The Wake Of Invasive Marketing Methods

Published Date: 02 Nov 2017

Many organisations have recognised the need for greater consumer insight in order to serve consumers with the best quality goods and services the company can offer. Consumers now understand that without disclosing some form of personal information they cannot receive the best service from an organisation. The information revolution has helped facilitate the global connection of people in more ways than one. Consumers and companies have more power now with help from the internet than they have done in history. However, with this new found ability to communicate on unprecedented levels threats do occur and consumers do reflect some worry regarding the inappropriate use, collection and distribution of their information. In 2011 TRUSTe conducted a survey among 1,000 members of its online consumer panel and found that 38% were concerned about their privacy with 23% worried about security. This worry amongst consumers has grown and has not been helped with recent failings by companies such as Sony, Apple and AOL where they were at the forefront of a global privacy outrage.

The nature of privacy

The term privacy has had many different roles through time, but to fully understand privacy now it is important to look at the universal definitions from the past in relation to the present. Understanding the role of privacy in the past will identify the key changes that have occurred to its current form today.

Warren and Brandeis (1890) were one of the first authors to publish an article (Right to privacy) in the United States concerned with the terms and rights of privacy, they believed that with the growing power of the press and certain technological advances, information was being spread at a speed which was emotionally hurting people affected by the intrusion of privacy. They write that a man’s right to protection of bodily harm and other such tangible events are accepted however at the time a man’s emotional and psychological rights of protection were not widely recognised. Warren and Brandeis’ writing recognises the importance of each individual’s right to a realm of living that belongs to that individual only, where they have no limitations, constraints or uncalled for surveillance from outside factors. Over time with the development of technology the definition of privacy has become more specific since the Warren and Brandeis article other authors such as William Prosser (1960) have released concepts of the key areas that define privacy. In Prosser’s case he defined privacy with the four following steps:

One must be free from intrusion into their private affairs and their solitude and seclusion.

Freedom of unsanctioned revelations of personal information or the forced disclosure of such information

Use of a person’s image or name to promote or inform cannot be used without permission.

Protection of one’s image or name from being falsely portrayed in an untrue negative manner.

Prosser’s definitions begin to give a clearer picture of how a person’s privacy can be violated and also in what circumstances should a person be protected. Although, some aspects of the definitions may seem too broad, such as the use of the word intrusion which can mean so many forms of encroachment today such as physical harassment, excessive telephone calls, observing unprotected social media pages, all varying in different degrees of seriousness. The majority of people are familiar with ‘personal space’ and any contact within this space would most likely constitute an intrusion. The term ‘private affairs’ may also seem too vague, for example public areas of congregation may not be classed as an invasion of privacy with some people however many would not welcome encroachment in such circumstances.

Many international catalogues contain core principles of human rights that can be regarded as the central basis of forming data protection laws. The Universal Declaration of Human Rights of 1948 addresses privacy in Article 12:

‘No one shall be subjected to arbitrary interference with his privacy, family, home or correspondence, nor to attacks upon his honour and reputation. Everyone has the right to the protection of the law against such interference or attacks’

The above declaration only identifies that one’s privacy cannot be interfered with, however the European Court of Human Rights focuses on the ‘respect of private life’ in Article 8:

Everyone has the right to respect for his private and family life, his home and his correspondence.

There shall be no interference by a public authority with the exercise of this right except such as is in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of the rights and freedoms of others.

This definition expresses the right a person has to privacy, acknowledging privacy as a human right rather than a privilege. Authoritative literature such as the two above embrace a social acceptance of a person’s human right to privacy in their life, it helps create an understanding to determine whether the privacy rights of a consumer has been violated. They begin to make clear the universal views on an individual’s right to privacy and how they can be used for legal regulations.

Defining consumer privacy

A person’s human, legal and moral right to privacy has become more widely accepted, the majority of people understand and respect the need to allow room for living without unwarranted restraints from outside sources. However privacy within the marketplace has been a cause for scrutiny for some time especially with the introduction of e-commerce sites and online networking making information widely accessible. Increasingly marketers have identified the responsibility and risk involved when unveiling new products or services to uncertain market environments, recognising the competitive need for sophisticated research and planning on the wants, needs, attitudes and behaviour of potential customers (Kotler & Zaltman, 1971). This has resulted in many marketers using a broad variety of consumer databases to determine target audiences for their marketing programs (Thomas and Maurer 1997). Winer (2001) has noted that the information technology revolution and the World Wide Web has presented an opportunity to business’ which allows them to choose how they communicate with their customers in ways which weren’t previously conceivable offline. The ability to interact directly to requests made and serve the customer with a highly interactive, tailored experience has allowed organisations to create, improve and sustain long term relationships. Although a number of consumers appreciate the convenience of personalised services many authors have identified consumer concerns of sharing certain pieces of information such as annual income, personal references and personal data that may lead to other marketing offers, however consumers are willing to share demographic and lifestyle information (Nowak and Phelps 1992; Wang and Petrison 1993). Defining consumer privacy came from the early definitions of privacy which was ‘the right to be left alone’, and also the recent ideas of the control of social encounters and personal information (Lanier Clinton and Saini Amit, 2008). Goodwin (1991) attempted a definition of consumer privacy which was:

"the consumer’s ability to control (a) presence of other people in the environment during a market transaction or consumption behaviour and (b) dissemination of information related to or provided during such transactions or behaviours to those who were not present"

This early definition of consumer privacy encompassed two main elements, the first being the social dimensions of privacy touching upon the ability to have some control over the presence of other’s within the consumer’s environment during a transaction, such as the number of intrusions from other marketers and also the presence of other consumers within the environment (Lanier Clinton and Saini Amit, 2008; Milne and Gordon 1993). The second part of the definition relates to the marketing and professional use of the information provided by the consumer (Lanier Clinton and Saini Amit, 2008; Jones 1991). Interestingly, Milne and Gordon (1993) suggest that the consumers view of direct marketing, within the context of which the consumer exchanges information for requisitions, are that a social contract is created between the consumer and the corporate entity. They go on to write that a breach of this contract occurs when the consumer believes that their information is being used outside the expected pattern of use (Milne and Gordon, 1993). Goodwin (1991) identified from the two dimensions that occur from the definition, social privacy and information privacy, a categorisation is generated of four degrees of privacy control:

1. Total control

2. Environmental control

3. Disclosure Control

4. No control

Total control is the ability to control who is present within the environment and who knows about the transaction; this is considered the greatest extent to which a person can achieve full control of their information. Requesting information stay unlisted from databases is an example of total control behaviour; transactions made in this situation require the least amount of regulation (Goodwin, 1991). Environmental control illustrates the consumer’s ability to control who is present during the transaction and also where the transaction takes place, however they lose the authority over the disclosure of the information. Disclosure control occurs when the consumer’s environment is breached however the information disclosed remains undistributed; examples such as door-to-door surveys reflect this type of control as the respondents are rewarded concealment (Goodwin, 1991). These two forms of control present very average levels of privacy and thus would require some form of privacy regulation (Lainier and Saini, 2008). No control is the situation where the consumer has no authority over who is present or the distribution of the information shared. Uncalled for telephone calls from telemarketers and market researchers conducting research are examples where the gathering of data may seem apparent but the storing and sharing of this data is not clear. This portrays the least amount of privacy available and would require the most amount of regulation (Goodwin 1991; Laini and Saini 2008). The definition of consumer privacy as a basis of varying degrees of control (Goodwin 1991) has eventually been evolved to include consumer knowledge as another factor of the definition (Foxman & Kilcoyne 1993; Culnan 1995; Nowak and Phelps 1997). This expansion of the definition reflects on the level of consumer knowledge of which consumers are made aware of with regards to the information practices firms they interact with conduct and their privacy rights in relation to these interactions (Foxman and Kilcoyne 1993). Therefore consumer knowledge applies a number of important issues to the make-up of consumer privacy such as; how well does the consumer understand the reasons behind the collection of information (how, why and what?). Also, do consumers know how the information given will be used; will it be applied to secondary uses? Thirdly, are consumers made aware of their rights to take action, or are they compounded by any boundaries (Saini and Lainier 2008). Consumer privacy can be regarded as high when answers are favourable to these questions and it is low when the answers are negative (Foxman and Kilcoyne 1993).

Consumer right to privacy

Many authors identify the underlying need for consumer privacy in relation to the varying degrees of service. However, with the nature of privacy there derived a social acceptance of a human’s right to privacy; the same does not apply to consumer privacy (Lanier and Saini, 2008). Mascarenhas (2003), points out that consumer privacy advocates pursue a cause of better consumer-control of personal data. More opportunities should be made available to ensure consumers have more control over the process of collecting, storing, processing, dissemination and use of personal data. Many recent advocates of consumer privacy enforce the social contract theory whereby whenever the consumer provides personal information to a corporate entity the organisation has the responsibility to stay within the bounds of a social contract and withhold the information (Culnan 1995, Milne 2000). The famous article written by Warren and Brandeis (1890) outlined that the right to privacy was in instance the right to be left alone, centred on many social factors they highlighted privacy as a human right given to everyone from birth. Some arguments however show that consumer privacy does not fall into this category of an absolute right. Goodwin (1991) recognises several sources of conflict with consumer privacy.

Required service levels conflict with privacy provisions

Conflicts with consumer privacy rights and the rights of other consumer and market rights

Conflicts within the cost of privacy and consumer privacy

Conflicts between consumer privacy and social regulations of privacy.

A study conducted by Harris and Westin (1979) aimed to gather an understanding of public’s opinions towards privacy found that although consumers are not experiencing an invasion of privacy loss some understand that consumer society is requiring a loss of privacy. Therefore, some consumers are prepared to provide information in return of higher levels of service (Goodwin, 1991; Katz and Tassone 1990). Although a consumer’s right to privacy exists there also exists a right on behalf of the marketer who would feel socially entitled to use the data they have to form professional relationships (Lally, 1996). Consumer privacy regularly conflicts with the notion of consumer’s ‘right to be informed and freedom of choice’ along with a marketer’s ‘right to be left alone and free speech’ (Clark, 1978; Lanier and Saini, 2008). When consumers agree to participate in trading personal information for service, marketers must try and ensure consumers understand the benefits of doing so outweigh the costs. Some authors found that consumers want to take advantage of the economic benefits offered to them but are unwilling to sacrifice their privacy (Milne and Gordon 1993; Culnan 1991). Privacy is certainly an important right to the individual however certain circumstances dictate that the safety of the wider public is of greater priority and thus privacy must be compromised in these instances (Westin, 1967). Some societies will require surveillance of certain industries to maintain appropriate running and functioning and therefore consumer privacy may be sacrificed if it is considered a threat to the wellbeing of a wider society (Flaherty 1989; Etzioni 199).