Consumer responses to personalization in online advertising

Prof. Dr. Maik Eisenbeiß

Universität Bremen

 

It is widely accepted that consumers move through different stages in their buying process, the so-called customer decision journey. Typically, consumers first realize they have a need, then they research and evaluate possible alternatives, and finally they purchase one of them. While the customer decision journey used to be quite organized in previous days, it has become a lot more complex and less predictable with the increasing digitalization. New technology, devices and other trends are increasing the possibilities consumers find, evaluate and purchase products and services. Today’s consumers are exposed to a multitude of touchpoints and a vast number of messages along their decision journey.

 

In order stand out from the crowd, firms more than ever need to address consumers with valuable messages. One very popular and theoretically appealing attempt in the context of online advertising is personalization, i.e., to tailor ad messages to a consumer’s individual needs and wants. At first glance, this makes sense: Personalization should render an ad more relevant and thus increase its effectiveness. However, in a series of research projects, we demonstrate that this does not necessarily hold true. More precisely, we highlight and explain under which conditions consumers respond favorably or unfavorably to personalization in online advertising along their decision journey.