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How We Decide Online: Applying the Theory of Privacy Calculus to the Process of Divulging Personal Information Online
 

How We Decide Online: Applying the Theory of Privacy Calculus to the Process of Divulging Personal Information Online

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My final research project as part of the Communications Masters Program at The Johns Hopkins University. ...

My final research project as part of the Communications Masters Program at The Johns Hopkins University.

This study is important to businesses offering products and services online for several reasons. First, the Federal Trade Commission (FTC) has grown more involved in protecting consumers from privacy violations as widespread evidence of questionable privacy policies and practices related to exposure of personal information emerges. A November 2011 settlement with Facebook resulted in, among other requirements, 20 years of privacy audits to ensure users explicitly agree to any changes in how their information is presented and shared online (Sengupta, 2011). The visibility of companies misusing or collecting information without permission has in part prompted efforts to regulate online privacy. The Obama administration has begun this process of regulation with the February 2012 development of a “Privacy Bill of Rights” for online consumers. The proposal seeks to give consumers greater control over their personal data, including a framework for accountability and enforcement of privacy rights (The White House, 2012).
Although businesses should care about the threat of FTC enforcement of consumer rights online, the growing awareness of privacy violations has created another concern for businesses—increased consumer concern over the use of their personal information (McGrath, 2011). While some exchange of sensitive information, such as credit card numbers or shipping address, can be necessary for transactions or required for personalized services, how companies negotiate the release of personal data can mean the difference between success and failure for products and services sold and offered online. To achieve desired consumer behaviors—from online purchases to providing valuable preferences to better sell at a later point—businesses, especially those in roles responsible for website and online product design, must understand how consumers weigh risks and benefits during these online transactions.

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    How We Decide Online: Applying the Theory of Privacy Calculus to the Process of Divulging Personal Information Online How We Decide Online: Applying the Theory of Privacy Calculus to the Process of Divulging Personal Information Online Document Transcript

    • Running  head:  HOW  WE  DECIDE  ONLINE       1                 How  We  Decide  Online:  Applying  the  Theory  of  Privacy  Calculus  to  the  Process  of  Divulging   Personal  Information  Online   Nicole  E.  Cathcart   The  Johns  Hopkins  University      
    • HOW  WE  DECIDE  ONLINE     2   How  We  Decide  Online:  Applying  the  Theory  of  Privacy  Calculus     to  the  Process  of  Divulging  Personal  Information  Online   From  online  stores  to  social  networking  sites,  technology  has  changed  the  way  we  communicate  and  interact  with  the  world  at  large.    But  this  advancement  comes  with  a  price.    Utilization  of  these  technologies,  in  many  cases,  means  a  sacrifice  of  personal  information.    Identity,  preferences,  and  behavior  online  represent  valuable  information  for  businesses  looking  to  sell  products  and  services,  and  this  personal  information  is  rapidly  becoming  a  commodity  online.    Many  websites  (Facebook,  for  example)  offer  services  free  to  the  consumer,  but  in  exchange,  sell  access  to  those  individuals  and  their  information  in  order  to  monetize  services.    The  announcement  of  the  planned  2012  public  filing  of  Facebook  valued  its  800  million  users  around  $125  each,  bringing  the  value  of  the  social  networking  behemoth  to  an  expected  $100  billion,  a  staggering  commentary  on  the  value  of  individual  user  data  (Barnett,  2011;  Sengupta  &  Rusli,  2012;  Swartz,  Martin,  &  Krantz,  2012).    Yet,  consumers  make  decisions  regarding  the  value  of  their  information  with  every  online  transaction  or  information  disclosure,  and  little  is  known  about  each  individual’s  mental  process  of  valuation.   This  study  is  important  to  businesses  offering  products  and  services  online  for  several  reasons.    First,  the  Federal  Trade  Commission  (FTC)  has  grown  more  involved  in  protecting  consumers  from  privacy  violations  as  widespread  evidence  of  questionable  privacy  policies  and  practices  related  to  exposure  of  personal  information  emerges.    A  November  2011  settlement  with  Facebook  resulted  in,  among  other  requirements,  20  years  of  privacy  audits  to  ensure  users  explicitly  agree  to  any  changes  in  how  their  information  is  presented  and  shared  online  (Sengupta,  2011).    The  visibility  of  companies  misusing  or  
    • HOW  WE  DECIDE  ONLINE     3  collecting  information  without  permission  has  in  part  prompted  efforts  to  regulate  online  privacy.    The  Obama  administration  has  begun  this  process  of  regulation  with  the  February  2012  development  of  a  “Privacy  Bill  of  Rights”  for  online  consumers.    The  proposal  seeks  to  give  consumers  greater  control  over  their  personal  data,  including  a  framework  for  accountability  and  enforcement  of  privacy  rights  (The  White  House,  2012).       Although  businesses  should  care  about  the  threat  of  FTC  enforcement  of  consumer  rights  online,  the  growing  awareness  of  privacy  violations  has  created  another  concern  for  businesses—increased  consumer  concern  over  the  use  of  their  personal  information  (McGrath,  2011).    While  some  exchange  of  sensitive  information,  such  as  credit  card  numbers  or  shipping  address,  can  be  necessary  for  transactions  or  required  for  personalized  services,  how  companies  negotiate  the  release  of  personal  data  can  mean  the  difference  between  success  and  failure  for  products  and  services  sold  and  offered  online.    To  achieve  desired  consumer  behaviors—from  online  purchases  to  providing  valuable  preferences  to  better  sell  at  a  later  point—businesses,  especially  those  in  roles  responsible  for  website  and  online  product  design,  must  understand  how  consumers  weigh  risks  and  benefits  during  these  online  transactions.   Online  privacy  lacks  a  universal  definition,  but  the  “Privacy  Bill  of  Rights”  for  online  consumers  provides  several  useful  operational  constructs  under  the  main  idea  of  consumer  control  of  data,  including  transparency  of  intentions  for  data  use  and  assurance  of  data  security  (The  White  House,  2012).      A  company’s  privacy  policy,  usually  highlighted  on  its  website,  should,  at  a  minimum,  address  these  concerns  through  explaining  how  data  will  be  used.    A  particularly  strong  privacy  policy  would  then  give  consumers  total  control,  and  
    • HOW  WE  DECIDE  ONLINE     4  companies  would  not  release  any  information  unless  under  the  explicit  request  of  the  consumer.   Researchers  have  used  several  theories  to  explain  how  consumers  decide  to  purchase  online,  but  few  highlight  the  specific  issue  of  privacy.    One  exception  is  the  theory  of  privacy  calculus,  a  mental  cost-­‐benefit  analysis  that  users  undertake  when  interacting  online  that  weighs  the  cost  of  providing  personal  information  against  the  potential  benefits  of  the  transaction  (Dinev  &  Hart,  2006;  Krasnova,  Spiekermann,  Koroleva,  &  Hildebrand,  2010).    Through  identifying  implicit  and  explicit  indicators  of  risks  and  benefits,  users  make  decisions  to  submit  personal  information  online  during  interactions  like  shopping  or  usage  of  an  online  service.    Privacy  calculus  provides  an  applicable  methodology  for  understanding  how  users  make  fast  decisions  during  online  transactions.   Although  studies  evaluated  in  this  research  have  isolated  important  elements  during  this  privacy  calculus,  including  privacy  policies,  personalization,  convenience,  and  compensation,  very  little  qualitative  research  exists  to  define  the  process  of  a  mental  cost-­‐benefit  analysis.    The  existing  quantitative  research  indicates  some  significant  relationships  and  relative  values  of  elements,  but  rarely  seeks  to  explain  the  motivations  and  the  decision-­‐making  process  behind  that  valuation.   The  purpose  of  this  research  is  to  understand  the  process  consumers  undertake  when  deciding  to  reveal  personal  information  online.    Specifically,  this  research  will  address  the  growing  economic  powerhouse  of  Generation  Y,  a  generation  that  is  growing  in  economic  power  and  very  comfortable  with  technology  (Zickuhr  &  Smith,  2012).    With  an  understanding  of  these  consumers’  decisions,  businesses  that  design  online  stores  and  services  will  be  able  to  generate  more  successful  interactions  and  transactions  online.  
    • HOW  WE  DECIDE  ONLINE     5   Literature  Review     This  representative  literature  review  explores  how  user  attitudes  and  behaviors  change  based  on  perceived  data  control  versus  the  potential  benefits  for  disclosure  of  information,  such  as  personalization,  convenience,  and  compensation.      Users  clearly  value  privacy,  especially  when  explicitly  presented  in  an  online  experience  or  transaction;  however,  users  often  sacrifice  privacy  or  diminish  its  importance  when  presented  with  convenient  processes  or  compensation.    These  studies  explain  a  potential  disparity  between  user  attitudes  and  behaviors.    For  example,  while  44.9%  of  people  say  they  read  privacy  policies,  86.5%  of  respondents  said  they  were  important  to  them  (McGrath,  2011).         The  research  shows  a  complex  interaction  between  the  user  and  a  website  or  brand  where  numerous  features  and  benefits  impact  attitudes  and  behaviors.    Although  a  significant  amount  of  quantitative  research  exists  to  indicate  causality  among  different  elements,  very  little  qualitative  research  explains  the  process  of  how  a  user  weighs  different  factors  to  make  disclosure  decisions.  Indicators  of  Strong  Privacy  Impact  Attitudes  and  Behavior     Privacy  policies  are  often  hidden  on  websites,  tucked  away  in  page  footers.    Yet,  consumers  appear  to  place  a  high  value  on  both  privacy  policies  and  other  indicators  of  the  quality  of  a  website’s  attention  to  privacy.    The  literature  indicates  that  explicit  privacy  policies  can  not  only  increase  trust  in  websites,  but  can  also  increase  willingness  to  transact  online,  even  when  faced  with  higher  prices.    While  online  users  are  not  often  so  clearly  exposed  to  an  online  store’s  or  service’s  intentions  for  use  and  protection  of  personal  information,  when  they  are,  desirable  changes  in  both  attitudes  and  behavioral  intentions  can  occur.  
    • HOW  WE  DECIDE  ONLINE     6   Exposure  to  a  privacy  policy  immediately  prior  to  a  transaction  online  can  significantly  impact  user  attitudes  by  increasing  brand  trustworthiness.    In  a  survey  of  271  undergraduates,  researchers  assigned  a  task  of  completing  an  air  travel  reservation  online  and  were  given  a  copy  of  the  vendor’s  privacy  policy  to  review  prior  to  beginning  the  task  (Bernard  &  Makienko,  2011).    After  completing  the  transaction,  respondents  completed  a  survey  with  questions  regarding  trustworthiness  of  the  vendor,  privacy  concerns,  and  were  controlled  for  past  Internet  experience.    The  results  indicated  that  informing  users  of  intended  use  of  personal  information  had  two  desirable  results,  a  significant  positive  impact  to  the  trustworthiness  of  the  vendor  and  a  significant  negative  impact  to  the  user’s  privacy  concerns.       Strong  privacy  policies  can  also  increase  trust  in  websites  with  low  trust  cues,  such  as  spelling  errors,  broken  links,  and  advertisements  for  services  like  gambling.  In  a  2  x  2  experiment,  181  undergraduate  students  were  randomly  assigned  dummy  website  stimuli  that  presented  either  strong  or  weak  privacy  policies  and  low  or  high  trust  cues  (Joinson,  Reips,  Buchanan,  &  Paine  Schofield,  2010).    Researchers  found  subjects  unwilling  to  disclose  personal  information  only  when  a  weak  privacy  policy  was  combined  with  a  website  displaying  low  trust  cues.    A  site  with  low  trust  cues  combined  with  a  strong  privacy  policy  increased  trust,  resulting  in  the  highest  percentage  of  full  disclosure  of  information,  at  85.1%  of  subjects.    This  result  indicates  that  unknown  brands  can  significantly  increase  the  possibility  of  information  disclosure  online  with  a  strong  privacy  policy.   The  power  of  a  strong  privacy  policy  was  also  identified  by  Tsai,  Engelman,  Cranor,  and  Acquisti  (2011);  the  researchers  manipulated  a  search  engine  results  page  to  display  a  
    • HOW  WE  DECIDE  ONLINE     7  rating  system  indicating  the  strength  of  the  privacy  policies  for  each  result  plus  a  link  to  the  website’s  online  privacy  policy.    The  researchers  recruited  238  subjects  from  the  general  population  of  Pittsburgh  and  designed  the  experiment  to  include  three  groups—those  exposed  to  the  privacy  rating  system,  a  control  group  exposed  to  no  rating,  and  a  group  where  the  stimulus  indicated  that  the  rating  measured  a  non-­‐privacy  related  factor.    The  privacy  rating  subjects  were  more  likely  to  purchase  from  websites  with  highly  rated  privacy  policies,  even  paying  an  average  60-­‐cent  premium  for  products  from  sites  with  high  ratings.    While  the  premium  paid  in  the  privacy  stimulus  group  was  small,  the  control  group  without  access  to  privacy  information  was  significantly  more  likely  to  purchase  the  least  expensive  items.       These  studies  indicate  that  a  visible  and  strong  privacy  policy  can  yield  positive  attitude  and  behavioral  changes  in  website  users.    Not  only  can  the  use  of  a  privacy  policy  increase  the  trustworthiness  of  the  website,  but  it  can  increase  personal  information  disclosure  and  purchasing  intentions.    As  these  two  behaviors  represent  the  majority  of  desired  outcomes  for  online  stores  and  services,  companies  have  little  to  lose  by  protecting  consumer  information  and  prominently  displaying  those  intentions  on  websites.  Privacy  and  Perceived  Control  Outweigh  the  Benefits  of  Personalization     Companies  often  request  personal  information  from  users  to  create  a  more  personalized  online  experience.    Since  online  technologies  allow  for  displays  of  dynamic  content,  potentially  different  for  every  website  visitor,  shopping  and  service  experiences  online  can  be  highly-­‐tailored  based  on  a  number  of  preferences  and  identifying  information,  such  as  location.    Yet,  the  literature  indicates  that  users  still  value  privacy,  and  by  extension,  perceived  user  control  over  personal  data,  to  a  personalized  experience.    
    • HOW  WE  DECIDE  ONLINE     8     This  is  not  to  suggest  that  users  do  not  see  value  in  a  personalized  experience.    In  an  experiment  with  238  undergraduate  students  in  Korea,  researchers  used  a  2  x  2  experimental  design  with  four  versions  of  a  dummy  travel  website,  pretested  to  ensure  the  stimuli  in  each  cell  were  explicit  (Jungkook  &  Xinran,  2010).    The  website  designs  included  conditions  for  high  or  low  personalization  and  high  or  low  privacy.    The  results  did  show  that  both  increased  personalization  and  privacy  increased  the  behavioral  intent  of  the  users,  including  greater  intent  to  purchase  online  and  greater  willingness  to  use  the  website.    However,  the  increased  behavioral  intent  was  more  significant  for  the  group  with  the  high  privacy  stimuli.       System  personalization  is  not  the  only  mechanism  for  creating  an  online  experience  specific  to  each  online  user’s  preferences.    Many  websites  allow  for  customization  of  settings  by  the  user,  rather  than  the  system  or  website  itself.    When  faced  with  risks  to  privacy,  technology-­‐savvy  users  prefer  to  control  their  own  data  through  user  customizations  (Sundar  &  Marathe,  2010).    In  an  experiment  with  70  undergraduate  students,  researchers  used  a  2  x  2  design  to  measure  changes  in  attitude  towards  a  website  with  conditions  for  high  or  low  privacy  and  system  personalization  or  user  customization.  In  this  study,  users  with  a  high  level  of  technology  self-­‐efficacy,  or  “power  users”,  preferred  user  customization  when  in  a  condition  of  low  privacy  and  system  personalization  only  in  a  condition  of  high  privacy.    Although  this  study  isolates  a  group  with  higher-­‐than-­‐average  technology  acumen,  the  results  show  that  personalization  is  preferred  only  when  privacy  is  assured.   Taylor,  Davis,  &  Jillapalli  (2009)  echo  this  preference  for  control  over  personal  information,  suggesting  that  users  with  little  control  over  their  personal  information  are  
    • HOW  WE  DECIDE  ONLINE     9  less  likely  to  purchase  online.    In  a  2  x  3  experimental  design  with  394  undergraduates  from  the  southwestern  United  States,  they  evaluated  how  control  of  one’s  data  affects  trust  in  an  online  vendor  using  low  or  high  data  control  cells.    Researchers  found  that  low  control  over  personal  data,  even  when  used  to  create  a  more  personalized  experience,  strengthened  the  significant  negative  relationship  between  privacy  concerns  and  behavioral  intention.    Without  an  explicit  agreement  to  release  information,  the  users  privacy  concerns  reduced  their  intentions  to  purchase  online.   Although  advancements  in  technology  have  enabled  companies  to  create  websites  that  are  tailored  to  consumer  preferences,  consumers  do  not  appear  to  value  this  benefit  over  strong  privacy  intentions,  and  ultimately,  control  over  their  own  personal  information.    While  personalization  and  customization  can  be  attractive  to  users,  privacy  remains  key.  Privacy  Willingly  Compromised  for  Convenience  and  Compensation   Although  the  previous  literature  has  shown  privacy  as  a  primarily  influencer  in  the  decision  to  disclose  information  or  transact  online,  other  user  benefits  can  decrease  its  importance.    The  literature  shows  that  both  convenience,  or  time  saving,  and  compensation  can  influence  consumers  to  forego  privacy  concerns.   In  one  of  the  few  studies  evaluating  information  disclosure  and  privacy  on  online  social  networking  sites,  researchers  found  that  convenience,  specifically  convenience  of  maintaining  relationships,  had  the  strongest  influence  on  willingness  to  disclose  information  online  (Krasnova  et  al.,  2010).    Researchers  used  ads  on  the  two  most  popular  online  social  networks  in  Germany,  Facebook  and  StudiVZ,  to  attract  270  online  social  networking  users  to  participate.  The  final  net  sample  totaled  259,  including  85.8%  students  
    • HOW  WE  DECIDE  ONLINE     10  and  86.2%  individuals  between  20  and  29  years  old.      A  significant  negative  interaction  was  found  between  perceived  privacy  risk  and  willingness  to  disclose  online,  and  a  significant  positive  interaction  was  found  between  convenience  of  services  and  willingness  to  disclose  online.    As  concerns  over  privacy  reduced  and  services  were  deemed  more  convenient,  users  were  more  willing  to  disclose  information.    However,  the  impact  of  convenience  was  stronger.   The  convenience  of  using  an  easy-­‐to-­‐remember  password  and  the  ability  to  share  a  password  with  trusted  contacts  can  also  override  privacy  concerns  (Tam,  Glassman,  &  Vandenwuver,  2010).    In  an  online  survey  of  133  university  students,  researchers  evaluated  motivations  and  behaviors  related  to  password  security,  where  75.9%  of  respondents  indicated  their  top  security  concern  as  protecting  information  to  preserve  privacy  (rather  than  risk  of  identity  theft,  for  example).    The  results  showed  that  even  though  users  understood  how  to  create  secure  passwords,  they  were  more  concerned  with  loss  of  convenience.    Users  willingly  compromised  their  security  in  exchange  for  the  convenience  of  not  forgetting  a  password.   In  addition  to  convenience,  consumers  may  exchange  information  for  monetary  compensation.    Researchers  conducted  an  experiment  with  268  undergraduate  and  graduate  students  from  the  United  States  and  Singapore,  assigning  websites  from  different  industries  for  subjects  to  evaluate,  each  offering  different  amounts  of  financial  reward  and  different  time  investments  on  the  part  of  the  visitor  (Hann,  Hui,  Tom  Lee,  &  Png,  2007).    The  results  showed  that  convenience  and  monetary  rewards  can  positively  impact  desired  behavioral  motivations.    By  isolating  each  variable  and  assigning  a  universal  value  for  each  level  of  privacy,  time-­‐saving  or  financial  reward,  researchers  found  that  in  the  United  
    • HOW  WE  DECIDE  ONLINE     11  States,  consumers  are  willing  to  forego  privacy  in  exchange  for  compensation  between  $30.49  and  $44.62.         These  studies  show  that  while  privacy  is  still  an  important  factor  in  decision  making  online,  offers  of  convenience  and  compensation  can  be  more  powerful.    As  Tam  et  al.  (2010)  show,  users  may  even  choose  convenience  when  they  know  their  behavior  may  risk  privacy  or  security.         The  literature  suggests  that  indicators  of  privacy  can  be  powerful  motivators  in  shaping  attitudes  and  influencing  behavior  online.    Although  most  of  the  literature  suggests  that  privacy  is  a  primary  factor  in  the  determination  to  disclosure  information  or  transact  (Bernard  &  Makienko,  2011;  Joinson  et  al.,  2010;  Tsai  et  al.,  2011),  the  lure  of  convenience  and  compensation  can  cause  consumers  to  relinquish  control  over  privacy.    Some  conflicting  and  almost  paradoxical  results  suggest  that  users  may  simultaneously  pay  a  small  premium  for  privacy  (Tsai  et  al.,  2011;  Mai  et  al.,  2010);  yet,  also  sacrifice  privacy  in  exchange  for  compensation  (Hann  et  al.,  2007).    Considering  the  breadth  of  quantitative  research  on  this  topic,  these  results  are  not  surprising;  the  decision-­‐making  process  and  underlying  motivations  that  yield  behavior  change  online  can  be  better  understood  through  a  qualitative  approach.     RQ1:  How  are  risks  and  benefits  evaluated  during  the  process  of  disclosing  personal     information  online?   Method     As  the  literature  shows,  most  studies  of  privacy  online  have  utilized  quantitative  methods,  especially  experimental  methods,  to  measure  the  impacts  of  privacy,  security  and  
    • HOW  WE  DECIDE  ONLINE     12  trust  on  attitudes,  behavioral  intentions  and  actual  behavior.    However,  these  methods  have  not  yielded  a  good  understanding  of  the  complex  process  that  online  users  undertake  when  deciding  to  provide  personal  information  online.    Qualitative  methods,  however,  offer  insight  into  complex  thoughts  and  emotional  processes  (Saldaña,  2011).    This  research  will  use  a  phenomenological  approach  in  order  to  uncover  motivations  and  feelings  behind  the  decision  to  transact  online.    Phenomenology  investigates  the  emotions  and  perceptions  of  individuals  shaped  by  their  own  life  experiences  that  can  create  a  shared  understanding;  this  approach  of  understanding  the  individual’s  perspective  is  best  served  through  in-­‐depth  interviews  (Daymon  &  Holloway,  2011).   This  research  method  has  a  few  limitations.    As  expected  with  a  qualitative  research  study,  one  limitation  to  this  research  is  the  lack  of  generalizability.    While  phenomenology  does  attempt  to  explain  a  process  outside  the  experiences  of  a  specific  people,  attempting  to  generalize  an  experience,  the  sample  is  relatively  small  (Saldaña,  2011).    Additionally,  this  research  approach  does  not  allow  for  any  analysis  of  causality,  or  any  firm  measure  of  value.    The  almost  narrative  nature  of  the  study  presents,  in  some  cases,  a  sequence  of  events,  but  without  qualitative  and  statistical  analysis,  lacks  firm  evidence  of  causality.      Finally,  in-­‐depth  interviews  can  result  in  fabricated  data,  created  by  the  interviewee  to  hide  potentially  embarrassing  or  ego-­‐bruising  details  (Daymon  &  Holloway,  2011).    Considering  some  of  the  differences  noted  in  attitudes  and  behavior  related  to  online  privacy,  (McGrath,  2011),  participants  might  be  inclined  to  answer  less  than  truthfully.  Participants     As  referenced  in  the  statement  of  purpose,  this  research  project  will  focus  on  Generation  Y,  or  those  in  the  18-­‐29-­‐age  range.    This  particular  generation  has  a  94%  
    • HOW  WE  DECIDE  ONLINE     13  Internet  usage  rate  as  of  August  2011  and  is  soon  to  be  an  economic  powerhouse,  estimated  to  comprise  75%  of  the  workforce  by  2025  (Zickuhr  &  Smith,  2012;  Dhawan,  2012).      This  homogenous  sample  will  be  collected  from  the  general  population  of  Washington,  DC.  Instruments     The  first  instrument  needed  for  this  research  plan  is  a  Participant  Recruitment  Notice  (see  Appendix  A)  that  includes  a  link  to  the  pre-­‐screening  survey  and  a  high-­‐level  overview  of  the  research  project.    The  notice  includes  two  qualifying  details  in  the  text,  the  desired  18-­‐29  years  old  age  range  of  participants,  and  that  the  interviews  will  be  conducted  in  person  in  Washington,  DC.    Additionally,  the  notice  advertises  the  needed  for  participants  to  complete  a  survey  in  order  to  qualify  for  research  plus  a  reference  to  the  $20  gift  card  offered  as  compensation  for  approximately  one  hour  of  time.     The  second  instrument  is  the  pre-­‐screening  survey  (see  Appendix  B),  intended  to  qualify  participants  for  the  interviewing  process.    In  addition  to  using  the  pre-­‐screening  survey  to  isolate  the  participant  age  range  previously  identified,  the  screening  will  seek  to  identify  any  outliers  for  elimination  related  to  online  behavior.    The  participant  age  group  was  specifically  selected  to  avoid  vast  differences  in  Internet  experience,  as  online  self-­‐efficacy  can  significantly  impact  perceptions  of  privacy  and  trust  online  (Bernard  &  Makienko,  2011;  Sundar  &  Marathe,  2010).    The  use  of  a  5-­‐point  Likert  scale  to  measure  Internet  self-­‐efficacy  will  allow  me  to  later  pinpoint  a  mean  level  of  Internet  usage.      Additionally,  to  control  for  impacts  of  education,  as  higher  levels  of  education  correlate  with  higher  Internet  usage  (Zickuhr  &  Smith,  2012),  the  survey  also  asks  for  education  level.    However,  to  ensure  participants  have  used  some  common  online  services,  the  survey  
    • HOW  WE  DECIDE  ONLINE     14  asks  if  the  user  has  a  Facebook  profile,  or  has  shopped  on  Amazon.com.    As  the  top  social  networking  site  and  the  top  online  retailer  respectively  (Messieh,  2012;  Hwang,  2012),  these  sites  set  a  baseline  expectation  for  an  online  experience.     The  third  instrument  is  the  in-­‐depth  interview  guide  (see  Appendix  C).    The  interview  guide  was  designed  with  the  constructs  of  the  theory  of  privacy  calculus,  namely,  willingness  to  provide  personal  information  during  internet  transactions,  perceived  internet  privacy  risk,  internet  privacy  concerns,  internet  trust,  and  personal  internet  interest  (Dinev  &  Hart,  2006).    Each  question  has  been  devised  to  uncover  a  thought  process  and  motivation  behind  attitudes  and  behaviors.  Procedure     The  research  will  commence  on  July  1,  2012  with  a  Participant  Recruitment  Notice  (see  Appendix  A)  that  will  be  sent  to  all  DC  metro  universities,  including  The  Johns  Hopkins  University,  Georgetown  University,  George  Washington  University,  American  University,  Catholic  University,  and  George  Mason  University,  for  subsequent  circulation  through  university  online  bulletin  boards  and  email  distribution  lists.    Additionally,  an  ad  will  be  placed  on  Craigslist.org  once  a  week  during  the  four-­‐week  period  the  survey  is  open.    Posting  the  notice  weekly  will  allow  users  to  find  the  listing  more  easily,  as  recent  listings  appear  at  the  top  of  the  ad  lists.    The  notice  will  include  a  link  to  the  pre-­‐screening  survey  and  mention  of  the  $20  compensation  for  participation  in  in-­‐person  interviews,  if  the  interview  is  completed.     The  online  pre-­‐screening  survey  will  close  on  August  1,  2012,  after  being  open  for  30  days.    The  pre-­‐screening  survey  will  eliminate  some  potential  participants  in  a  number  of  ways.    First,  those  who  do  not  complete  all  survey  questions  and  those  outside  of  the  18-­‐
    • HOW  WE  DECIDE  ONLINE     15  29  year  old  age  group  will  be  removed.    Additionally,  those  without  some  college  education  or  more,  and  those  without  a  Facebook  profile  or  those  who  have  not  shopped  on  Amazon.com  will  be  removed.     Section  two  of  the  pre-­‐screening  survey  contains  Internet  usage,  experience  and  self-­‐efficacy  questions  that  will  be  used  to  calculate  behavioral  means  to  identify  any  outliers.    Individuals  falling  more  than  one  degree  on  the  Likert  scale  from  the  mean  will  be  disqualified.   With  the  final  list  of  qualified  applicants  prepared,  contacts  will  be  randomly  chosen  by  lottery  and  contacted  to  schedule  an  in-­‐person  interview.    The  location  for  all  interviews  will  be  offices  of  Personal,  Inc.  in  the  Georgetown  neighborhood  of  Washington,  DC.    In  addition  to  being  a  neutral  location  for  meeting,  as  Personal’s  mission  is  to  give  consumers  control  over  personal  data,  they  are  interested  in  the  outcome  of  the  research  project.    Interview  candidates  will  be  contacted  between  August  1  and  August  15,  2012.    A  total  of  40  interviews  will  be  conducted  between  August  15  and  September  30,  2012.       The  in-­‐depth  interviews  will  be  audio-­‐recorded  for  future  transcription.    Upon  completion  of  research,  all  reference  to  subject  names  and  other  contact  information,  including  any  email  or  voicemail  exchanges  used  during  the  recruitment  process  will  be  deleted.  Analysis     Considering  this  is  a  phenomenological  approach  to  research,  “the  primary  task  is  researcher  reflection  on  the  data  to  capture  the  essence  and  essentials  of  the  experience  that  make  it  what  it  is”  (Saldaña,  2011,  Chapter  1,  Section  2,  para.  15).      After  transcription,  the  goal  of  the  analysis  will  be  to  identify  common  themes,  either  explicit  or  implicit.    This  
    • HOW  WE  DECIDE  ONLINE     16  process  of  coding  into  categories  and  subcategories  will  allow  for  a  better  organization  of  the  research  and  find  commonalities  in  experiences  (Daymon  &  Holloway,  2011).    Additionally,  wherever  possible,  the  researcher  will  identify  a  sequence  of  activities  in  order  to  better  understand  the  process  of  privacy  calculus.            
    • HOW  WE  DECIDE  ONLINE     17   Appendix  A   Participant  Recruitment  Notice    Request  for  Participants,  to  be  posted  online  July  1,  2012.    Get  a  $20  Gift  card  for  participation  in  valuable  research    As  part  of  a  research  project  at  The  Johns  Hopkins  University,  I  am  looking  for  individuals  between  the  ages  of  18  and  30  willing  to  answer  questions  regarding  how  you  decide  to  use  websites—including  online  stores,  social  networks,  and  other  online  services.        After  completion  of  an  online  survey  to  determine  eligibility,  participants  chosen  to  participate  in  the  study  will  receive  a  $20  gift  card  in  exchange  for  an  hour-­‐long  interview.    All  interviews  will  be  conducted  in-­‐person  at  the  offices  of  Personal,  Inc.  in  the  Georgetown  neighborhood  of  DC.    Interested?    Click  here  to  complete  the  online  survey.        Those  eligible  will  be  contacted  between  August  1,  2012  and  August  15,  2012  to  schedule  an  interview.        
    • HOW  WE  DECIDE  ONLINE     18   Appendix  B   Pre-­‐interview  Participant  Screening  Online  Survey     The  following  questions  are  designed  to  determine  your  eligibility  to  participate  in  a  research  project  exploring  the  decision-­‐making  process  of  consumers  as  they  buy  products  or  use  services  online.    Please  answer  all  questions  honestly.    If  you  are  eligible  for  participation,  you  will  be  contacted  between  August  1,  2012  and  August  15,  2012  via  email  and  phone  to  participate  in  an  in-­‐person  interview  at  the  offices  of  Personal,  Inc.  in  the  Georgetown  neighborhood  of  DC.    After  successful  completion  of  the  interview,  participants  will  receive  a  $20  gift  card.   Personal  information,  including  contact  name,  telephone  and  email,  will  never  be  disclosed  during  research,  and  will  be  destroyed  (files  deleted)  at  the  conclusion  of  all  interviews.    I.    Demographic  and  Contact  Information:  1. Please  indicate  your  age:       ___________  2. Please  indicate  your  gender:   ¢   ¢   ¢   FEMALE   MALE   PREFER  NOT  TO  SAY    3. Please  indicate  your  education  level:   ¢   ¢   ¢   ¢ ¢ SOME  HIGH   HIGH  SCHOOL   SOME  COLLEGE   COLLEGE  DEGREE   ADVANCED   SCHOOL   DEGREE   DEGREE    4. Please  provide  your  first  name  (for  interview  scheduling  purposes):   __________________________________________  
    • HOW  WE  DECIDE  ONLINE     19  5. Please  provide  your  telephone  number  (for  interview  scheduling  purposes):   __________________________________________  6. Please  provide  your  email  address  (for  interview  scheduling  purposes):   __________________________________________      II.    Online  experience  and  attitudes  1) I  have  a  Facebook  profile   ¢   ¢   YES   NO      2) I  have  shopped  online  at  Amazon.com   ¢   ¢   YES   NO      3) I  enjoy  technology   ¢   ¢   ¢   ¢   ¢   STRONGLY  DISAGREE   DISAGREE   NEUTRAL   AGREE   STRONGLY  AGREE              4) I  enjoy  spending  time  online   ¢   ¢   ¢   ¢   ¢   STRONGLY  DISAGREE   DISAGREE   NEUTRAL   AGREE   STRONGLY  AGREE  
    • HOW  WE  DECIDE  ONLINE     20    5) I  enjoy  shopping  online   ¢   ¢   ¢   ¢   ¢   STRONGLY  DISAGREE   DISAGREE   NEUTRAL   AGREE   STRONGLY  AGREE    6) I  enjoy  participating  in  social  networking  websites  (Facebook,  LinkedIn,  etc.)   ¢   ¢   ¢   ¢   ¢   STRONGLY  DISAGREE   DISAGREE   NEUTRAL   AGREE   STRONGLY  AGREE    7) I  consider  myself  a  “technophile”   ¢   ¢   ¢   ¢   ¢   STRONGLY  DISAGREE   DISAGREE   NEUTRAL   AGREE   STRONGLY  AGREE    8) I  adopt  new  technologies  and  devices  quickly   ¢   ¢   ¢   ¢   ¢   STRONGLY  DISAGREE   DISAGREE   NEUTRAL   AGREE   STRONGLY  AGREE    9) I  stay  informed  about  the  latest  technologies   ¢   ¢   ¢   ¢   ¢   STRONGLY  DISAGREE   DISAGREE   NEUTRAL   AGREE   STRONGLY  AGREE          
    • HOW  WE  DECIDE  ONLINE     21     Appendix  C     Interview  Guide    Introduction    Good  morning/afternoon!    Thank  you  for  agreeing  to  participate  in  this  research  study.    My  goal  is  to  understand  your  thought  process  when  using  a  website  that  asks  you  for  personal  information.    Let’s  get  started!    1) Willingness  to  provide  personal  information  to  transact  on  the  internet   a) If  a  website  asks  you  for  your  name  and  email  address,  how  do  you  decide  to  give   them  that  information?    Walk  me  through  your  evaluation.   i) If  this  company  asked  for  your  phone  number  and  address,  would  that  change   your  answer?   ii) If  this  company  also  asked  for  your  preferences,  such  as  favorite  brands,  music,   movies  and  books,  would  you  change  any  of  your  answer?     b) What  would  a  company  need  to  give  you  or  promise  you  in  order  for  you  to  disclose   that  information?     c) Are  there  any  circumstances  where  you  would  not  give  out  your  name  and  email   address?    
    • HOW  WE  DECIDE  ONLINE     22   d) If  a  company  offered  you  cash  for  your  personal  information  would  you  give  it  to   them?         i) Why  or  why  not?     ii) How  much  would  you  charge  them?    2) Perceived  internet  privacy  risk   a) Do  you  think  it’s  safe  to  shop  online?     b) What  are  the  risks  of  using  online  services?   i) How  do  you  know  these  risks?    3) Internet  privacy  concerns   a) How  often  do  you  read  privacy  policies  on  websites?     b) Has  reading  a  privacy  policy  ever  changed  your  mind  about  giving  a  website  any   personal  information?     c) Are  you  aware  that  some  websites  sell  your  personal  information?    If  you  knew   which  websites  sold  your  information,  would  you  stop  using  them?   i) What  if  that  website  was  Google  or  Facebook,  would  you  stop  using  them?    Why   or  why  not?    
    • HOW  WE  DECIDE  ONLINE     23    4) Internet  trust   a) Do  companies  protect  their  customers’  personal  information?   i) How  do  you  know?     b) Can  someone  shop  and  disclose  information  online  without  sacrificing  privacy?    5) Personal  internet  trust   a) How  do  you  decide  to  buy  something  on  a  particular  website  when  faced  with   several  different  stores  online?    Walk  me  through  your  thinking.     b) If  price  were  not  a  concern,  what  characteristics  would  cause  you  to  shop  on  one   website  over  another?     c) Is  there  anything  a  website  can  offer  that  would  cause  you  to  intentionally  pay  more   for  an  item?     d) How  do  you  feel  about  using  websites  that  ask  for  your  personal  preferences  to   create  personalized  recommendations  for  you?         i) How  do  you  feel  when  websites  don’t  ask  you,  but  have  clearly  used  that   information?          
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