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Abstract
As businesses increasingly rely on granular consumer data, the public has increasingly pushed for enhanced regulation to protect consumersâ privacy. We provide a perspective based on the academic marketing literature that evaluates the various benefits and costs of existing and pending government regulations and corporate privacy policies. We make four key points. First, data-based personalized marketing is not automatically harmful. Second, consumers have heterogeneous privacy preferences, and privacy policies may unintentionally favor the preferences of the rich. Third, privacy regulations may stifle innovation by entrepreneurs who are more likely to cater to underserved, niche consumer segments. Fourth, privacy measures may favor large companies who have less need for third-party data and can afford compliance costs. We also discuss technology platformsâ recent proposals for privacy solutions that mitigate some of these harms but, again, in a way that might disadvantage small firms and entrepreneurs.
Citation
Jean-Pierre Dubé, John G. Lynch, Dirk Bergemann, Mert Demirer, Avi Goldfarb, Garrett Johnson, Anja Lambrecht, Tesary Lin, Anna Tuchman, Catherine Tucker (2025) Frontiers: The Intended and Unintended Consequences of Privacy Regulation for Consumer Marketing. Marketing Science 44(5):975-984.
@article{dube2025frontiers,
title={Frontiers: The Intended and Unintended Consequences of Privacy Regulation for Consumer Marketing},
author={Dub{\'e}, Jean-Pierre and Lynch, John G and Bergemann, Dirk and Demirer, Mert and Goldfarb, Avi and Johnson, Garrett and Lambrecht, Anja and Lin, Tesary and Tuchman, Anna and Tucker, Catherine},
journal={Marketing Science},
volume={44},
number={5},
pages={975-984},
year={2025},
publisher={INFORMS}
}