Behind the screens. Privacy and advertising preferences in VoD —the role of privacy concerns, persuasion knowledge, and experience

Abstract

This study explores stated preferences for privacy and advertising in the Video on Demand (VoD) context, focusing on Netflix subscribers in Poland. We investigate how privacy concerns, persuasion knowledge, and consumer experience affect these preferences. The study design involved a hypothetical regulatory scenario that mandated platforms to either guarantee minimal data usage or offer compensation for data sharing. Within a discrete choice experiment framework, study participants were presented with hypothetical scenarios and asked to choose between three types of subscription plans, varying in the extent of personal data sharing and ad support. Additionally, a treatment was introduced in which respondents interacted with a mock Netflix environment to enhance their recognition of data practices and increase familiarity with hypothetical outcomes through a simulated experience. Responses from 2087 participants were analyzed using hybrid choice modeling. The results reveal that users are sensitive to the disclosure of personal information in the context of VoD, yet they are open to accepting monetary compensation for a certain degree of sharing. Users with greater persuasion knowledge are more willing to exchange data for discounts, provided the plans do not include personalized ads. Conversely, users with higher privacy concerns prefer plans with minimal data sharing, even when discounts are offered. We observe direct effects of the treatment on both privacy valuation and advertising preferences, particularly regarding time, with the treatment group being significantly more sensitive to ad length. In addition, the treatment group exhibits reduced privacy concerns and no significant difference in persuasion knowledge. Our findings suggest that VoD providers could enhance user control over their data and emphasize transparency, aligning with the increasing reliance on data-driven business models.