The effects of consumers’ perceived privacy control on perceived privacy risk in location aware service

Abstract

With the emergence of location aware technologies, new business model such as location aware advertising has emerged. Novel technologies lead to more innovative communication opportunity in marketing since location aware technologies enable provider to offer highly targeted messages to consumer based on their specific location. However, location detection has problems on different dimension compared to online privacy because it reads out not only online data but also consumers’ real world identity. Accordingly, this advanced technology increases consumers’ risk perception and it should be strongly addressed because it affects intention to adopt services. This study figured out perceived control over personal information as a predictor of perceived risk. Moreover, this study focuses on specific control assurance of the availability of the right to control over time and location when providing location information. Since location aware service is relatively new and emerging, we adopted the scenario based method, operationalize conditions of time and location in an 2x2 experimental study. The results indicated that perceived control is a significant predictor of perceived risk, and control assurances on time and location respectively enhances control perception, and alleviates risk perception. However, when they are combined, effectiveness becomes much more significant.