If you’re someone who regularly browses the internet, then you’ve more than likely run across pop-up and banner ads. More often than not they advertise products and services that you may not even need, but they have recently evolved. By looking through your internet history, ads are now much more tuned into the things that you may be interested in as a consumer. However, researchers are finding that this can either help or severely hurt the chances of you buying what is advertised.
Alexander Bleier and Maik Eisenbeiss, who are marketing professors at Boston College and the University of Bremen respectively, say that the amount of trust that a consumer has in a particular vendor ultimately affects whether or not they will accept or reject a banner ad.
The two professors conducted a study in which they showed consumers personalized ads that were tailored by each participant’s browser history. This information included what websites each person visited, what they had previously shopped for online, and varying information on their interests and hobbies. They wanted to find the point at which consumers became uncomfortable with having their online histories reflected back at them.
Prior positive experience is important
Bleier and Eisenbeiss found that consumers were much more likely to be responsive to ads if they had a good history with the company that supported them. “For the more trusted retailer in our field study, we find banner click-through rates to increase by 27 percent,” they said.
Consumers seemed to like personal ads more than general ones, but only to a certain extent. Their negative responses were elicited by ads that made them fear for their privacy. This was especially true for companies that consumers couldn’t recognize or did not have a positive experience with beforehand. It made the ads seem much more invasive.
Bleier and Eisenbeiss stress that it is important for companies to be careful when creating personalized banner ads. If they aren’t, then consumers may flat-out refuse to buy their products and may avoid the company in the future. Their full study, entitled “The Importance of Trust for Personalized Online Advertising”, has been published in the Journal of Retailing.