can leverage such data to increase revenue. For customers and website users, on the other hand, the collection of behavioral data entails privacy invasion. The objective of the paper is to shed light on the trade-off between privacy and the business value of cus- tomer information. To that end, the authors review approaches to convert clickstream data into behavioral traits, which we call clickstream features, and propose a categorization of these features according to the potential threat they pose to user privacy. The authors then examine the extent to which different categories of clickstream features facilitate predictions of online user shopping pat- terns and approximate the marginal utility of using more privacy adverse information in behavioral prediction models. Thus, the paper links the literature on user privacy to that on e-commerce analytics and takes a step toward an economic analysis of privacy costs and benefits. In par- ticular, the results of empirical experimentation with large real-world e-commerce data suggest that the inclusion of short-term customer behavior based on session-related information leads to large gains in predictive accuracy and business performance, while storing and aggregating usage behavior over longer horizons has comparably less value

Mobiilisovellusten asiakasarvon hallinta

Digitalization has brought new business opportunities, including utilization of mobile applications. In order to succeed, firms need to manage the customer value properly. The objective of this study is to identify factors that contribute to the customer value of retail mobile applications, and introduce the best practices. In addition, key indicators to measure the success are introduced. The research questions are first answered by a comprehensive literature research followed by empirical research consisting of interviews, analysis of customer feedback and practical business case. Finally, all the findings of literature and empirical research are compared in order to form conclusions. The aspects of the study range from the mobile applications as part of the bigger picture of business models and channels, going through customer behavior, marketing, usability and gamification from customer value point of view, all the way to indicators to measure the success. Retail mobile applications have good customer value and positive business effects when implemented and managed correctly. This is also supported by the practical business case showing increase in sales factors. A successful retail mobile application has the look and feel of a retailer, offers personalized, updated features and services for the customers considering dynamic customer behavior, agile targeted marketing, interactivity, and usability aspects. Customer loyalty is built step by step originating from customer value, engagement and satisfaction. Gamification features potentially improve customer value and loyalty, but should be implemented wisely. Mobile applications should consider consistency to other channels. Omni-channel approach and exploration of platform economy related opportunities are recommended. Utilizing indicators in connection to data and analytics is extremely important in order to succeed in customer value management of mobile applications. Selection of indicators should be based on the objectives and strategy of a firm. Key success indicators for retail mobile applications measure conversion in application and in-store, customer loyalty, customer life-time value, and application usage. This study contributes to existing research by combining key aspects of customer value management of mobile applications in retail context. Potential value from gamification features, introduction of success indicators, and elaboration of theory on real business context complement this study to a fundamental guideline to be utilized for further research and business decisions.Hyödyntääkseen digitalisaation tuomat liiketoimintamahdollisuudet, kuten mobiilisovellukset, yritysten tulee hallita asiakasarvoa oikealla tavalla. Tämän työn tarkoitus on löytää vähittäiskaupan mobiilisovellusten asiakasarvon kannalta tärkeimmät ominaisuudet sekä esitellä parhaat mittarit mobiilisovellusten hyötyjen mittaamiseen. Tutkimuskysymyksiin etsitään ensin vastauksia laajan kirjallisuuskatsauksen avulla, jonka jälkeen vastaavia aihealueita tutkitaan empiirisesti haastattelujen, asiakaspalauteanalyysin ja käytännön myyntivaikutusten avulla. Lopuksi johtopäätökset muodostetaan analysoimalla ja vertailemalla löydöksiä. Työn aihealuetta lähestytään kokonaisuuden näkökulmasta, huomioiden mobiilisovellukset osana kokonaisvaltaista liiketoimintaa, liiketoimintamalleja ja kanavia. Aihealuetta tarkastellaan asiakasarvoon liittyen asiakaskäyttäytymisen, markkinoinnin, käytettävyyden ja pelillistämisen näkökulmista, linkittyen lopuksi hyötyjen mittareihin. Oikein toteutettuina ja hallinnoituina vähittäiskaupan mobiilisovellukset vaikuttavat positiivisesti asiakasarvoon ja tuottoisasti liiketoimintaan. Tätä tukevat myös löydökset kasvaneista myynnin osatekijöistä käytännön myyntivaikutusten tutkimuksessa. Hyvä vähittäiskaupan mobiilisovellus heijastaa kivijalkakaupan ja kauppiaan tunnelmaa, tarjoaa henkilökohtaisia, päivittyviä ominaisuuksia ja palveluja asiakkaille huomioiden vaihtelevan asiakaskäyttäytymisen, ketterän, kohdennetun markkinoinnin, vuorovaikutteisuuden, ja käytettävyysnäkökulman. Asiakkaiden lojaalisuus rakentuu askeleittain lähtien asiakasarvosta, sitoutuneisuudesta ja tyytyväisyydestä. Pelillistämisen avulla voidaan kasvattaa asiakaarvoa ja lojaalisuutta, kunhan se toteutetaan järkevästi. Mobiilisovelluksissa tulee huomioida yhtenäisyys muihin kanaviin. Omni-channel –mallia ja alustatalouden tarjoamien mahdollisuuksien tutkimista suositellaan. Mittareiden hyödyntäminen yhdessä tiedon ja analytiikan kanssa on erittäin tärkeää mobiilisovellusten asiakasarvon hallinnassa onnistumisen kannalta. Mittareiden valinnan tulisi perustua yrityksen tavoitteisiin ja strategiaan. Vähittäiskaupan mobiilisovellusten menestyksen avainmittareiden tulisi mitata sekä sovelluksen että kivijalkakaupan konversiota, asiakaslojaalisuutta, asiakassuhteen kokonaisarvoa, ja sovelluksen käyttöä. Tämä työ täydentää olemassa olevaa tutkimusta yhdistäen tärkeimmät eri näkökulmat mobiilisovellusten asiakasarvon hallintaan liittyen vähittäiskaupan toimialalla. Pelillistämisen tarjoamat hyödyt, avainmittareiden esittely, ja teorian tarkentaminen käytännön liiketoiminnan kontekstiin tekevät tästä työstä perusteellisen ohjenuoran jatkotutkimuksen sekä liiketoiminnan päätösten tueksi

Visual analytics and artificial intelligence for marketing

In today’s online environments, such as social media platforms and e-commerce websites, consumers are overloaded with information and firms are competing for their attention. Most of the data on these platforms comes in the form of text, images, or other unstructured data sources. It is important to understand which information on company websites and social media platforms are enticing and/or likeable by consumers. The impact of online visual content, in particular, remains largely unknown. Finding the drivers behind likes and clicks can help (1) understand how consumers interact with the information that is presented to them and (2) leverage this knowledge to improve marketing content. The main goal of this dissertation is to learn more about why consumers like and click on visual content online. To reach this goal visual analytics are used for automatic extraction of relevant information from visual content. This information can then be related, at scale, to consumer and their decisions

Reconciling the Personalization-Privacy Paradox: Exploring Privacy Boundaries in Online Personalized Advertising

To reconcile the personalization-privacy paradox, we adopt the privacy as a state view and define privacy as a state of information boundary rule-following. We further identify five types of boundaries underlying some of the important implicit rules of maintaining privacy: communication channel, platform, device, temporal, and purpose boundaries. Using an online vignette survey, we investigated how each of these boundary types affected users’ privacy perceptions when they were subjected to personalized advertisements. Using fixed- and random-effects models, we investigated how violating different boundary rules leads to changes in perceived privacy. Our results show that all five boundary types are significant predictors of perceived privacy within individuals. The communication channel, device, and business versus private purpose are significant predictors of perceived privacy across the whole sample. Temporal boundaries and platform boundaries failed to achieve statistical significance when evaluated simultaneously with the other factors across the whole sample. This means that for each individual, observing the rules of these five boundary types leads to higher perceived privacy than not observing these conditions. Taken as a whole, observing communication channel, device, and business versus private purpose boundaries also leads to higher averages of perceived privacy across the whole sample. Theoretical and practical implications are discussed based on the result

The Impact of Web Page Design on Consumer Behaviour in Online Shopping

The life of a modern person cannot be imagined without the Internet; this is an obvious fact and an integral part of communication. A modern user of the global network has a wide range of possibilities. The Internet is not only a source of relevant information. The creation of an online store is one of the most popular schemes for doing business on the Internet. More recently, people did not have any confidence in the sale of goods via the Internet, but now almost every user has ordered goods on the Internet at least once. In online shopping environments, a website interface serves as the "online storefront" for customers to interact with the online retailer, and to experience and evaluate the quality of service manifested by the website design [23]. Previous studies have found that the website design interface plays an important role in online purchasing during customers’ initial experiences with an online retailer, as the website design elements and the interaction experience influence customers' initial beliefs and subsequent behavioural intentions [22] and customers are more likely to visit and buy from better-designed websites [16]. However, previous studies have not provided consistent information about the features a website should provide. The aim of the study is to analyse how consumers evaluate website design when shopping online and how website design affects purchasing power. The study analysed the value that consumers place on website design when shopping online and how website design affects purchasing power. The survey method, one of the quantitative research methods, was used as a research method

Can Upward Brand Extensions be an Opportunity for Marketing Managers During the Covid-19 Pandemic and Beyond?

Early COVID-19 research has guided current managerial practice by introducing more products across different product categories as consumers tried to avoid perceived health risks from food shortages, i.e. horizontal brand extensions. For example, Leon, a fast-food restaurant in the UK, introduced a new range of ready meal products. However, when the food supply stabilised, availability may no longer be a concern for consumers. Instead, job losses could be a driver of higher perceived financial risks. Meanwhile, it remains unknown whether the perceived health or financial risks play a more significant role on consumers’ consumptions. Our preliminary survey shows perceived health risks outperform perceived financial risks to positively influence purchase intention during COVID-19. We suggest such a result indicates an opportunity for marketers to consider introducing premium priced products, i.e. upward brand extensions. The risk-as�feelings and signalling theories were used to explain consumer choice under risk may adopt affective heuristic processing, using minimal cognitive efforts to evaluate products. Based on this, consumers are likely to be affected by the salient high-quality and reliable product cue of upward extension signalled by its premium price level, which may attract consumers to purchase when they have high perceived health risks associated with COVID-19. Addressing this, a series of experimental studies confirm that upward brand extensions (versus normal new product introductions) can positively moderate the positive effect between perceived health risks associated with COVID-19 and purchase intention. Such an effect can be mediated by affective heuristic information processing. The results contribute to emergent COVID-19 literature and managerial practice during the pandemic but could also inform post-pandemic thinking around vertical brand extensions