Innovation Law and Policy Workshop
Avi Goldfarb
Associate Professor of Marketing, Rotman School of Management
University of Toronto
Privacy regulation and online advertising
by Avi Goldfarb and Catherine Tucker (MIT Sloan)
Wednesday, November 17, 2010
12:30 p.m. – 2:00 p.m.
Solarium (FA2)
Falconer Hall, 84 Queen’s Park
Advertisers use online customer data to target their marketing appeals. This has heightened consumers' privacy concerns, leading governments to pass laws designed to protect consumer privacy by restricting the use of data and by restricting online tracking techniques used by websites. We use the responses of 3.3 million survey-takers who had been randomly exposed to 9,596 online display (banner) advertising campaigns to explore how privacy regulation in the European Union has influenced advertising effectiveness. This privacy regulation restricted advertisers' ability to collect data on web users in order to target ad campaigns. We find that on average, display advertising became far less effective at changing stated purchase intent after the EU laws were enacted, relative to display advertising in other countries. The loss in effectiveness was more pronounced for websites that had general content (such as news sites), where non-data-driven targeting is particularly hard to do. The loss of effectiveness was also more pronounced for ads with a smaller presence on the webpage and for ads that did not have additional interactive, video, or audio features.
AVI GOLDFARB is Associate Professor of Marketing at the Rotman School of Management, University of Toronto. He received his Ph.D. in economics from Northwestern University. His research explores brand value, behavioral modeling in industrial organization, and the impact of information technology on marketing, on universities, and on the economy. Professor Goldfarb has published over 30 articles in a variety of outlets, including the American Economic Review, Marketing Science, Management Science, the Journal of International Economics, the Journal of Economics and Management Strategy, and the Journal of Marketing Research. He is a co-editor at the Journal of Economics and Management Strategy, and an associate editor at Management Science, Quantitative Marketing and Economics, the International Journal of Industrial Organization and Information Economics and Policy.
A light lunch will be provided.
For more information, please e-mail
Ariel Katz at
ariel.katz@utoronto.ca
