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The Marketing Architects
Nerd Alert: When Personalized Ads Become Creepy
00:09:12
Welcome to Nerd Alert, a series of special episodes bridging the gap between marketing academia and practitioners. We're breaking down highly involved, complex research into plain language and takeaways any marketer can use. In this episode, Elena...
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- [00:00]
A
Nerd alert. Learning is important, right?
- [00:02]
B
Yes, exactly. What a bunch of nerds.
- [00:05]
A
Nerd alert.
- [00:06]
B
Right? Marketing Architects. Hello and welcome to the Marketing Architects, a research first podcast dedicated to answering your toughest marketing questions. I'm Lana Jasper. I run the marketing team here at Marketing Architects, and I'm joined by my co host. Rob Demar is the chief product architect of misfits and machines.
- [00:23]
A
Howdy, Alaina.
- [00:25]
B
Hello. We're back with your weekly Nerd Alert. Every week I'll take a deep dive into academic marketing research and translate its complex ideas into simple, understandable language for Rob and of course, for all of you. Are you ready to nerd out, Rob?
- [00:36]
A
I'm so ready to nerd out. And ad just recommended a product I literally already own and I felt genuinely judged by a robot. So let's process this together, Alaina.
- [00:48]
B
Let's process it. That's exactly what we're talking about today. We're talking about that moment that you felt where a helpful ad or an ad that's supposed to be helpful turns into something that feels kind of creepy. And we all should probably be familiar with that feeling. An ad shows up. Maybe it addresses you by your name. Maybe it knows where you shopped last week. It knows exactly what you bought. And sometimes that's convenient. Sometimes it's a little creepy. So, Rob, before we get into this study, in particular, when an ad uses intense personalization, does that feel helpful to you or does it start to feel a little bit odd?
- [01:22]
A
I think it's a kind of a double edged sword. There are times where you feel like, gosh, that was like a really good waiter that just like learned your order and they're kind of thoughtful. But then, then it's. The other side of it is that's a little creepy. How are you figuring that out about me? So I think it's. If I, if I had to pick one side of the sword or the other, I start getting creeped out. I sometimes feel like I never even searched for that and you're showing me ads for it. Like, is Siri, like selling my, my info or something?
- [01:54]
B
Yeah, I get creeped out. When have you ever had an ad hit you that you had just been speaking about? Like just. You literally were talking about something. Yes, that, that's totally, totally. Yeah, yeah.
- [02:04]
A
No, Susie, my wife says that all the time. That, like, look at, they're listening because stuff is showing up.
- [02:09]
B
I don't like that. And I also don't like when I get ads that are clearly something my husband's been looking At I get Porsche ads like, okay, like. Or I get, like, you know, men's clothing or stuff like, that's very personalized to him.
- [02:22]
A
I have two 20 year olds in the house on our Amazon account. I'm pretty used to seeing some weird
- [02:27]
B
show that doesn't bother you? Okay. This paper is titled Triggering the Personalization Backfire Effect, the Moderating Role of Situational Privacy Concern. It's by H. Kim and S. Han at a university in Seoul, South Korea. And this was published just last year in the Journal of Behavioral Sciences. So we all know we've talked about this on the show before. We are not anti personalization as a podcast. We all know that it works to an extent. If you use someone's data, the ad feels relevant. On average, they're going to like it more, you're going to sell more. But there's an exception. There's a line that every consumer has felt sometimes being more personal is worse, not better. So what the study wanted to do is figure out exactly when does that flip happen. So before I give it away, Rob, do you want to make a prediction? At what point do you think a personalized ad goes too far?
- [03:19]
A
When it knows you're pregnant before you do. How's that?
- [03:23]
B
I mean, very specific.
- [03:24]
A
You heard that famous Target story, right? I mean, yeah. So that, that's where I'm. I'm getting creeped out.
- [03:30]
B
Okay. All right, well, the study's going to be a little more precise than that, so let me walk you through it. We're going to talk about the first, how it was set up, how they tested it, and then we'll get into the answer. So they ran an experiment with 360 people in South Korea. Everyone got a fake identity, and they shopped at a specific grocery store twice a month, and they spend just the equivalent of US$75. Then the researchers did two things. First, they changed how worried people felt about privacy. So half the group read a very scary news article about Google and Meta getting fined, customer data getting leaked. The other half read a boring article about fall interior design trends. Then they showed everyone a coupon ad from the grocery store, but at three different levels of personal. So the low level was generic. Hey, customer, here's 20% off the median level. User location coupons at stores within 1km of you. And the high level used everything. It was your name, the store you visited, even the exact amount you had spent the week before. So the researchers called this the intrusiveness ladder. Each rung climbs from anonymous to deeply personal. And Then they measured how much people wanted to buy when people were calm. So when they were in that group that read the boring article, the latter worked just like you'd expect. More personal actually meant more buying. The location and even the name and history ad beat both of the more generic ones. But when people were scared and they're kind of riled up about privacy, it all flipped. The medium ad just using location still did well. So that actually outperformed the most generic one. But the most personal one, the one with your name, your shopping history totally collapsed. So that didn't even beat the generic hey, customer ad. That was at the level one of the ladder. All of that personal data ended up buying them nothing. So there is this backfire effect where the ads the same. The only thing that changed was whether you just read something that made you privacy conscious. So, Rob, does it surprise you that one news article was powerful enough to wipe out the advantage of knowing someone's name and even their entire purchase history?
- [05:29]
A
Not at all. I think it's only increasing right now. I think we're getting more and more of a fear of a kind of a nanny state in general. And so it doesn't surprise me that there's a. There's just a growing concern over it.
- [05:44]
B
Yeah, and what I thought was interesting too is the groups were divided. It's not like you had, like, older consumers in one group. They just completely divided it randomly. And then all you saw was that article. So that's an issue, right, for marketers, advertisers that, like, it's not even a fixed personality type. It's not like there's a certain type of person that's just going to hate this stuff.
- [06:06]
A
That's a great point.
- [06:07]
B
Right. Like, that was the old thinking. It's like, well, some people really care about privacy and some people don't. This study is saying that's not the case. The same person can be fine with a creepy ad on Monday and offended by it on Tuesday. I feel like I felt this in my own behavior. Like, some days you're just more annoying a hundred percent.
- [06:22]
A
I mean, I literally am fine with everyone knowing anything about me most of the time, yet I don't allow apps to track me on my iPhone. When it's like, let me help you improve your experience. You know, they even try to position it well. And I'm like, no, I don't know why.
- [06:41]
B
Me too. I do the same thing. I'm like, you know what? No, can't do that. I do the same thing. That's so funny. And we're marketers and we're just like, you know what? No, I'm not, I'm not into that today. Okay. So kind of interesting. It's less about like who in your audience is sensitive. It's more about when are they sensitive and what is your confidence when you're putting out very personalized advertising. And then there's a whole issue too of how to even do that. The expense, the targeting. That's a different. A different podcast. But a few quick takeaways. Don't assume more personal is always better. There's a ceiling. If you cross it, it can cost you. Watch your. The context your ad lands in. So you know, if Mark Zuckerberg is in Washington D.C. sitting there looking awkward, getting in trouble, maybe don't put out this personalized advertising because people might be extra sensitive to it. When in doubt, lean on context over identity. So location based near you beat like the name and history ad when we talk about that ladder almost everywhere. So it felt relevant without feeling like surveillance. So contextual could be a way to go. And then they also recommend testing. Could you a B test to figure out like they did, just how personal can you go to find the sweet spot? We want to be smarter with our ads. We don't want to be. Want anyone thinking that we're creepy. Okay. Think of personalization. This is the Rob GPT. Sorry, I was just laughing thinking about it. Think of personalization like standing close to someone at a party when everyone's relaxed. Leaning in to talk to someone can feel warm and friendly. But the second someone yells watch your wallet from across the room, that same closeness suddenly feels like a pickpocket sizing you up. You didn't move an inch, but the feeling in the room just changed. That's a privacy scare. Turning your helpful ad into a creep. I like that one.
- [08:18]
A
That was a really good one. I understood that. Did it say in there that age had any factor to this?
- [08:26]
B
No, that wasn't included. I was saying like when the groups were divided, it's not like they divided them by age. But I'd be curious if, because we always think that. That older consumers have more of an issue.
- [08:36]
A
Yeah, I'm actually curious with. You know, I've got young 20 somethings who've grown up much more in the world of social and I just wonder if it's actually higher or the opposite.
- [08:47]
B
Yeah, that'd be a separate Interesting study to run probably. Okay, that's it for this episode of the Marketing Architects. We'd like to thank Taylor De Los Reyes for producing the show. You can connect with us on LinkedIn. And if you like the podcast, please leave us a review. Now go forth and build great marketing architects.