Balancing web personalization and consumer privacy concerns: Mechanisms of consumer trust and reactance.

Information technology and e‐commerce enable websites to provide personalized services based on consumer information, thereby providing convenience to consumers. However, the collection and use of consumer information may trigger concerns regarding privacy invasion. Grounded in exchange theory, the current study constructs a framework that links web personalization to consumer decisions (i.e., website loyalty and purchase intention) through consumer trust and reactance. The study also uses reactance theory as the theoretical basis to examine the moderating role of privacy concerns. An online survey was used to assess the effect of web personalization on consumer loyalty. The results show that consumers' privacy concerns negatively moderate the relationship between web personalization and website loyalty, and the influencing mechanism differs according to the levels of privacy concerns. More specifically, when consumers are less concerned about privacy, web personalization strengthens consumer trust to enhance loyalty. When consumers are more concerned about privacy, web personalization affects their loyalty through psychological reactance. The study findings show that although personalized services provide convenience to consumers, websites should carefully consider consumers' privacy issues. The trade‐off between web personalization and privacy concerns is necessary for a website's success. [ABSTRACT FROM AUTHOR]