“This App Would Like to Use Your Current Location to Better Serve You”: Importance of User Assent and System Transparency in Personalized Mobile Services

Modern mobile apps aim to provide personalized services without appearing intrusive. A common strategy is to let the user initiate the service request (e.g., “click here to receive coupons for your favorite products”), a practice known as “overt personalization.” Another strategy is to assuage users’ privacy concerns by being transparent about how their data would be collected, utilized and stored. To test these two strategies, we conducted a 2 (Personalization: Overt vs. Covert) x 2 (Transparency: High vs. Low) factorial experiment, with a fifth control condition. Participants (N=302) interacted with GreenByMe, a prototype of an eco-friendly mobile application. Data show that overt personalization affects perceived control. Significant three-way interactions between power usage, perceived overt personalization and perceived information transparency was seen on perceived ease of use, trust in the app, user engagement and behavioral intention to use the app in the future. In addition, results reveal that perceived information transparency also promotes trust, which is negatively linked with privacy concerns and positively correlated with user engagement and product involvement.