Professional Documents
Culture Documents
Contemporary Issues in Digital Marketing
Contemporary Issues in Digital Marketing
Marketing
This book presents a comprehensive overview of the key topics, best practices, future
opportunities and challenges in the Digital Marketing discourse. With contributions from
world-renowned experts, the book covers:
Unique in its rigorous, research-driven and accessible approach to the subject of Digital
Marketing, this text is valuable supplementary reading for advanced undergraduate and
postgraduate students studying Digital and Social Media Marketing, Customer Experience
Management, Digital Analytics and Digital Transformation.
1 Introduction 1
OUTI NIININEN
SECTION 1
Data analytics and measurement 7
SECTION 2
Digital transformation and innovations in marketing 47
SECTION 4
Ethics and privacy in digital marketing 117
SECTION 5
The future for digital marketing communications and conclusions 163
16 Conclusions 176
O U TI N I I N INE N
Index 182
Contributors
DOI: 10.4324/9781003093909-1
2 Outi Niininen
Lenovo to refne their product features, and the dynamic pricing modelling example from
a US-based major league baseball team’s ticket pricing allows several daily checks for the
ticket price that fans are willing to pay for each game. The location-based (Place) applica-
tions of Big Data have never been more important than today when precious COVID-19
vaccinations need to be securely transported to end-users with ultimate climate control.
Big Data has also impacted Promotion with Programmatic Media Buying. For Physical
evidence, the Big Data applications’ most evident examples are Google Optimised Land-
ing Pages and the Amazon Go store, with its ‘Just Walk Out’ technology. Through Big
Data analysis, Walmart has improved its supply chain collaboration to optimise in-store
stock in preparation for adverse weather efects. Big Data is also tracking how People, the
human assets of an organisation, are managed.
The key challenge of Big Data is the volume of data (both structured and unstructured)
available for decision-making. Hence, there is a need to develop advanced AI applications
to help interpret the generated data into actionable insights.
Chapter 3 investigates the implementation of data-driven decision-making pro-
cesses within an organisation as an essential success factor in today’s competitive envi-
ronment. Ten industry experts were interviewed to identify the potential barriers to
implementing data-driven decision-making processes across an organisation. Three
key barriers for data-driven marketing in Finnish organisations were identifed: cul-
tural barriers, structural barriers, and top management barriers. While these three
barriers hindering the implementation of data-driven marketing practice were found
to be interlinked and overlapping, based on a review of past research in this feld, this
fnding was anticipated.
Chapter 4 highlights the future potential of Programmatic (online) Advertising,
which relies on massive datasets, optimisation algorithms and intermediaries to deliver
relevant advertisements to target audiences at scale. Programmatic Advertising can be
divided into two distinct functions: Programmatic Buying that aspires to automate
the process of buying and selling ads in real time and Programmatic Creative aims to
optimise and generate personalised content in real time. With the development of
Programmatic Advertising technology, a shift from Programmatic Buying to Program-
matic Creative is to be anticipated. While research into Programmatic Advertising
has been championed by computer scientists, this chapter places the topic under the
marketing communication feld via in-depth interviews with marketing executives
working in this feld in Vietnam.
The next two chapters begin Section 2 and focus on the design and technical features
that organisations should utilise to ensure a positive online experience for their custom-
ers. Customers of today expect companies and brands to have a digital presence; thus,
company-owned websites have long been viewed as a cornerstone of DM. Chapter 5
highlights the strategic role a company website plays when communicating with custom-
ers or during the actual sales process. This elevated role is a direct continuum of today’s
consumers actively searching for information about organisations and products online.
Branded websites also contribute to customers’ overall evaluation of the company behind
the brand (Consumer Brand Experience), and positive online experiences can contribute
to online expenditures. The fndings are based on an analysis of 202 respondents.
Chapter 6 is based on a case study, thus recognising the signifcance of User Experi-
ence (UX) for the commercial success of websites. UX is about the user’s perceptions of
and responses to their interaction with a system, such as a website. UX focuses on the
Human–Computer Interaction (HCI), and a positive UX is essential for a satisfactory
Introduction 3
online customer journey on e-commerce websites. UX, in essence, focuses on humans
interacting with technology, including their perception of the aesthetic and even the
hedonic design features, afordances, functionality and responsiveness of the interaction.
This case study focuses on a consumer electronics brand with a newly redesigned website.
A Cognitive Walkthrough is followed by a User Experience Questionnaire (UEQ) to
identify design features that need improvement for the customer journey.
Chapter 7 highlights the importance of AI applications in the merging of the Voice
Commerce context. Voice Assistants (VA), such as Amazon Alexa and Google Home,
are winning a place in our homes, yet little is known about the potential ways they can
change established consumer journeys (and touchpoints). Are VAs an opportunity for
Marketers to elaborate on their Augmented Product ofering? To what extent can VAs
infuence the current balance of competition, especially for low perceived risk, repeatedly
purchased items? This chapter reports on a substantial qualitative research project with
almost 100 participants.
Section 3 starts with two chapters exploring the role that digital transaction places
hold in customers’ minds. Chapter 8 views servicescapes as a multilevel construct,
with physical, digital and social realms. This chapter analyses the servicescape concept
through the social capital prism to demonstrate that social capital plays an integral
part in the customer service experience by satisfying a social need. The social aspect
of service encounters has also been exasperated by the COVID-19 pandemic due to
restrictions in individuals’ free movement. Through digital channels (omnichannel
retailing), customers now have a wider spectrum of touchpoints available, includ-
ing customer-to-customer communication and technology-facilitated co-creation of
value, for their interactions.
Chapter 9 investigates the blending of physical and digital servicescapes as well as the
relationships consumers develop with brands or stores. This is done via a quantitative
survey of Finnish consumers in which the respondents focus their replies on one of four
well-known branded retailers. This chapter aims to establish whether the introduction
of ‘digital’ has blurred the boundaries between actors in the marketplace and how the
blending of physical and digital servicescapes afects consumers and the relationships they
develop with brands and stores.
Chapter 10 focuses on SM and how it can empower consumers. From the marketing
perspective, the emergence of SM has created signifcant changes: today’s consumers can
infuence organisations and brands, create content that is followed by peers globally and
infuence how other consumers view brands or organisations (please see also Chapter 15).
SM is also highly integrated into smartphones and can be accessed, commented on or
forwarded by consumers on the go. Chapter 10 also discusses how the volume of these
SM-empowered communications can create or destroy value for organisations.
Section 4 includes four chapters on privacy practices across diferent sections of the
DM landscape. Chapter 11 explores how consumers respond to a retailer’s ethics across
diferent distribution channels, such as brick-and-mortar stores, online shopping and
multichannel shopping; this novel research design compares consumer responses to an
identical survey across diferent channels with almost 700 respondents. Today’s retailers
are feeling pressured to ofer a multichannel retail environment to gain overall improve-
ments in customer service but are consumers who use brick-and-mortar, online and
multichannel shopping channels a homogenous group?
Chapter 12 merges the privacy drive of the GDPR to the data-rich environment of
AI. The use of AI is growing exponentially, and many organisations are benefting from
4 Outi Niininen
being able to deal with phenomenally large datasets during a time when IoT-enabled
devices can generate volumes of relevant data for decision-making (see Chapter 2).
Improvements in Cognitive Computing have made data processing more efcient and
expedient: data can be more efectively converted into value for organisations as well as
end-consumers. Yet, how do AI managers who enable data operations view the poten-
tially restrictive GDPR conditions? This chapter reports on interviews with AI experts
and managers from fve diferent countries to gain an understanding of these potentially
opposing trends (AI-enabled analysis of Big Data vs. the GDPR environment) impact
on DM practices.
Chapter 13 explains how the GDPR impacts research in the marketing feld. The
introduction of the European Union’s (EU) GDPR resulted in an avalanche of nega-
tive publicity, which focused on the potential fnes that organisations might incur if they
fail to protect the privacy of individuals. Research in marketing would not be excluded
from these. How big is the leap from existing Institutional Review Board (IRB) require-
ments to GDPR-style secure data handling? Much of the GDPR guidance for academic
research comes from medical research, which explains the need to highlight the situations
in academic marketing research and how marketing academics running research proj-
ects can ensure that their data management aligns with current regulations: with refer-
ence to specifc EU documentation, a seven-step process for GDPR-compliant academic
research is explained.
Chapter 14 is based on a large-scale survey of a pilot project wherein a major retail
chain developed an application based on a loyalty programme that allowed consumers
access to their purchase history. The chapter’s title accurately describes the variety of
responses the pilot study participants had to this information. This is an interesting study
because customer purchase history data are most commonly used by organisations to
understand the behaviour and preferences of their customers. MyData are essentially Big
Data that are made available to the end consumer – the person whose shopping behaviour
is tracked by the loyalty programme. By sharing their data with customers, the retailer is
hoping to increase trust and transparency as well as generate new opportunities for value
co-generation.
The ffth section of this book explores the future for digital marketing communication and
concludes this book. Chapter 15 touches on the key digital developments that we see
causing change in the DM and Communication landscape in the near future: AI and
automation (including Chat Bots); the role individuals as infuencers will play in brand
communications, possibly even to the extent of providing free digital labour; data surveil-
lance, deepfakes and how Blockchain technology could ofer a solution to many potential
issues identifed in marketing and business practices.
Each of these chapters resulted from a long-term study, from post-doc research to
exceptionally well-crafted Master’s thesis research. These research processes started before
the emergence of the global COVID-19 pandemic (i.e. it is not possible to make changes
to the data that were already collected). As the Editor, I would like to thank the Authors
for their eforts to include COVID-19 implications in their chapters where possible. All
chapters in this book have been through a double-blind review process to ensure high
quality and relevance to the DM feld. Special thanks go to all our colleagues, both
domestic and overseas, who gave their expertise and time to the double-blind review
process that we utilised in this book.
Introduction 5
References
Dwivedi, Y. K., Rana, N. P., Slade, E. L., Singh, N., and Kizgin, H. (2020). ‘Editorial introduction’.
Advances in Theory and Practice of Digital Marketing, 53(March). https://doi.org/10.1016/j.
jretconser.2019.101909
Herhausen, D., Miočević, D., Morgan, R. E., and Kleijnen, M. H. (2020). ‘The digital marketing capa-
bilities gap’. Industrial Marketing Management, 90, pp. 276–290. https://doi.org/10.1016/j.
indmarman.2020.07.022
Section 1
Introduction
The sheer volume of data on consumer behaviour and processes available to organisations
is unprecedented. Computers and smart devices such as smartphones, smart cars, smart
locks, smart refrigerators, smartwatches, smart speakers and other similar devices enabled
by the Internet-of-Things (IoT) are emitting unstructured and structured data that enable
organisations to generate consumer behavioural insights. These data can help in market-
ing strategy formulation while unlocking new market opportunities that were previously
underexplored or unexploited (Erevelles, Fukawa, and Swayne, 2016).
Several leading global organisations have invested in using Big Data analytics to gain a
competitive edge in the marketplace. For instance, online retail giant Amazon maintains
data on its customers’ names, addresses, payments and search histories in its data bank
and uses its algorithms to improve customer relations for a seamless real-time customer
experience across all online touchpoints (Liu et al., 2020). American Express also uses Big
Data to analyse and predict consumer behaviour. With access to Big Data, the predictive
models enabled by Machine Learning (ML) capabilities allow for the superior applica-
tion of both structured and unstructured data to better understand customer behaviour.
Through sophisticated ML predictive models, organisations are able to apply Big Data
in developing more personalised value propositions and warding of potential customer
churn (Manglani, 2017). In the Business-to-Business (B2B) market, Rolls-Royce is using
the data from IoT sensors on aircraft jet engines to provide a higher value proposition
for their business customers by introducing the concept of Power by the Hour (PBH)
or Engine-as-a-Service, meaning that value is derived via ‘access to resources’ rather
than ‘ownership of resources’ (Shcherbakova, 2020). For a fat hourly rate per engine,
Rolls Royce would handle installations, check-ups, maintenance and decommissioning.
Preventative maintenance scheduling for these engines is automated based on the data
received from the many sensors embedded in the engines. This pioneering approach to
engine maintenance management forms the basis of the company’s market leading Cor-
porateCare® service. By adopting the PBH model, airlines transfer the engine mainte-
nance responsibility to a vendor, which ensures that engine efciency and safety remain
at an optimal level. Airlines can then focus on their core competencies, which include
customer service, route optimisation, pricing and marketing.
As Big Data becomes the new normal, organisations explore ways in which Big Data
can be captured and used in marketing analytics to unleash new organisational capabili-
ties and value propositions for customers. In this chapter, we explore the application of
DOI: 10.4324/9781003093909-3
10 Stephen Singaraju and Outi Niininen
Big Data through the lens of the Marketing Mix. We extend the work by Fan, Lau, and
Zhao (2015) via the expansion of their 5Ps framework (Product, Place, Promotion, Price
and Process) with Physical evidence, Partnerships and People for contemporary market-
ing practice in both the B2B and the Business-to-Consumer (B2C) markets. We begin
by addressing the following questions that help explain Big Data and its application to
marketing practice:
• What does the term ‘Big Data’ mean, and how will the insights provided via Big
Data analytics difer from what managers might generate from traditional
analytics?
• What new insights does this new genre of marketing analytics provide for market-
ing decision-making?
These questions about Big Data are examined in the following sections of this chapter.
Product
In the product decision-making realm of the Marketing Mix, Big Data is beginning to
infuence marketing decisions in areas as diverse as new product design and development,
reputation or brand management, product lifecycle management and quality manage-
ment. For example, in the consumer electronics industry, Big Data has been applied by
major organisations, including Xiaomi and Lenovo, to accelerate the pace of NPD pro-
grams in responding to today’s dynamic and evolving marketplace (Tan and Zhan, 2017).
Big Data has allowed for product features and functions to be added to a product that
customers are willing to pay for while eliminating otherwise undesirable product features
(Sun and Huo, 2019; Urbinati et al., 2019).
In the semiconductor industry, Intel monitors product quality attributes through Big
Data interfaces, which enables the organisation to signifcantly reduce the validation time
for testing before bringing the product to market. Intel fuses intelligence derived from
Big Data with AI to signifcantly increase new product quality and reduce NPD time. In
test execution, Big Data analytics coupled with AI allows Intel to locate faults more ef-
ciently while eliminating redundant tests in their NPD programs. This approach reduces
the number of tests performed by 70%, enabling complex semiconductor products to
reach the market more quickly without compromising product quality (The Innovation
and Enterprise, 2020 – see Further reading).
Using Big Data, brand marketing campaigns are able to more accurately analyse brand
strength through a brand’s reputation in the marketplace. Making the linear approach
to collecting data redundant, the new approach to brand marketing is utilising circular
data analysis via a variety of data touch points. Marketers are able to monitor the ‘Likes’
or ‘Re-tweets’ of potential customers, which allows the data analytics system to identify
crucial metrics that set aside specifc parameter results and aid in the marketer’s under-
standing of the customer’s preference for the brand.
Understanding Big Data and its application 13
Price
A greater understanding of the buying behaviour of our customers can help organisations
fnd the optimal price that a customer is willing to pay at any given time, place or circum-
stance. Manual practices for setting prices are time-consuming and make it impossible for
marketers to visualise dynamic pricing patterns for their products and thus optimise pricing
and unlock value. Pricing decisions based on factors such as product costs, product margins,
competitor prices and quantity discounts are simplistic and inadequate in the current real-
ity of emerging marketing practices. At its core, a pricing decision is essentially a Big Data
issue (Feng, Li and Zhang 2019; Gerlick and Liozu, 2020; Steinberg, 2020).
Hence, marketers are increasingly bringing themselves to adopt dynamic pricing
approaches, a market-driven demand-based approach to pricing that engages a fexible
pricing practice in which the actual price for a product is based on a complex analysis of
current market conditions. Demand, seasonality and competitor actions are among the
factors that moderate the actual price level of a product at any given time ( Jiang and Li,
2020; Augustin and Liaw, 2020). In the United States, the practice of dynamic pricing
among major league baseball teams demonstrates the robustness and the efectiveness of
Big Data-driven dynamic pricing models that improve revenue management. Prices are
set at multiple times of day, incorporating many Big Data variables, including weather,
ongoing work around the ballpark that may be a cause of inconvenience for patrons,
teams on the rise in the league, the potential for a record-setting event (hits, homeruns
or plays), trending conversations about a game on SM, and what tickets are selling for in
secondary marketplaces, such as StubHub and TicketMaster, the largest fan-to-fan ticket
marketplaces (see Erevelles, Fukawa, and Swayne, 2016). Hence, Big Data allows organ-
isations to manage their pricing to capture the willingness of fans to pay more for a special
game while mitigating the tendency for parallel-market opportunistic organisations or
individuals to exploit pricing discrimination practices that may otherwise exist and thus
distort an organisation’s pricing strategies.
Place
The ‘place’ or ‘distribution’ aspect of the Marketing Mix typically involves logistical con-
siderations such as warehouse management, inventory management, packaging and order
tracking. The ubiquitous use of Location-Based Services (LBSs) enabled by mobile tech-
nology provides marketers with location- and time-specifc user information for its target
markets. The location-based information of target customers is seen as having fundamen-
tal ramifcations for the four leading logistics considerations, that is, inbound transport,
outbound transport, inventory management and warehousing activities (Onstein et al.,
2020; Ashayeri and Rongen, 1997; Christopher, 2011). Innovations associated with the
application of location-based information systems to enable the matching of supply and
demand in marketplaces have been shown to signifcantly reduce the costs associated
with the aforementioned logistical consideration that is fundamental for the movement
of goods from production and warehousing facilities to the target market for consump-
tion (Christopher, 2011). A demand-driven supply chain’s ability to respond rapidly to
demand variability based on the movement of its target market, which is aligned with
supply, is even more pronounced in services-based industries (Onstein et al., 2020).
Balancing the supply and demand sides of a service industry is a critical success factor
because this industry provides products that are more intangible, perishable, inseparable
14 Stephen Singaraju and Outi Niininen
and variable than physical goods. In this sense, the application of real-time location-based
Big Data will result in lower working capital requirements and drive stronger sales and
proft. For example, functions such as barcode reading, videos, pictures and messages are
inherent capabilities of most smartphones today and optimise supply chain operations
at very little cost. Location data captured by mobile phones makes it easy to track ship-
ments with precision using devices’ location capabilities linked to the central corporate
system over the Internet. Drivers can map shorter or less congested routes to make timely
delivery and this, in turn, signifcantly optimises feet utilisation (asset utilisation) in the
courier services such as UPS and Federal Express.
The recent outbreak of the COVID-19 global health pandemic has brought to promi-
nence the role of Big Data in tracing the movement of people to help contain the speared
of infections amongst the population in a country, state, city or smaller geographic
boundaries. Big Data has been pivotal in revealing the patterns and provide insights into
the spread and control of this virus based on the movement of members of the society.
Several modalities of digital data including patient location, proximity, patient-reported
travel, co-morbidity, patient physiology and current symptoms made possible by the loca-
tion capabilities inherent to smartphones can be digitised and used for generating action-
able insights at both community and demography levels (Haleem et al., 2020), resulting
in the more efcient allocation of critical resources for better utilisation of public health
services.
The use of location-based Big Data is not merely limited to the movement of humans
but is also increasingly pertinent to the monitoring of the movement of ‘things’ in the
age of the IoT. Modern vehicles are already equipped with a multitude of sensors and
on-board computers that alert drivers to the imminent need for servicing. Hence, after-
sales maintenance and the spare parts market for motor vehicles are probably the area
where sensor based, product-in-use data can already produce the greatest strategic gains
for organisations. Considering the fact that the same brand of vehicles can utilise difer-
ing design principles, it is no wonder that the vehicle after-sales maintenance and spare
part manufacturers are struggling with the ‘bullwhip’5 efect. For example, variance in the
demand for spare parts by vehicle end-users due to, for example, unanticipated changes
in the conditions where the vehicles are used (e.g. long-term drought and dust caus-
ing problems with the engine) creates signifcant fuctuations in demand for spare parts
manufacturers and vehicle servicing operators. These bullwhip efects could be reduced
if on-board computers signalled a vehicle after-sales support network of these changed
(long-term) location specifc weather conditions and the impact they are having on spe-
cifc engine parts. Moreover, a quick reaction (i.e. preventative maintenance) to engine
sensor warnings could also result in localised repairs to stop the damage altogether, which
is an example of superior customer service (Andersson and Jonsson, 2018; Giannakis and
Louis, 2016).
However, the challenge that persists for location-based Big Data analytics is its cur-
rency in accurately predicting customers’ locations. Both spatial and temporal data should
be taken into consideration (temporal moving pattern mining for LBS) (Fan, Lau, and
Zhao, 2015). A large volume of spatial and temporal data will need to be processed within
a very short time period, practically in a matter of seconds, before customers move to
new locations. Given the context-specifc importance of location-based Big Data, this
information will only be rendered valuable if the currency of the data can be guaranteed
to enable context-relevant marketing decision-making. Thus, the ‘velocity’ issue regard-
ing Big Data remains one of the most challenging aspects of location-based Big Data.
Understanding Big Data and its application 15
Promotion
As marketing information systems interface and integrate with consumer technologies
such as SM Platforms, it is fair to argue that Promotion is the Marketing Mix element
most impacted by the advent of Big Data and its application to marketing practice. The
advent of Programmatic Marketing for targeted, real-time online display advertising can
only be explained by the harnessing of Big Data in an information infrastructure which
supports real-time processing frameworks that enable media buying on the ‘fy’ based on
user web sessions and preferences ( Jabbar, Akhtar, and Dani, 2019). Such integration
provides solutions based on the analysis of information about consumers’ preferences,
opinions and needs. In other words, the scope of Big Data acquisition for marketing
communications application permeates a wide range of marketing communication mix
decision-making.
Big Data has become so fundamental to basic marketing communication decisions that
it is beginning to infuence programmatic media buying, granular audience segmenta-
tion and targeting and the execution of real-time trigger marketing campaigns (Chen
et al., 2019; Ford, 2019; Jabbar, Akhtar, and Dani, 2019). For example, marketers have
increased consumers’ awareness of their brands via the application of Big Data in recom-
mender systems in the e-commerce context. Product marketing via online platforms such
as Amazon and Ebay has targeted audiences using Online Consumer Reviews, where the
sentiment mining of Big Data is applied for the efcient placement of digital advertise-
ments in the e-commerce marketplace (Salehan and Kim, 2016; Chong et al., 2017).
Unfortunately, not all online reviews are accurate or truthful because some reviews are
deliberately designed to either increase the popularity of a brand or discredit a competi-
tor’s brand – these fake reviews can distort a brand’s reputation (Reyes-Menendez, Saura,
and Martinez-Navalon, 2019). Sentiment analysis, a subfeld of Natural Language Pro-
cessing (NLP), can help automate the detection of fake reviews. By analysing the posi-
tive–neutral–negative meanings of the text and identifying content similarities between
reviews, this review spam can be removed. Many e-commerce systems also link reviews
to past purchases to identify fake reviews. Online sales and promotional platforms are
dynamically managing their fake review detection systems in addressing the data distor-
tions contributed by review spam (Chong et al., 2017; Nair, Shetty, and Shetty, 2017).
Television ads can now be targeted at the household level via Programmatic Advertis-
ing as TV stations migrate their broadcast technologies from analogue to Internet-based
technologies (Lee and Cho, 2020). This has resulted in real-time, automatic bidding
for advertising opportunities online, accounting for two-thirds of the total digital video
spend in the United States in 2019 (Malthouse, Maslowska, and Franks, 2018). However,
due to the limitations of the current technologies used in Big Data analysis, the challenges
posed by the very nature of Big Data (i.e. volume, variety, velocity and veracity) call
for a dynamic and more scalable, multi-tiered, automated system for Big Data-enabled
decision-making systems (Kumar, Shankar, and Alijohani, 2019).
Process
The most signifcant impact of Big Data is the automation of marketing processes. Real-
time Big Data analytics involves the processing of a continuous stream of data inputs from
a variety of sources for instantaneous marketing decision-making with low information
latency (Kitchens et al., 2018). The drive to automate marketing processes will mean that
16 Stephen Singaraju and Outi Niininen
typical marketing activities, including but not limited to website buying, ad-slot buying,
online publishing, customer profling, targeting, search engine optimisation and content
generation, will experience signifcant disruption ( Jabbar, Akhtar, and Dani, 2019). The
confuence of real-time processing within programmatic marketing calls for marketers to
re-examine their existing marketing processes and invest in cloud-based infrastructure for
scalable, real-time marketing analytics and automated decision-making (Hazen et al., 2014).
Recently, Programmatic Marketing for online display advertising has become an exam-
ple of a marketing communication process that has been increasingly automated via the
acquisition and use of real-time Big Data. Although in its infancy, Programmatic Market-
ing is likely to accelerate and refne the automation, algorithmic decision-making and
developments in advertising technologies, leaving behind traditional media approaches
that in comparison, are unproftable and less efcient ( Jabbar, Akhtar, and Dani, 2019;
McGuigan, 2019). In customer service processes, the introduction of Chatbots and
virtual assistants powered by NLP and AI can answer routine customer enquiries and
release human employees for more complex tasks (Kietzmann, Paschen, and Treen, 2018;
Reshmi and Balakrishnan, 2018; Urbinati et al., 2019).
In an industrial setting, embedding sensors into manufacturing plants can help alert
managers of possible manufacturing problems and service requirements. Furthermore,
embedding sensors into machinery sold to monitor product performance can be ofered
as an additional service to the end-user to prevent expensive breakages and production
downtime. Such predictive maintenance can form a cornerstone of loyal clientele dur-
ing the crucial period after the end of warranty periods (Andersson and Jonsson, 2018;
Urbinati et al., 2019).
Physical evidence
In website design, the Physical evidence (everything the customers see when interacting
with a business online including the virtual elements of the product or service and the
layout or interior design of the virtual shops) incorporates the entire brand’s visual rep-
resentation online as well as the use of, for example, colours, images and fonts to refect
the brand values. Google Analytics can help web masters improve their website’s Physical
evidence by identifying bounce and conversion rates and overall engagement with the
website content. Data from A/B testing (Google Optimize) can be used to refne the
brand style in advertisements and Landing Pages (Kietzmann, Paschen, and Treen, 2018).
The introduction of the Amazon Go store in Seattle in 2018 provides an illustrative
insight into the potential for Big Data in disrupting the retail industry. Amazon Go is a
new prototype of a futuristic retail store based on the ‘Just Walk Out’ technology. With
only a smartphone app linked to a credit card, a customer could enter the store, select
merchandise from the aisles and just walk out – no lines, no waiting and no cashier. The
entire customer shopping experience is facilitated by the stream of real-time Big Data
enabled by technologies such as computer vision, data science, ML and sensor-based
information technologies (Ives, Cossick, and Adams, 2019).
Partnerships
Partnerships, in a marketing context, typically explore the synergies that can be achieved
by supply chain partners; for example, the efective and efcient use of Big Data can
minimise the bullwhip efect in supply chains (Hofmann, 2017). A success story of a
Understanding Big Data and its application 17
frm that has harnessed the power of Big Data analytics into their supply chain partner-
ship arrangements is Walmart (Sanders, 2016). Using batch processing Big Data analytics,
Walmart has learned a great deal about customer preferences. For example, they learned
that before a hurricane, consumers stock up on food items that do not require cooking or
refrigeration. By collaborating with their supplier partners, Walmart is able to stock such
items at their stores in advance of a hurricane. Such Big Data analytics enables Walmart
to win pricing and distribution concessions from its suppliers, and this, in turn, gives the
retailer and its partners a signifcant advantage over competing supply chain networks
(Sanders, 2016; Anshari et al., 2019).
People
Big Data analytics enables large-scale dataset integration, supporting people management
decisions for the efective deployment of human talent in marketing operations. Talent
analytics is now emerging as a methodology that allows for the identifcation of patterns
in workforce activity data, allowing more efcient workforce management (Marler and
Boudreau, 2017). The benefts derived from talent analytics in terms of value creation are
clear, in particular (1) identifying a causal relationship between training expenditure and
proftability and (2) justifying the need for an organisation to set up training in specifc
areas of human talent development that can improve organisational proftability (Nocker
and Sena, 2019).
However, the human talent for data-driven marketing operations is dynamic, and new
marketing careers, such as data scientists and data analysts, are likely to become common.
Given the dynamism of Big Data and its emerging importance in marketing practice,
Data Scientists will play an integral role in helping perform the greater statistical, query-
ing, scripting, scraping, cleaning, warehousing and training activities needed in the data-
heavy functions of marketing.
Further reading
GDPR. (2018). General Data Protection Regulation. Available at: https://gdpr-info.eu/ (accessed 5 Octo-
ber 2020).
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Laney D. 2001. 3D Data Management: Controlling Data Volume, Velocity, and Variety. Stamford, CT: META
Group. Available at: http://blogs.gartner.com/doug-laney/fles/2012/01/ad949-3D-Data-Management-
Controlling-Data-Volume-Velocity-and-Variety.pdf (accessed 7 April 2020).
Manglani, C. (2017, April 2). American Express: Using Data Analytics to Redefne Traditional Banking. Avail-
able at: https://digital.hbs.edu/platform-digit/submission/american-express-using-data-analytics-to-
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Notes
1 Unstructured data is either machine generated or human generated. For example, data emitted from
IOT devices, social media applications, website metrics and search engines are classifed as unstruc-
tured data.
2 Batch processing involves the processing of large volumes of data which has been collected over a
signifcant period of time. It is a popular method for processing Big Data typically used in applications
where data naturally ft in a specifc time window (Casado and Younas, 2014).
3 Real-time processing is defned as an approach that requires a continuous stream of inputs for the
processing and outputs of data (Casado and Younas, 2014).
4 The term ‘marketing mix’ is a foundation model for businesses, historically centered around product,
price, place and promotion and had been extended to include people, physical evidence, partner-
ships and processes to cater for services marketing. The marketing mix has been defned as the ‘set of
marketing tools that the frm uses to pursue its marketing objectives in the target market’.
5 The bullwhip efect refers to distorted information from one end of a supply chain afecting another,
leading to tremendous inefciencies in the form of excessive inventory investment, poor customer
service, lost revenues, misguided capacity plans, inefective transportation and missed production
schedules (Lee, Padmanabhan, and Whang, 1997).
Understanding Big Data and its application 19
6 The General Data Protection Regulation (GDPR) is a regulation in EU law on data protection and
privacy in the European Union (EU) and the European Economic Area (EEA). It also addresses
the transfer of personal data outside the EU and EEA. The GDPR’s primary aim is to give control
to individuals over their personal data and to simplify the regulatory environment for international
business by unifying the regulation within the EU. GDPR. (2018). General Data Protection Regulation.
Available at: https://gdpr-info.eu/ (accessed 5 October 2020).
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3 Data-driven marketing processes
Boundaries and how to overcome them
Heidi Länsipuro and Heikki Karjaluoto
Introduction
The enormous sets of data that are currently accessible for organisational use can both over-
whelm and ofer new opportunities to today’s marketing professionals. Ever-developing
web and technological advancements present marketers with better approaches to mea-
suring, optimising and automating marketing processes; as a result, marketers are increas-
ingly placing analytics and data analysis at the centre of organisations’ marketing functions
(Day and Moorman, 2016). Despite various advancements in data interfaces and services,
drawing conclusions that could prompt feasible action are not yet used comprehensively
to infuence decision-making. Additionally, marketers are facing an expanding demand
from top management to quantify the marketing professionals’ performance ( Järvinen,
2016). The level to which organisations collect data is high; however, strategic and practi-
cal data usage remains incredibly low (Chafey and Patron, 2012).
Previous studies have focused on numerous themes that either overlap or surround
data-driven marketing and marketing analytics practices (Chafey and Patron, 2012;
Hauser, 2007; Järvinen and Karjaluoto, 2015; Jobs, Aukers, and Gilfoil, 2015; Liu, Singh,
and Srinivasan, 2016; Martens et al., 2016; Netzer et al., 2012; Verhoef, Kooge, and Walk,
2016; Viktor, Pena, and Paquet, 2012; Wedel and Kannan, 2016; Wilson, 2010). Studies
have highlighted both the fundamental shortage of marketing data professionals and the
lack of knowledge regarding how much companies are currently using data-driven deci-
sions in marketing (Erevelles, Fukawa, and Swayne, 2016). These studies describe a need
for knowledge of efective marketing analytics capabilities (Day and Moorman, 2016).
Day and Moorman (2016) state the need for gaining practical knowledge by studying
the factors that infuence marketing measurement adoption and the process needed for
the successful implementation of marketing analytics. Thus, both practice and scholarly
research call for further investigation into barriers to the systematic usage of data-driven
marketing, which is what this study aims to explore.
Against this backdrop, this study aims to advance the knowledge of barriers that hinder
the implementation of data-driven marketing practices in organisations via a qualitative
approach. The data and methodology that are used in this research include 10 marketing
professionals’ interviews as well as a thorough literature review to describe the study’s theo-
retical framework and positioning. To gather insight into the research problem, the barri-
ers mentioned by the interviewees were categorised through a qualitative analysis that was
based on a framework from a previous literature review (e.g. Day and Moorman, 2016).
This section presents the background for this study, followed by the theoretical frame-
work for categorisation of the barriers. The data selection, methodology and justifcation
DOI: 10.4324/9781003093909-4
Data-driven marketing processes 23
for using a qualitative approach are detailed in the following section. This is followed by
the results of the study. Finally, the fndings and limitations of this study are discussed.
Additionally, recommendations for future research are presented.
•
Organisational Organisational Top management
structure culture • involved
• information • adaptability strategically
barriers to change • supportive
Figure 3.1 The framework of ‘Barriers of data-driven marketing’ based on past research.
Source: Based on Day and Moorman (2016, pp. 6–35).
data-driven marketing predominantly requires some form of change (Levin and Gottlieb,
2009), and previous research has come to the unanimous conclusion that resistance to
organisational change is signifcantly high (Rosenberg and Mosca, 2011). Mezias et al.
(2001) argue that communities’ past thinking is integrated into not only rules, routines
and programmes but even human capital. Consequently, the mentioned cultural barriers
of data-driven marketing are highly linked to management. Thus, this research investi-
gates top management as one of the main barriers to successful data-driven processes (see
Figure 3.1).
Organisational change, learning and adaptivity require a fuid organisational structure
(Banerjee and Srivastava, 2017). Thus, another important barrier regarding culture is the
structure of an organisation. Chafey and Patron (2012) list company culture, conficts of
interest between departments and a siloed organisation as barriers to the integration of
web analytics. Per Banerjee and Srivastava (2017), culture is fundamental in forming the
structure of an organisation. Furthermore, organisational structure and culture are unpre-
dictably related to how advancement and innovation are managed or executed in any
association (Banerjee and Srivastava, 2017). Thus, organisational culture, organisational
structure, top management characteristics and the factors within them that may present
barriers to data-driven marketing deployment are visualised in Figure 3.1. Expert inter-
views are used to analyse the barriers to data-driven marketing deployment.
Methodologies
The study’s data collection method was interviews, which is best suited for situations
where the study is concentrating on the discovery of, for example, experiences, interpre-
tations, attitudes and values that cannot be portrayed in a more systematic way (Carson,
Gilmore, and Perry, 2001; Hirsjärvi, Remes, and Sajavaara, 2009). Semi-structured with
mainly ‘how’ and ‘what’ questions were utilised to allow for more in-depth data (Koski-
nen, Alasuutari and Peltonen 2005).
Multiple steps were taken to ensure the strategic yet subjective selection of interview
participants. This study utilised theoretical sampling, which is defned as the purposive
Data-driven marketing processes 25
Table 3.1 Interview information
selection of interviewees based on their relevance and the potential they ofer for estab-
lishing new concepts by considering their characteristics and dimensions (Corbin and
Strauss, 2008). During this research process, ten interviews were conducted. To ensure
both a valid theoretical sampling basis and broad representation, specifc criteria were
established for the interviewees, including being a representative of a company that oper-
ates in the Finnish region and holding a position that enables them to execute marketing
actions based on possible data analysis and insights. The fnal criteria sought to ensure
that the interviewed experts would represent a wide variety of company sizes, company
lifecycles and industries, adding diversity and depth to the data (see Table 3.1). All of the
interviews were conducted in Finland.
The current research utilised interpretive techniques, such as thematisation, coding and
in-depth analysis, to provide a solid theoretical basis despite its subjectivity. Nonetheless,
this qualitative research attempts to provide a basis for data-driven marketing processes
research through a more in-depth look into the topic instead of presenting generalis-
able results. Such conclusions might be unattainable for executing quantitative methods
(Petrescu and Lauer, 2017). Carson, Gilmore, and Perry (2001) argue that a qualitative
research method is applicable in circumstances where the research aims to develop a more
in-depth understanding of a subject that has not previously been comprehensively studied.
Hence, the philosophical approach of this research justifes the subjectivity of its means.
Cultural barriers
Banerjee and Srivastava (2017) describe organisational culture as the shared values that
establish a common ground and direction for the entire organisation. Schein (1992)
defnes organisational culture as a set of common hierarchical convictions and quali-
ties that infuence the organisation. Refecting on these perspectives, the interviewees
described multiple reasons for barriers relating to organisational culture. Seventy percent
of the interviewees discussed the importance of a shared mindset as an enabler of data-
driven decision-making in marketing. The interviewees explained that without com-
monly shared ideas and ambitions, moving forward with a few people or teams would
likely involve setbacks and hindrances caused by clashing ideologies.
Challenges linked to change management, whether related to people, structure or
processes, were common amongst the interviewees. This aligns with previous research
(Branda, Lala, Gopalakrishna, 2018; Chafey and Patron, 2012; Davenport and Harris,
2007; Germann, Lilien, and Rangaswamy, 2013; Gonzalez and Melo, 2017; Wedel and
Kannan, 2016) that states that such obstacles have surpassed the complications faced by,
for example, data implementation. Moreover, more than half the interviewees mentioned
the demand for a common language as well as connected virtual environments that enable
data sharing without boundaries, both of which are closely linked to organisational cul-
ture. Similarly, some interviewees raised concerns regarding silos, where, despite a com-
mon language, the disruption in data distribution caused diferent decision-makers to
have diferent views on the same case or process. Even in cases where the data available
were not being utilised productively, issues were found that traced back to an organ-
isational culture where data-driven decision-making was not made a shared goal and
priority.
As Germann, Lilien, and Rangaswamy (2013) argue, marketing analytics insights are
sufciently shared through a positive analytics culture, and the interviewees disclosed
similar ideas. Some interviewees even mentioned actively working towards a data-driven
culture across the organisation by sharing data proactively outside the marketing depart-
ment. A strongly analytical and data-driven culture is focused on picking up information
and consistent data sharing (Mezias et al., 2001). Furthermore, almost half the interview-
ees wanted to develop a setting where individuals would be encouraged to attempt vari-
ous things with lean ideology from an experimentation perspective to ensure the option
to cultivate showcasing information-driven improvement, which was also described by
Mezias et Al. (2001).
Nevertheless, opposition towards analytics usage in the data-driven marketing devel-
opment process is an apparent barrier that is caused by conficts between diverse organ-
isational cultural ideologies. Whether it is resistance to adaption to changes, conficting
ideologies within the organisation or the lack of common ground and paths, all the inter-
viewees cite organisational culture as one of the main barriers to advancing data-driven
marketing processes, which verifed the division displayed in Figure 3.1. Continuously
encouraging individuals in the organisation to learn, advance and work across silos was
seen to have a positive impact on data-driven process development by enabling shifts in
the organisational culture. Most of the interviewees gave examples of situations where
education and organisation-wide involvement had a constructive outcome for marketing
Data-driven marketing processes 27
analytics utilisation. Wedel and Kannan (2016) highlight commonly accepted beliefs in
the organisation as a central driver for data-driven marketing. Moreover, organisations
that do not invest in the education of analytics experts face more difculties in evolving
their capabilities than those who do invest in it (Wedel and Kannan, 2016). Thus, barri-
ers can and have been overcome in past cases through education and by examining silos
from a cultural perspective.
Structural barriers
To gain consistency, enable learning and achieve acceptance towards change, the organ-
isational structure needs to be fuid (Banerjee and Srivastava, 2017). Over half the inter-
viewees named difculties with data sharing as a recurring issue in the organisation. Part
of these problems were related to the organisational culture to a greater extent, but a few
of the interviewees cited the cause as a structural barrier. Moreover, half the interviewees
emphasised the importance of common goals to prevent structure-related barriers.
Half the interviewed experts saw some cultural reluctance to changing the mindset of
the personnel as a result of organisational silos. In addition, silos within the organisation
were seen to infuence the generation of diferent levels of expertise between functions.
This is consistent with past research that lists organisational silos as barriers to develop-
ment (Chafey and Patron, 2012). Furthermore, organisational structure issues were seen
to be more severe in larger organisations.
In total, eighty percent of the interviewees considered data linkage and the integra-
tion of datasets into a common database an issue created by an infexible organisational
structure. One-sided data were seen to afect reliability because the answers would not
exhaustively describe the entire picture and provide certainty. A few interviewees saw
steep hierarchies and uninvolved top management as barriers to data-driven marketing.
They claimed that if senior management is structurally ‘too high up’, their involvement in
these vital development processes will become difcult, as steep hierarchies often hinder
the fow of information.
Managerial barriers
The top management-related barriers that were discovered in this research were manifold.
The organisational management approach naturally infuences all aspects of the business,
including the culture of the organisation and its structure (Banerjee and Srivastava, 2017;
Groysberg et al., 2018). Furthermore, due to management’s strong infuence, their actions
shape the culture and operating methods of the organisation in a lasting way (Groysberg
et al., 2018). Most of the interviewees were convinced that top management support is
crucial for the successful implementation of data-driven processes. Davenport and Harris
(2007) cite collateral ideas, arguing that a data-driven strategy requires top management
support. Other studies also share this view (Branda, Lala, and Gopalakrishna, 2018; Kiron
et al., 2011). Furthermore, Kumar et al. (2016) state that data, technologies and analytics
experts need managerial staf members to recognise the benefts of data-driven market-
ing to enhance data-driven processes and help them thrive across the organisation. The
perspective of top management was of considerable importance to more than two-thirds
of the interviewees. Moreover, a few of the interviewees highlighted the importance of
coherent guidelines and objectives. The interviews revealed problems in communicating
the objectives and possible contradictions between management and marketing goals.
28 Heidi Länsipuro and Heikki Karjaluoto
The interviewees felt that the involvement of top management in the strategic devel-
opment, shaping and monitoring of marketing is an important part of the success of
data-driven processes. For example, 70% argued that if management is not involved with
marketing or its related data, then marketing has neither the power nor the complete
insight to drive change sustainably and proftably. Thus, a lack of data-driven thinking in
the organisation’s top management might cause a barrier to implementing data-driven
processes.
Discussion
The study fndings provide both practical and theoretical contributions. The fndings
imply that, despite individual motivations towards a more data-driven marketing process,
at least a partial organisational culture shift is needed to generate advancements in data-
driven marketing and decision-making in the long term (see Figure 3.1). Thus, multiple
functions within an organisation must recognise the benefts of marketing analytics and
strive towards analytical thinking methods to achieve progress. If this is not the case,
developing data-driven marketing will not last because the urgency that is seen as more
important in the daily life of an organisation quickly displaces marketing resources else-
where. Additionally, organisational silos and individual employees often return to routine
habits because alternatives seem too risky. If benefts of data-driven marketing and deci-
sion-making can be concretely recognised within the organisation, resources spent on
developing marketing analytics are no longer seen as a negative input–output ratio. A rea-
sonable beginning stage is to audit how applying marketing analytics adds to a business’s
competitive advantage, followed by contrasting this with the current capacities and worth
created. According to the fndings of this study, positive outcomes from these processes
enable further investments in data-driven marketing, which enable a cycle of repetency.
In accordance with the fndings of this study, whilst data-driven marketing processes
require organisational change, the process requires consistency and repetency in the short
term to evolve beyond the initial challenges of data-driven marketing. Data-based mar-
keting does not mean measuring everything, especially in the early stages. It is difcult
to move from minimal or nonexistent data utilisation to the collection of data for each
Data-driven marketing processes 29
singular marketing process without causing data fatigue. Creating a shared foundation
and expectation for data utilisation throughout the organisation is the initial step towards
sustainable data-driven marketing processes.
The interview data suggests that building an advanced marketing strategy in the digital
sphere that expands the commitment to data for organisations requires cautious thought
regarding the goals of the marketing department. Objectives in the organisation need to
be exhaustingly conceptualised, defned in collaboration with managers and should pref-
erably include other functions besides marketing. Furthermore, these objectives must be
clearly communicated to the entire organisation to clarify the role of marketing amongst
other functions. This will help the development of a common culture and language
in terms of data-driven marketing, which will help eliminate silos in the organisation.
The organisational top management involvement in the data-driven marketing process is
crucial and allows the marketing department to sufciently report on the results of data-
driven marketing processes. Thus, the benefts and the goals of the data-driven marketing
process must be commonly understood and valued. Furthermore, the free fow of data
that is enabled by a positive combination of sharing organisational culture and a structure
that enables such is needed.
The fndings of this study support fndings from previous research, which cite organ-
isational culture as the main driver of data-driven marketing change in organisations.
However, organisations are complex entities where multiple actions and functions afect
one another. Thus, even though organisational culture emerged as the most important
and powerful barrier to data-driven marketing, considering the roles of organisational
structure and top management are central when identifying barriers for data-driven mar-
keting processes.
Disclaimer
The research presented in this chapter was collected for my thesis, Heidi Länsipuro, the
University of Jyväskylä Master’s thesis Capability Maturity Model for Data-driven Marketing
(2020). The copyright for this JYU thesis belongs to me as the Author. Research pre-
sented here has not been otherwise previously published.
Further reading
Forbes. (2015). Data-Driven and Customer-Centric. Available at: www.forbes.com/forbesinsights/data-
driven_and_customer-centric/index.html (accessed 10 January 2020).
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4 The planning and implementation
process of Programmatic
Advertising campaigns in
emerging markets
Thanh Tiet and Heikki Karjaluoto
Introduction
Boston Consulting Group (2018 – see Further reading) projects that Programmatic
Buying ad spend will account for 63% of global display advertising spend by 2020,
leaving a 37% ad spend share for direct buying (i.e. when advertisers and/or agencies
manually choose individual ad placements and book them directly with publishers).
The rapid advancement of Programmatic Advertising has gained the attention of both
the advertising industry and the academic community and spurred many research
papers on the topic. Several popular research areas under this topic include Real-Time
Bidding (RTB) optimisation algorithms, RTB advertising revenue maximisation for
publishers and the impact of Programmatic Advertising on consumer data privacy.
The articles related to RTB date to 2014 or earlier, while the other topics were not
researched until 2017.
Despite the rich literature on Programmatic Advertising, there is a disciplinary gap
between the advertising industry and academic research due to the technical nature of
the subject (Li, 2017; Yang et al., 2017). The feld has been led by technology companies
and computer scientists rather than advertising academia (Yang et al., 2017). This explains
why most related articles were published in computer science journals or software engi-
neering proceedings, which caused a ‘research gap in the social science of the subject’
(Li, 2017, p. 4). Qin and Jiang (2019) complement this view by arguing that existing
studies overemphasise the technologies of Programmatic Advertising itself and lack dis-
cussion on how these technologies afect and transform traditional advertising processes
and practices.
DOI: 10.4324/9781003093909-5
Programmatic Advertising in Vietnam 33
Objective of this chapter
Based on the identifed research gap regarding Programmatic Advertising and increased
interest in digital advertising practices in emerging markets, namely Vietnam, this chapter
will explore how Programmatic Advertising is planned and implemented in this market.
The main Research Question this chapter seeks to answer is to what extent Programmatic
Advertising is leveraged in online advertising campaigns in Vietnam? In addition, we
look at the advantages/disadvantages of leveraging Programmatic Advertising. Our sub-
research question is how Programmatic Advertising campaigns are planned and imple-
mented. Programmatic Advertising involves automation and the integration of diferent
technologies, which may require a diferent advertising process to ensure efectiveness.
This study makes two main contributions to the research and the practice of online
advertising. In terms of theoretical contributions, it flls the disciplinary gap because
it studies the Programmatic Advertising phenomenon from the perspective of market-
ing communications. The study also presents the fndings from the perspective of an
emerging market (Vietnam), which is currently missing in academic research. In terms
of managerial contributions, the study discovers two distinctive planning and implemen-
tation processes of Programmatic Advertising campaigns, depending on the campaign’s
objectives. It also pinpoints both good and bad practices in Programmatic Advertising
processes. These fndings will help advertisers efectively and efciently manage their
programmatic ad campaigns.
Theoretical background
Methodology
This study uses case study research and abductive reasoning to answer the research ques-
tions (RQs). A case study is also suitable for answering ‘how’ and ‘why’ questions, especially
when investigating contemporary phenomena that cannot be replicated in a lab environ-
ment (Yin, 2009, p. 18). Johnston, Leach, and Liu (1999) also argue for the strength of the
case study approach to gather an in-depth understanding of the phenomenon of interest.
Data collection
Data analysis
The study used thematic analysis due to its advantage of fexibility compared to other
methods as well as its alignment with the abductive reasoning approach of the study.
Braun and Clarke (2006) explain that thematic analysis includes six phases: (1) familia-
risation with data; (2) generating initial codes; (3) searching for themes; (4) reviewing
themes to ensure that they are meaningful, signifcant and not overlapping; (5) defn-
ing and naming themes and (6) producing a report. This study’s data analysis process
followed all six phases of thematic analysis. Initial codes were identifed during the
transcription process, while the others were generated after all transcriptions were com-
pleted. The coding process also involved the data reduction step to focus on the relevant
data and make analysis feasible (Hair et al., 2016, p. 303). Based on the codes, the main
themes were identifed, reviewed and defned. The coding process was also guided by
the relevant literature. The codes were mapped and grouped into diferent themes to
help answer the RQs. Finally, each theme was identifed, and it was determined whether
there were adequate supporting empirical data and whether the theme presented a criti-
cal contribution to the RQs.
Programmatic Advertising in Vietnam 37
Results and discussion
RQ1: How is Programmatic Advertising being used in online advertising campaigns in
emerging markets?
Overall, programmatic ads are used in both long-term brand-building campaigns and
short-term direct-response campaigns, even though the data suggest that Programmatic
Advertising is being used more in long-term brand-building campaigns than it is in short-
term direct-response campaigns. Diferent campaign objectives have distinctive efective-
ness metrics. The efectiveness metrics of long-term brand-building campaigns are reach
and frequency, while those of short-term direct-response campaigns are conversions. Dif-
ferent short-term direct-response campaigns would defne conversions, such as website
visits, form registrations or purchases, diferently.
Programmatic Advertising ofers several exclusive advantages, such as sophisticated and
granular audience segmentation. This advantage stems from combining underlying pro-
grammatic technologies with holistic audience online profles. Sophisticated audience
segmentation implies that advertisers can segment the desired target audience into dif-
ferent subgroups and serve the relevant ad to each group. However, granular audience
segmentation suggests that advertisers can layer various audience attributes to narrow
the audience group and achieve precision targeting. Examples of audience attributes are
demographics, location, interest, online behaviour, etc. The spectrum goes from broad
demographic traits to specifc online behaviours. Another advantage is lookalike audi-
ence targeting. When this option is employed in an online campaign, the DSP will auto-
matically fnd a new audience with online profles similar to those of the brand’s existing
target audience. This targeting technique not only extends the campaign’s reach but also
increases conversions for short-term direct-response campaigns. The fnal advantage is
that Programmatic Buying can consolidate the performance of diferent channels and
devices as well as report the Key Performance Indicators (KPIs) at the campaign level.
This consolidation not only improves advertising efciency (i.e. reduces the ad impres-
sion duplication across channels and devices) but also lets advertisers evaluate the cam-
paign holistically (i.e. advertisers can evaluate advertising efectiveness at the campaign
level instead of at the channel level).
Despite the obvious advantages, there are three challenges with Programmatic Adver-
tising. The frst is incurring additional fees, such as platform and data fees. Advertis-
ers will be charged a platform fee when they implement programmatic ads via DSPs.
Similarly, advertisers will be charged a data fee when they leverage the audience data in
their targeting. The more the data layers involved, the higher the data fees. There were
controversial opinions among the respondents regarding whether the incurred fees are
reasonable (at least 10%–15% of the media budget). The next issue is that many advertis-
ers do not understand the audience buying concept of Programmatic Advertising. Hence,
they expect to see their own ads during the campaign period, and when they do not,
they tend to conclude that Programmatic Advertising is inefective. The third issue is
related to ad inventories. The banner ad inventories that are available for Programmatic
Buying are subject to limited sizes and formats (i.e. most programmatic banner ads are
of Internactive Advertising Bureau (IAB) standard sizes); therefore, if a brand wants to
convey its message through a rich format banner (e.g. an expandable non-IAB standard),
there is a high chance that the brand can only deliver that message via direct buy. The
next obstacle is that many local publishers who own premium ad inventories (i.e. ad
38 Thanh Tiet and Heikki Karjaluoto
placements with high reach and high viewability) are reluctant to sell these ad impressions
through programmatic channels. Instead, they prefer to sell through traditional direct
contracts. If advertisers insist on buying these ad placements via programmatic buying,
they can negotiate deals (e.g. programmatic guaranteed deals, preferred deals or private
market deals), which are more expensive and time-consuming to implement. Neverthe-
less, the respondents shared that these deals are limited, and many premium ad placements
are still inaccessible through programmatic buying. Lastly, ad inventories on YouTube and
Facebook – the top two advertising platforms in Vietnam – are sold exclusively on two
DSPs: Google DV360 and Facebook Ad Manager. This fragmentation deters the beneft
of Programmatic Advertising consolidating ad performance across channels.
RQ2: What are the planning and implementation processes for Programmatic Advertising
campaigns?
In general, the new planning and implementation process for Programmatic Advertis-
ing also includes eight steps: (1) setting campaign objectives and efectiveness metrics,
(2) campaign insights discovery, (3) strategic advertising planning, (4) message strategy,
(5) ad creation, (6) media planning, (7) media buying and (8) campaign optimisation and
evaluation. However, there are three important points of discussion to consider.
(1) Setting
(2) (3)
campaign
Discovering Strategic
objective &
campaign advertising
Effectiveness
insights planning
metrics
(4) Message
strategy (6)
Ad
creation
(8)
Campaign
(5) Media
evaluation
planning (7)
Media
buying
! Consecutively Simultaneously
(3) Strategic
advertising
planning
(4) Message
strategy (6)
Ad creation (8)
Campaign
(5) evaluation
Media planning (7) Media
buying
Consecutively Simultaneously
Discussion
Theoretical implications
The study fndings support the model of Programmatic Advertising by Chen et al. (2019),
which states that Programmatic Advertising has two components: Programmatic Buying
and Programmatic Creative. While the former is fully developed, the latter is still under
development. The development stage of the two components was refected through the
experience of the study participants. All participants had experience in implementing
Programmatic Buying campaigns, but only a few had experience with Programmatic
Creative. Furthermore, the discussion on Programmatic Buying was more thorough and
in-depth than that on Programmatic Creative. For instance, Programmatic Buying was
employed extensively in both long-term brand-building and short-term direct-response
campaigns. The advanced deployment of Programmatic Buying was also manifested
through sophisticated customer segmentation and utilisation of lookalike audience target-
ing to extend the campaign’s reach and conversions while addressing the issues of brand
safety and viewability.
By contrast, Programmatic Creative in the local market is still under development
for two reasons: compared to Programmatic Buying, there are fewer campaigns imple-
menting Programmatic Creative, and in terms of the platform infrastructure, Chen et al.
(2019) state that creative programmatic platforms include PCP and CMP. While PCP
was mentioned and discussed by the study participants, CMP was not mentioned at all.
Programmatic Advertising in Vietnam 41
This implies that CMP was not used in the market at the time of this study and likely was
not available; all respondents implementing Programmatic Creative in their online cam-
paigns had to manually design and upload the creative templates and components into
the system. While the lack of CMP can indicate that the local market has not reached the
technology’s state-of-the-art stage, it seems that the model of Programmatic Advertising
by Chen et al. (2019) needs modifcation to strengthen its explanatory power.
Managerial implications
The study identifes two diferent planning and implementation processes for Program-
matic Advertising, depending on the campaign objectives. For campaigns aiming at
long-term brand building, the advertising process is more straightforward because the
planning and implementation phases are separate. That is, the campaign’s overall strate-
gies, including customer segments, targeting strategy, creative strategy and media mix,
remain unchanged throughout the campaign. All decisions that are made during the
implementation stage follow predefned strategies. By contrast, the processes for short-
term direct-response campaigns are more adaptive in the sense that the planning and
implementation phases are integrated. Furthermore, the study fndings suggest that the
strategies, especially customer groups, targeting and even the creative message, are subject
to change during the campaign’s implementation phase.
Regarding changes in the target groups, the study fndings imply that advertisers want
to prioritise ad spend on those who are more likely to make a conversion (e.g. make a
purchase and register a form) soon to achieve the campaign’s KPIs. Acknowledging the
two processes helps advertisers manage the campaigns more efectively in terms of allo-
cating reasonable time and resources at diferent stages of the processes. For instance, the
process for long-term brand-building campaigns can require more time and efort dur-
ing the planning phase than in the implementation phase. Moreover, short-term direct-
response campaigns require continuous time and efort during both phases.
The diferences between the two processes can be explained by the nature of the
two campaign types. Short-term direct-response campaigns are performance driven
and demand immediate results, while long-term brand-building campaigns aim for
long-term impacts, such as changing consumers’ perception or behaviour towards the
brand. Therefore, even though Programmatic Advertising technologies have changed
the advertising process, they are likely not the sole contributor. Advertisers also play
a signifcant role in shaping the processes. For instance, the programmatic mechanism
works the same in both processes; the audience and campaign performance data are also
collected and available in real time in both processes. However, digital specialists must
decide how to leverage the mechanism to meet the campaign’s objective. In that sense,
Programmatic Advertising can enhance the advertising campaign’s performance and
the efciency of its advertising spend. Yet, the enhancement level essentially depends
on the in-depth understanding and expertise of the digital specialists. In other words,
adopting Programmatic Advertising (i.e. shifting the budget from traditional direct buy
to Programmatic Buying and leveraging dynamic ads) because it has a promising advan-
tage (i.e. it delivers the right message to the right person at the right time) without a
thorough understanding of the technologies and careful preparation could result in a
great expectation gap.
The study fndings indicate two main reasons for this expectation gap. First is the
justifcation of additional fees (e.g. platform fee, data fee and tech fee) when executing
42 Thanh Tiet and Heikki Karjaluoto
Programmatic Advertising. These fees are costly and vary depending on the depth of
the targeting layers, diferent DMPs and the sophistication of the technologies involved
when integrating diferent intermediates in the programmatic ecosystem; advertisers
and agencies must be aware of these fees while planning their campaigns. Additionally,
as the data fees keep increasing with added targeting layers, the digital specialists need
to justify the optimal point between the cost and the benefts for each layer. Further-
more, while the issue of non-transparency fees was not mentioned in the interviews, it
was discussed in the research literature. Hence, advertisers and agencies should be aware
of this issue. Secondly, programmatic technologies are complicated. The most common
issue from the case study was incompatibility between platforms, which interrupted
the delivery of ad impressions. Moreover, complicated technologies also require more
time and technical expertise than simpler approaches when setting up programmatic
campaigns. Thus, digital specialists must not only be skilful at operating the DSPs but
must also have a systematic understanding of diferent platforms in the programmatic
ecosystem and their working mechanisms so that they can execute their campaigns
efectively and efciently.
The study fndings also point to a gap between practice and theory, which could
potentially lead to inefective implementation of Programmatic Advertising campaigns.
Neumann, Tucker, and Whitfeld (2019) and Sylvester and Spaeth (2019) highlight a
potential problem in both the accuracy and the coverage of audience data: third-party
audience data could lack accuracy and coverage due to self-reporting faults, data collec-
tion technique faults, etc. Additionally, the biased ad delivery and optimisation algorithms
discussed by several researchers (i.e. Ali et al., 2019; Gordon et al., 2019; Lambrecht and
Tucker, 2019; Lewis, Rao, and Reiley, 2015) are of concern. In one instance, the algo-
rithms automatically prioritise showing information to one customer segment over oth-
ers because of inherent algorithm biases. Those biased algorithms can cause misleading
campaign results and evaluations. Moreover, the algorithms can display ads to buyers who
would make a conversion regardless of whether they see the ads or not, which wastes
the impressions because they do not earn additional advertiser conversions. However,
the digital specialists in the market seem to be unaware of these issues, which is alarming
because audience data and system algorithms are fundamental aspects of precision target-
ing of programmatic buying.
Hence, it is suggested that advertisers and agencies should frst acknowledge these
issues and take gradual actions to address them. Regarding the accuracy of audience data,
advertisers and agencies should begin investigating the audience data collection and veri-
fcation processes of data vendors. These insights will help them determine whether to
pay data fees for new layers of audience data in their campaigns. Furthermore, systematic
assessment of these third-party audience data sources should be conducted if possible.
Regarding the biased algorithms, it seems that operating the algorithms is out of digital
specialists’ control, making it difcult for them to intervene in the systems and mitigate
such biases. Despite that, digital specialists should still be mindful of the biased algorithms
issue when interpreting the campaign’s data, evaluating the campaign’s performance and
taking strategic actions based on those data. The respondents noted that the audience
data results post-campaign could be used to redefne a brand’s target audience, which
underlines this suggestion.
Finally, the study fndings suggest that even though Programmatic Advertising ofers
automation in the implementation steps (e.g. automatically chooses the right ad place-
ment to serve ads and automatically generates personalised ads on a large scale), the
Programmatic Advertising in Vietnam 43
workload does not necessarily decrease. Digital specialists still need to supervise the
system to intervene promptly, especially given that technologies are still developing
and technical issues can occur during the campaign period. Nevertheless, too much
human intervention is not encouraged. The literature and the case study fndings imply
that the algorithms of programmatic technology can operate and improve based on the
feedback loop. Hence, the role of digital specialists should skew towards supervising
and guiding the system instead of doing its job. Furthermore, there is an increase in
workload concerns with generating the increased creative templates and components
that are required in dynamic creative so that the systems have resources to create difer-
ent combinations of ad templates and creative components. This is important because
the core of Programmatic Creative is to create personalised ads at scale, implying that
the system needs a signifcant amount of creative element input to customise ads that
are relevant to diferent audiences in diferent contexts. In other words, the lack of
creative component input hinders the strength of dynamic creative. In conclusion, the
automation ofered by programmatic technology should be viewed as an extension of
digital specialists that helps them plan and implement online campaigns rather than
replace them.
Disclaimer
The research presented in this chapter was collected for my thesis, Thanh Tiet, University
of Jyväskylä Master’s thesis The planning and implementation process of programmatic advertising
campaigns in emerging markets (2020). The copyright for this JYU thesis belongs to me as
the Author. Research presented here has not been otherwise previously published.
Further reading
Boston Consulting Group. (2018). A Guaranteed Opportunity in Programmatic Advertising. Available at:
www.bcg.com/publications/2018/guaranteed-opportunity-programmatic-advertising.aspx (accessed
21 April 2020).
Digiday. (2017). Digital AD Concerns Have an Unlikely Winner: Emerging Markets. Available at: https://
digiday.com/?p=251945 (accessed 21 April 2020).
Gordon, B. R., Jerath, K., Katona, Z., Narayanan, S., Shin, J., and Wilbur, K. C. (2019). ‘Inefciencies
in digital advertising markets’. Working Paper. Available at: https://arxiv.org/abs/1912.09012 (accessed
4 February 2020).
44 Thanh Tiet and Heikki Karjaluoto
IAB. (2020). Glossary of Terminology. Available at: www.iab.com/insights/glossary-of-terminology/
(accessed 15 March 2020).
The Information. (2019, Dec 10). Facebook and Google Balance Booming Business with Censorship Pressure
in Vietnam. Available at: https://www.theinformation.com/articles/facebook-and-google-balance-
booming-business-with-censorship-pressure-in-vietnam (accessed 15 Apr 2020).
Lewis, R., Rao, J. M., and Reiley, D. H. (2015). ‘Measuring the efects of advertising: The digital fron-
tier’. In A. Goldfarb, S. M. Greenstein, and C. E. Tucker (Eds.), Bureau of Economic Research: Economic
Analysis of the Digital Economy (pp. 191–218). Available at: www.nber.org/chapters/c12991
Li, H. (2017). Pre-conference Session: Toward A New Discipline of Computational Advertising. Lubbock:
American Academy of Advertising. Available at: https://search.proquest.com/docview/1937669922
?accountid=11774 (accessed 26 January 2020).
Market Realist. (2019, Jan 11). Why the Vietnamese Market is Important for Facebook. Available at: https://
marketrealist.com/2019/01/why-the-vietnamese-market-is-important-for-facebook (accessed 15
Apr 2020).
MMA. (2018). Mobile Ecosystem & Sizing Report – Vietnam 2017/8. Available at: http://vietnam.
mmaglobal.com/wp-content/uploads/2018/11/mma_mobile_marketing_ecosystem_report_
2017_-_vietnam_0.pdf (accessed 16 April 2018).
WeAreSocial. (2020). Digital 2020: Vietnam. Available at: https://datareportal.com/reports/digital-
2020-vietnam (accessed 15 April 2020).
Zenith. (2018). Brands Must Reassess Customer Acquisition as They Shift to Mobile. Available at: www.
zenithmedia.com/mobile-share-of-advertising-market-to-exceed-30-in-2020-1/ (accessed 17 April
2021).
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AI’. Journal of Advertising, 48(4), pp. 347–355. https://doi.org/10.1080/00913367.2019.1654421
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Section 2
Introduction
Digital consumers are no longer dependent on brands for information to support their
consumption and decision-making processes; they now proactively seek information
using cyber channels to evaluate the suitability of services or products for their personal
needs (Rowley, 2004). This phenomenon has shifted the profound nature of modern
customers from passive to proactive. With brands recognising this shift, company websites
have become a crucial channel for companies’ marketing communication through which
they can support and strengthen consumer experience.
Previous research related to consumer experiences has mainly focused on the utilitar-
ian aspects of products and services, while experiences that are evoked and provided by
brands have received relatively scant attention (Brakus, Schmitt, and Zarantonello, 2009).
Brand experience is still lacking academic attention, and due to its ‘practical relevance’
(Khan and Rahman, 2015, p. 10), there have been calls for further research on the topic.
Importantly, previous studies on Consumer Brand Experience have mostly considered
ofine settings, justifying the need to study this topic in an online context (Hamzah, Syed
Alwi, and Othman, 2014).
Against this backdrop, this chapter aims to examine (a) how a website’s appearance and
technical quality dimensions evoke online Consumer Brand Experiences and (b) investi-
gate how online Consumer Brand Experience develops consumer brand trust as well as
motivates usage behaviour and eWOM. Next, we discuss Consumer Brand Experience
and website quality. This is followed by the research model, hypothesis development and
research methodology. Finally, the empirical fndings are presented, and we conclude the
chapter by discussing the implications, limitations and further research ideas.
Conceptual background
Brand experience is a multidimensional concept and is defned as ‘sensations, feelings, cog-
nitions, and behavioral responses evoked by brand-related stimuli that are part of a brand’s
design and identity, packaging, communications, and environments’ (Brakus, Schmitt,
and Zarantonello, 2009, p. 52). Brakus, Schmitt, and Zarantonello’s (2009) examined
Consumer Brand Experience in ofine context; however, because the source of experi-
ences does not signifcantly afect their nature, the model can be adopted for measuring
the phenomenon in an online context (Clef, Walter, and Jing, 2018, p. 11). Consumer
Brand Experience in an online context, in turn, is defned as ‘a holistic response to the
stimuli within a website environment’ (Morgan-Thomas and Veloutsou, 2013, p. 22).
DOI: 10.4324/9781003093909-7
50 Joel Konttinen et al.
Brand-related stimuli are recognised as the foundation of consumer responses,
which are defned as brand experience (Brakus, Schmitt, and Zarantonello, 2009).
These stimuli consist of visual and cognitive aspects of the brand’s identity that can be
observed and perceived by consumers when searching/shopping for and consuming
a brand. In the online context, brands provide these brand-related stimuli via several
interactive touchpoints and a wide range of channels, such as websites, SM and blogs
(Clef, Walter, and Jing, 2018).
Brakus, Schmitt, and Zarantonello (2009) constructed a four-factor model for the
brand experience dimension scale, including the sensory, afective, intellectual and
behavioural dimensions. These dimensions were validated within the product and ser-
vice brand context (Nysveen, Pedersen, and Skard, 2013). Sensory brand experience
relates to visual or other sensory experiences evoked by the brand and brand related
stimuli. The afective dimension refers to the emotional experiences evoked by the
brand. The behavioural dimension is linked to intentions, actions and bodily experi-
ences. Lastly, the intellectual dimension is related to the cognitive experiences that a
brand evokes and stimulates.
Positive online experiences are positively related to the consumption behaviour of
online users, such as the intention to use the web again and the time consumers are will-
ing to spend online (Novak, Hofman, and Yung, 2000). Consumer brand experiences
in the website context refer to ‘a consumer’s positive navigations and perceptions with a
specifc website’ (Ha and Perks, 2005, p. 440), which afect brand trust and higher con-
sumption of the website.
Aladwani and Palvia (2002) developed an instrument for measuring the concept of
web quality that includes three dimensions: technical adequacy, web content (specifc
content and content quality) and web appearance. Technical adequacy refers to techni-
cal aspects, such as security, ease of navigation and search facilities, of the website (Al-
Qeisi et al., 2014). According to Aladwani (2006), the technical quality of a website
has a major impact on user behaviour. Web content quality refers to how the website is
perceived in terms of its usefulness, clarity and accuracy (Al-Qeisi et al., 2014). Specifc
content quality refers to specifc company-related information (i.e. contact information
and the company’s general information) and information concerning its oferings in
more detail, such as product or service information (Al-Qeisi et al., 2014). Web appear-
ance includes the visual design of the website and how the visual elements and their
usage in website design correlate with a customer’s emotional and behavioural responses
(Chang et al., 2014). Appearance quality is one of the most infuential web quality ele-
ments because it has a major impact on customer-related outcomes, such as satisfaction,
perceived service quality (Wang, Hernandez, and Minor, 2010), intentions and purchas-
ing behaviour (Chang et al., 2014), activation of search (Wang, Hong, and Lou, 2010)
and attitudes towards the website (Aladwani, 2006).
Brand Trust
Website
Technical H4
Quality
H1 Brand H5 E-WOM
Experience Intentons
H2 H6
Website
Appearance
Quality
H3
Behavioural
Intentons
According to Wang, Hong and Lou (2010), web aesthetics and their evoked afective and
positive experiential states can enhance purchase intentions (p. 126). Wang, Hernandez
and Minor (2010) argue that web aesthetics afect a user’s perception of the web service’s
quality and satisfaction and consequently enhance brand-related behavioural outcomes.
Lorenzo-Romero, Constantinides, and Alarcón-del-Amo (2013) argue that, in the online
context, impulsive shopping results from experiential processing and emotions that web
aesthetics and design elements create. Thus, the following hypothesis is proposed:
In the context of this study, we examine Word-of-Mouth (WOM) in the online context
(eWOM). Chen et al. (2014, p. 582) defne WOM as ‘informal communication relating
to the characteristics of a business or product occurring between consumers’. Consum-
ers’ brand experiences are easily refected in their messages about those brands in various
digital channels (i.e. SM and product reviews and recommendations) (Serra-Cantallops,
Ramon-Cardona, and Salvi, 2018). Customers’ online experiences are highly related to
their behaviour and intentions, and eWOM and WOM are identifed outcomes of online
customer experience (Bilgihan, Kandampully, and Zhang, 2016). WOM as a behavioural
Online consumer brand experience 53
construct is afected by the emotions and motives of the customer, thus emphasising the
importance of customer satisfaction; satisfed customers are likely to produce favourable
WOM related to brand oferings (Chen et al., 2014). Positive Consumer Brand Experi-
ences can produce eWOM and eWOM intentions (i.e. in the form of referrals) (Serra-
Cantallops, Ramon-Cardona, and Salvi, 2018). On this basis, we propose the following:
Methodology
This study used a quantitative research design, including an online survey, as the data col-
lection tool. The study participants were randomly selected using a university newsletter
where the study was advertised. Participants were asked to visit IKEA’s website briefy
before completing the questionnaire. IKEA is a furniture and home appliance producer
from Sweden with a well-established and recognisable brand. Notably, this study was not
conducted in cooperation with the brand; rather, the brand was chosen for data collection
due to its brand recognition and familiarity. The survey was distributed to respondents via
SM channels and email newsletters. In addition to SM and email, the questionnaire was
distributed by a research company specialising in collecting research data online.
We used existing multi-item scales to measure the study constructs (see Table 5.1).
(Continued)
54 Joel Konttinen et al.
Table 5.1 Continued
Results
In total, 202 usable responses were received. The demographic profle of the participants
is shown in Table 5.2.
The respondents had signifcant online shopping experience; close to half (41%)
reported having 6–10 years of experience, and around one-third (33%) reported having
more than 10 years of experience.
Factor analysis
We frst analyzed the data with exploratory factor analysis. The results indicated that
the data were suitable for confrmatory factor analysis, which was run using partial least
squares analysis.
Measurement model
The model included a multidimensional construct (Consumer Brand Experience); there-
fore, it presented the Consumer Brand Experience construct as a second-order factor
Online consumer brand experience 55
Table 5.2 Demographic profle of the respondents
Gender N %
AVE (1) (2) (3) (4) (5) (6) (7) (8) (9)
(Duarte and Amaro, 2018) to study the individual efects of the dimensions on the main
construct. As suggested by Duarte and Amaro (2018), using the same measurement met-
rics with frst- and second-order constructs is valid, and the produced results include path
coefcients, predictive relevance and explained variance (p. 295).
The measurement model was acceptable because the factor loadings, alphas and con-
vergent and discriminant validity were well within the range of the suggested cut-of
values (Hair et al., 2017) (see Table 5.3).
No support was found for the efects of technical quality on Consumer Brand Experi-
ence (β = 0.152, ns), thus rejecting H1. The efect of appearance quality on Consumer
Brand Experience was supported (β = 0.368, p < 0.01), confrming H2. However, appear-
ance quality had no efect on behavioural intentions (β = 0.046, ns); thus, we reject H3. We
found strong support for H4–6, confrming that Consumer Brand Experience is strongly
related to brand trust (H4), eWOM intentions (H5) and behavioural intentions (H6).
As Consumer Brand Experience was a second-order construct, the efects of the four
dimensions of Consumer Brand Experience were also measured. The sensory brand
experience dimension showed that Consumer Brand Experience was high, with an R2
value of 0.670 (67%). The lowest value among the dimensions was found in behavioural
brand experience, with an R2 value of 0.345 (35%). The intellectual and afective brand
experience dimensions explained 62% (R2 = 0.617) and 55% (R2 = 0.549) of the vari-
ance of consumer brand experience, respectively. The results of the structural model are
shown in Figure 5.2.
Discussion
This chapter aimed to investigate the role of Consumer Brand Experience and its pro-
posed outcomes within the online context and gain insights into the aesthetics and tech-
nical attributes of websites, including their relationship with evoking consumer brand
experience.
This study presents three main implications:
Brand Trust
Website
Technical 0.626***
Quality
0.368** 0.701***
Website
Appearance
Quality
0.042 ns
Behavioural
Intentons
most infuential factor regarding the outcomes of the research model presented
here, which contrasts with previous studies, where website technical qualities and
usability-related attributes outperformed aesthetic properties as a strong predictor
of favourable outcomes (Wang, Hong and Lou 2010). Notably, aesthetics attributes
have been strong predictors in attitudes related to websites in the past (Aladwani,
2006), but these studies mostly investigated the relationship between a website’s
attributes and certain outcomes, such as behavioural intentions. The results of the
current study suggest that website aesthetics evoke brand-related experiential states,
leading to favourable outcomes, whereas technical attributes have no signifcant
efect on the outcomes.
2 The results of this study indicate that the studied technical qualities of websites do
not translate to experiential and behavioural responses, whereas website appearance
stimulates the experiential dimensions that lead to behavioural outcomes. The results
indicate that the appearance qualities of a website evoke the most processing, which
has a signifcant positive efect on brand trust, behavioural intentions and eWOM
intentions.
3 This study proposes that the most favourable and reliable option for measuring
Consumer Brand Experience is measuring it as a second-order construct.
The implications of this study for managers include emphasising the role of consumer
brand experiences as a wider concept and its predictive capabilities on consumer behaviour
in online settings. Our fndings suggest that managers should consider website aesthetics
attributes not for their direct efect on outcomes but as an enhancer of consumer brand
experience. The efect of sensory brand experience should be considered an important
aspect of web design for brands due to its strong and signifcant relationship with behav-
ioural and eWOM intentions and brand trust. In the online context, the sensory brand
58 Joel Konttinen et al.
experience can be considered a major infuencer of favourable outcomes. By enhancing
the information processing routes stimulated by pleasurable consumer brand experiences
and building technically solid websites with direct efects on behavioural intentions, com-
panies may utilise the favourable relationships and their outcomes of these constructs. By
evoking several of the Consumer Brand Experience dimensions, companies can enhance
the probability of behavioural intentions and brand trust. Lastly, the efect of Consumer
Brand Experience on eWOM intentions can be emphasised.
Disclaimer
The research presented in this chapter was collected for my University of Jyväskylä Mas-
ter’s thesis examining the antecedents and consequences of web brand experience (2019).
The copyright for this JYU thesis belongs to Joel Konttinen as the Author. Research
presented here has not been otherwise previously published.
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6 User experience of an
e-commerce website
A case study
Saima Ritonummi and Outi Niininen
Introduction
User Experience (UX) consists of the user’s perceptions and responses when interacting
with a system, such as a website. UX research addresses Human–Computer Interaction
(HCI) as a whole, including the user’s feelings and thoughts about their experiences,
whereas the preceding task-related ‘usability paradigm’ addressed the user’s ability to use an
interface, including the efciency and efectiveness aspects of the interaction (Hassenzahl
and Tractinsky, 2006). A positive UX is an essential component of a satisfactory online
customer journey on e-commerce websites. Both UX development and customer jour-
ney planning aim to support users in working as efortlessly and efciently as possible by
helping them perform tasks to accomplish their goals. The essence of designing for UX
and customer journeys is identifying successful and unsuccessful features and touchpoints
that guide users towards their desired actions. Addressing both pragmatic and hedonic user
needs with intentional UX design on e-commerce websites is necessary to help users opti-
mise the interaction (Garrett, 2011). Identifying the duality of user needs stems from the
holistic view of HCI and examining the emotional outcomes and the pragmatic usability
aspects of the interaction (Falk, Hammerschmidt, and Schepers, 2009).
This chapter presents relevant academic research on UX and online customer journeys
on e-commerce websites. The objective is to outline why thoughtful UX development
and customer journey planning is an important, continuous process for e-commerce
websites. The study contributes to UX research with a combination of qualitative and
quantitative UX research methods, addressing both pragmatic and hedonic aspects of UX
and the dual user needs.
What is UX?
Ofcially established in the 1990s, the concept of UX is largely based on Norman and
Draper’s work in the 1980s, which advanced the HCI research feld signifcantly. UX is
associated with many meanings and aspects of technology use, such as aesthetics, afor-
dances, functionality, responsiveness and the hedonic aspects of interaction (Hassenzahl
and Tractinsky, 2006), which include, for example, emotion, fun and fow experiences
(Law, 2011). UX research is specifcally interested in the user’s physical and internal states
because UX includes ‘all the user’s emotions, beliefs, preferences, perception, physical
and psychological responses, behaviours and accomplishments that occur before, during
and after use’ (ISO, 2019, p. 3). Essentially, UX research examines how perception, action
and cognition are related to one another and what role emotional user needs plays in UX
DOI: 10.4324/9781003093909-8
62 Saima Ritonummi and Outi Niininen
(Law, 2011). Per Roto, Joutsela, and Nuutinen (2016), focusing on emotions is important
because poor UX and usability problems often cause negative afective reactions (such as
frustration), and UX can be improved by reducing those problems.
Many researchers agree that UX consists of three factors: a user interacting with a system
in a specifc context. A system is defned by the characteristics of the system, including its
functionalities and performance. A user is the person who is interacting with the product,
and the context of use is where the interaction occurs (Hassenzahl and Tractinsky, 2006;
Roto et al., 2011). User-Centered Design (UCD) (also referred to as Human-Centered
Design) examines particular people doing particular tasks in a particular context (Ritter,
Baxter, and Churchill, 2014), which addresses the three facets of UX (user, system and
context). UCD aims to help users work faster, make fewer mistakes and accomplish their
goals with minimal efort (Garrett, 2011). Usable systems are more likely to be success-
ful, both technically and commercially. Adopting the UCD approach improves UX and
accessibility, including reduced stress and discomfort related to the interaction, which can
provide a competitive advantage for the business (ISO, 2019).
Data collection
The case company is a consumer electronics brand. Their website was redesigned in 2019
to improve its performance, including especially UX, conversion rate and sales revenue.
The company also considers its website as an important platform for introducing its brand
and products to new and existing customers. This study examined UX on the redesigned
website via both a cognitive walkthrough and a UX questionnaire.
The procedure was established with three pilot respondents. Six respondents (n=6)
participated in the study, as in UX and usability testing practice it is often suggested that
about 85%–90% of usability problems can be discovered with six users (Goh et al., 2013).
To match the case company’s target audience, all participants were aged 26–35 and had
over 10 years’ experience of online shopping. For the purpose of this study (i.e. to simu-
late a normal online shopping situation), respondents were observed interacting with the
website on their own computer at their home.
In this study, the cognitive walkthrough consists of six main tasks: go to the brand’s web-
site, evaluate the product’s attributes, add the product to the shopping cart, proceed to the checkout,
User experience of an e-commerce website 65
Add the
Go to Evaluate
product to Proceed Sign up for Complete
the the
the to the the an exit
brand product's
shopping checkout newsletter interview
website attributes
cart
sign up for the newsletter and complete an exit interview. The task fow is presented in Figure
6.1. Each main task includes sub-tasks, such as ‘enter homepage’, ‘navigate to product
pages’ and ‘examine product ofering’.
The participants performed tasks on their computers and the walkthroughs were recorded
as screen recordings with audio. Before starting the walkthrough, the participants were
briefed about the procedure and informed that the usability of the website is what is being
evaluated, not their IT skills. To capture frst-time users’ impressions, it was ensured that
participants had not visited the website before. After the walkthrough, participants com-
pleted an exit interview, which included UEQ and demographic background questions.
Findings
The cognitive walkthrough fndings are introduced to provide background information
for UEQ results and insights on the participants’ evaluation of their UX.
the smaller the sample, the harder it is to draw indisputable conclusions about the data
(Schrepp, Hinderks, and Thomaschewski, 2017).
In the UEQ, values over 0.8 represent a positive evaluation, values between −0.8
and 0.8 represent a neutral evaluation and values less than −0.8 represent a negative
evaluation. The scale ranges between +3 (extremely good) and −3 (extremely bad), but
because participants tend to avoid extreme answers on questionnaires, values in the UEQ
normally range between +2 and −2 (Schrepp, 2019). On average, the pragmatic quality
of the website was evaluated as positive by the participants, while both hedonic quality
and attractiveness were considered neutral. The website scored the highest in pragmatic
quality (0.81) and the lowest in hedonic quality (0.06–0.04), while attractiveness scored
in the middle (0.44). On the pragmatic quality scales, the website scored highest in
dependability, followed by efciency and perspicuity. On the hedonic quality scales, the
website scored better in stimulation than in novelty. The performance on each UEQ scale
is presented in Table 6.1.
Based on their experience with the website, the participants evaluated the dependability
of the website as its best quality (i.e. they felt in control of the interaction). Dependability
also had the least variance in answers. Novelty – the website’s innovativeness and ability
to catch the user’s interest – scored towards the lower end of neutral and had the highest
variance in answers among the participants.
On the individual item level, the website scored highest in easy to learn (1.7), followed
by efcient (1.5) and predictable (1.3). All three items measure pragmatic quality. Notably,
on e-commerce websites, predictability can be a positive quality; websites can beneft
from following conventions, such as commonly known navigation structures and ico-
nography (Schrepp, 2019). The website scored lowest in inventive (−1.0), leading edge,
(−0.5), innovative (−0.2) and creative (−0.2). Hence, the website was evaluated higher on
the conventional, usual, conservative and dull items, which describe the design’s novelty. The
results per item are presented in Figure 6.2.
The UEQ fndings suggest that the pragmatic quality of the website is good: it is
easy to learn, efcient and predictable. However, hedonic quality (i.e. innovativeness and
catching the user’s interest) and attractiveness could be improved.
Implications
The fndings of this study support UX research and identify both pragmatic and hedonic
user needs. The participants accomplished most of the tasks in the cognitive walkthrough
with ease and the website scored well in pragmatic quality. The customer journey on the
User experience of an e-commerce website 67
UEQ Results
Attractiveness Annoying/Enjoyable
Bad/Good
Unlikable/Pleasing
Unpleasant/Pleasant
Attractive/Unattractive
Friendly/Unfriendly
Unpredictable/Predictable
Slow/Fast
Complicated/Easy
Obstructive/Supportive
Not secure/Secure
Inefficient/Efficient
Impractical/Practical
Cluttered/Organized
Inferior/Valuable
Boring/Exciting
Not interesting/Interesting
Conventional/Inventive
Usual/Leading edge
Demotivating/Motivating
Confusing/Clear
website also seemed to please the participants. However, per the UEQ fndings, hedonic
quality could be improved.
Conclusions
This study examined UX as well as the pragmatic and hedonic user needs that drive
users on their customer journey on an e-commerce website. Studying UX and customer
journeys determined a common goal: UX research is conducted to identify success-
ful and unsuccessful features from the user perspective, and customer journey mapping
is conducted to identify successful and unsuccessful touchpoints. Essentially, both UX
design and customer journey mapping are about helping users accomplish their goals
more efciently, efectively and satisfactorily. Good usability is a predictor of positive
UX, and positive UX is a predictor of adoption. Positive UX can also predict a trusting
customer–company relationship, which is more likely to result in purchase intention.
Understanding that UX and the online customer journey are intertwined helps identify
possible problems and pain points that users may encounter in the e-commerce context
to help solve any problems that could prevent them from accomplishing their goals.
Future research could broaden the scope of UX from a single user interface to multi-
ple-touchpoint customer experiences (Roto, Joutsela, and Nuutinen, 2016). Addition-
ally, addressing both pragmatic and hedonic user needs is important for serving a wider
range of users. For example, experienced and inexperienced users have diferent needs
for browsing an e-commerce website: less experienced users need more well-organ-
ised content and product information, whereas experienced users have more emo-
tional and experiential needs for the interaction (Falk, Hammerschmidt, and Schepers,
2009). This is why addressing usability and UX as well as the customer journey on an
e-commerce website are extremely important. UX is always a result of the user, the
system and the context of the interaction (ISO, 2019). However, ‘a design is not usable
or unusable per se’. On a pragmatic level, the most important interaction outcomes
from the user perspective are that the interface becomes familiar quickly, it is easy to
learn and it helps them accomplish their goals. Providing pragmatic, useful content for
informed decision-making is important, but providing desirable content that flls hedonic,
emotional user needs is equally important (Interaction Design Foundation, 2019 – see
Further reading).
Disclaimer
The research presented in this chapter was collected for my thesis; Saima Ritonummi,
the University of Jyväskylä Master’s thesis User experience on an ecommerce website: a case
study (2020). The copyright for this JYU thesis belongs to me as the Author. Research
presented here has not been otherwise previously published.
Further reading
Harley, A. (2018). ‘UX guidelines for ecommerce homepages, category pages, and product listing pages’.
Nielsen Norman Group. Available at: www.nngroup.com/articles/ecommerce-homepages-listing-
pages/ (accessed 26 July 2020).
Interaction Design Foundation. (2018). How to Conduct a Cognitive Walkthrough [Online]. Available at:
www.interaction-design.org/literature/article/how-to-conduct-a-cognitive-walkthrough (accessed
16 August 2020).
Interaction Design Foundation. (2019). Usability: A Part of User Experience [Online]. Available at: www.
interaction-design.org/literature/article/usability-a-part-of-the-user-experience (accessed 16 August
2020).
InVision (2020). Website Navigation Design: What You Need to Know (Plus 5 Best Practices) [Online]. Avail-
able at: www.invisionapp.com/inside-design/website-navigation-design/ (accessed 26 August 2020).
ISO 9241–210:2019. (2019). ‘Ergonomics of human–system interaction part 210: Human-centred
design for interactive systems’. International Organization for Standardization. Available at: www.iso.org/
obp/ui/#iso:std:iso:9241:-210:ed-2:v1:en (accessed 14 August 2020).
Roto, V., Law, E., Vermeeren, A., and Hoonhout, J. (2011). ‘User experience white paper: Bringing
clarity to the concept of user experience’. In Dagstuhl Seminar on Demarcating User Experience, September
15–18, 2010. Available at: https://drops.dagstuhl.de/opus/volltexte/2011/2949/ (accessed 16 August
2020).
Schrepp, M. (2019). User Experience Questionnaire Handbook: All You Need to Know to Apply the UEQ
Successfully in Your Projects. Available at: www.ueq-online.org/ (accessed 6 August 2020).
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7 AI-based voice assistants for
digital marketing
Preparing for voice marketing
and commerce
Alex Mari and René Algesheimer
Introduction
Shopping behaviour is undergoing a revolution that is primarily enabled by digital
consumer technologies, which are being increasingly powered by Artifcial Intelli-
gence (AI). Among these technologies, in-home Voice Assistants (VAs), such as Ama-
zon Alexa and Google Home, have witnessed unprecedented growth (Kaplan and
Haenlein, 2019). The physical placement of these devices at the core of consumers’
domestic life allows for repeated, ongoing interactions that fulfl functional and social
needs (Ammari et al., 2019; McLean and Osei-Frimpong, 2019). Defned as ‘voice-
based interfaces that can actively guide consumer decisions on the basis of artifcial
intelligence’ (Dellaert et al., 2020, p. 2), VAs can naturally converse with users, con-
textually elaborate requests and dynamically expand their knowledge while learning
from mistakes (Mari, 2019a).
The physical distancing and stay-at-home policies that have been introduced due to
COVID-19 are also requiring people to adopt and intensify their use of new shop-
ping behaviours. Greater availability of products, higher shopping convenience and bet-
ter value for the money are the key drivers of the adoption of new shopping methods
(40% of US consumers), diferent brands (36%) and novel retailers and websites (33%)
(McKinsey, 2020a – see Further reading). The penetration of digital services for grocery
shopping in Europe has increased to 51% – a growth factor of 1.8 (McKinsey, 2020b – see
Further reading). In the United States, e-commerce penetration has grown more dur-
ing the pandemic than in the past ten years. Said diferently, e-commerce has accelerated
the shift away from physical stores to digital shopping by roughly fve years (IBM Retail
Index, 2020 – see Further reading).
These rapid societal and technological changes are remodelling consumer journeys in
myriad of ways. The prolifc environment for AI-based devices is expected to develop at
exponential rates while altering consumer decision-making and posing new challenges
for digital marketers (Davenport et al., 2020).
This chapter discusses the adoption of VAs for marketing and commerce purposes,
followed by exploring the unanticipated consequences of VAs on human behaviour in
the context of voice shopping. We then highlight how these changes may afect Digital
Marketing (DM) and e-commerce practices before closing with opportunities for future
research.
DOI: 10.4324/9781003093909-9
AI-based voice assistants 73
The parallel rise of voice marketing and Voice Commerce
With the distinction between humans and machines becoming increasingly blurred, AI-
based VAs are expected to substantially alter the decision-making process throughout
the entire consumer journey, from product search to repurchase (e.g. Dawar and Bendle,
2018 – see Further reading; Mandelli, 2018). Two parallel forces are shaping the adop-
tion of VAs: (a) faster market penetration due to more than 200 million in-home smart
speakers being used globally within a few years and (b) the exponential growth of app
marketplaces (e.g. 100,000+ voice ‘skills’ available on the Alexa Skills Store and 10,000+
‘actions’ available on Google Home), which ofer infnite interaction possibilities.
A combined push from consumers and companies for their respective objectives is
also shaping the depth and breadth of VA usage. While the number of consumers seek-
ing more sophisticated brand experiences through third-party apps or native capabilities
is rapidly growing, even simple commands, such as playing music, providing weather
information and setting alarms, are creating more immersive voice experiences from the
marketing and sales perspectives.
DM is about delivering the appropriate communication to specifc targets at the opti-
mal time via the most productive channels. With the introduction of voice touchpoints,
marketers can employ voice marketing activities to strengthen their relationship with stra-
tegic audiences. For example, managers can utilise a mix of push and pull communication
mechanisms, which are often powered by AI, to ofer better convenience, relevance and
unique brand experiences (Mari, 2019b). Marketers can leverage voice channels using a
combination of owned, earned and paid media actions in coordination with other digital
and social media (SM) touchpoints to drive efciencies and build intimate one-to-one
relationships with consumers at scale.
Voice marketing
From a voice marketing perspective, VAs represent a novel form of interaction with con-
sumers. As the adoption of VAs grows, it is strategic for brands to develop a strong voice
presence that fulfls the needs of sophisticated consumers as well as those with disabilities.
According to Abobe, about 20% of marketing organisations are using voice-activated ser-
vices to improve UX and engagement, and 90% of those remaining are planning to intro-
duce voice apps by 2021 (see Further reading). Companies have mainly launched voice
marketing initiatives in the area of branded actions or skills. These voice applications are
built around four main service objectives: utility (e.g. hailing an Uber), entertainment
(e.g. coaching a player on Call of Duty), informational (e.g. obtaining stain removal tips
from Tide) and educational (e.g. learning about Mars from NASA).
Some companies quickly capitalised on the voice trend and established a superior voice
presence. For example, Diageo (a British alcohol beverage company) has consistently
invested in voice marketing by launching several voice-based applications for its brands.
Among its portfolio, Johnnie Walker was the frst brand to build an Alexa skill to enrich
the tasting experience. Beginning in 2016, Johnnie Walker consumers could listen to
insights, suggestions and stories to create a unique whiskey-tasting experience. This skill
provided an extra service that enhances the properties of a physical product and leads
74 Alex Mari and René Algesheimer
to deeper emotional connections with the brand. Given the promising results, Diageo
extended the format to the Scotch brand Talisker. The skill replicates a guided tasting that
the brand ofers in its distillery. The ‘Talisker Tasting Experience’ provides a step-by-step
audio guide to help consumers enjoy and appreciate the award-winning whiskey. Because
tasting experiences usually take place in a living room and during intimate conversations,
the VA user can impress friends while interacting with the brand in a social context.
Voice Commerce
The concept of e-commerce has evolved to include not only the acts of buying and sell-
ing products via the Internet but also making products easier to discover and purchase. As
a consequence, the disciplines of DM and e-commerce have become increasingly inter-
connected. Additionally, in the context of VAs, the terms ‘Voice Commerce’ and ‘Voice
Shopping’ refer not only to the transactional act of placing an order directly or through
marketplaces but also to the technical capabilities and communication activities that allow
users to search for a product, listen to reviews, add items to a list, purchase goods or ser-
vices, track an order, access customer service, etc.
From a Voice Commerce perspective, VAs have the potential to alter all the stages
of the consumer journey substantially. Managers have come to realise that VAs already
possess the technical capabilities to lead interactions with consumers, from activating
passive users to automating product purchases. Adobe (see Further reading) suggests that
almost half of all VA owners initiate product searches (47%), create shopping lists (43%)
and make price comparisons (32%). However, AI-aware managers predict that product
reordering (automation) will soon be the most used VA commercial feature (74%), fol-
lowed by order tracking (71%), product search (68%) and product purchase (66%) (Mari,
Mandelli, and Algesheimer, 2020).
Commercially, VAs ofer three main revenue stream opportunities.
1 Marketers can deliver premium services as part of their voice experiences, such as
interactive stories or exclusive features. Through In-Skill Purchasing (ISP), users
can seamlessly shop for products using payment options that are associated with
their account (e.g. Amazon Pay). For instance, Sony Pictures Television, which
produces many TV shows, including Jeopardy! and Who Wants to Be a Millionaire?,
has built a voice app portfolio that reaches millions of users every day. Jeopardy!
was the frst Alexa skill to ofer ISP. For a payment of $1.99 per month, users can
play more than one daily session and take part in previous episodes that they have
missed.
2 Managers can develop Voice Commerce skills or actions to sell directly to consumers
on their channel. For instance, Domino’s Pizza developed one of the early custom
skills for Amazon Alexa that directly involves a commercial transaction. With more
than 60% of orders now placed digitally, Domino’s predicts that a 100% digital
business is possible. To achieve such an ambitious goal, Domino’s created a voice
strategy to tackle every available voice channel, from smart speakers to smartwatches.
By saying ‘Alexa, ask Domino’s to feed me!’, users can build a new pizza order and
repurchase the most recent one or track each stage of the delivery process.
3 Marketers can convey and redirect prospects towards the standard shopping capa-
bilities that are ofered by the VA’s manufacturers. Native shopping channels, such
as Amazon Alexa and Google Shopping, are characterised by the ease of making
AI-based voice assistants 75
low-involvement purchases. Currently, 85% of voice purchases are for items below
$100 according to a report by Voicebot AI (see Further reading). As such, the
penetration of voice shopping features varies widely among product categories.
The majority of purchases (21%) are digital products, such as music or movies,
which do not require tactile evaluation (eMarketer, 2019 – see Further reading).
However, an increasing number of people are shopping for physical products, such
as household items (8%) and electronic parts (7%). Grocery shopping is particularly
expected to grow via strategic partnerships with retail chains. In the United States,
Alexa’s users can order many diferent items, such as household products and fresh
produce, from a local Whole Foods and receive delivery within two hours. Google
has partnered with Walmart on voice-enabled grocery shopping in the United
States and with Carrefour in France.
VOICE VOICE
TRADITIONAL TRADITIONAL
MARKETING COMMERCE
CHANNELS CHANNELS
Brand-focused Sales-focused
Custom shopping
Branded
skill and native
skill & action
VA's shopping skill
Audio ads
Audio search ads
for skill and
for products
content promotion
User-generated
Editorial and user-
content and social
generated content
cues
CONTENT CONTENT
INTERACTION MANAGEMENT
CAMPAIGN RELATIONSHIP SERVICE
Figure 7.1 Communication mix strategy for voice marketing and Voice Commerce.
Source: own elaboration.
are still in their infancy. The algorithm that ranks the information on VAs represents
a ‘black box’ (Voosen, 2017, p. 22) for managers who are unable to assess risks and an
opportunity in the area of discoverability. Consequently, Voice Search Optimisation is
underdeveloped, with only 3.8% of businesses ofering information in voice searches,
according to Uberall (see Further reading). Regarding paid media, audio advertising is
limited to a few options. Among these, Spotify suggests buying tickets for the closest con-
cert venue of the user’s favourite artist. Amazon launched its audio ads platform, which
allows advertisers to promote products on Amazon Music.
In summary, several common activities in traditional marketing and e-commerce, such
as in the areas of campaigning or CRM, have not yet found a respective voice format.
As Kris Zanuldin from Amazon states on Pymnts.com (see Further reading), ‘Alexa is
obviously based on technology, but customers do not view her as technology. She has a
AI-based voice assistants 79
personality; she is a friend [ . . . ] How do you integrate a friend into your commerce
experiences? Think about it from that perspective as opposed to thinking about voice as
a new piece of technology’. Within this continuous platform development, managers are
called to decide whether to proactively implement solutions (act) or wait for a richer pool
of best practices (react).
(a) Mono-Processing
Purchase
Optional Incremental
Low
Low High
Further reading
Adobe. (2019). ‘State of Voice Technology for Brands’: Industry Report Presentation. Available at: www.slide-
share.net/slideshow/embed_code/key/v76vHDbO0WLnWw
Dawar, N., and Bendle, N. (2018). ‘Marketing in the age of Alexa’. Harvard Business Review, 96(3), pp. 80–86.
Available at: https://hbr.org/2018/05/marketing-in-the-age-of-alexa (accessed 12 August 2020).
eMarketer. (2019). Which Select Activities Have US Smart Speaker Owners Done on Their Smart Speakers. Available
at: https://www.emarketer.com/chart/229112/which-select-activities-have-us-smart-speaker-owners-
done-on-their-smart-speakers-of-respondents-by-demographic-june-2019 (accessed 3 April 2019).
IBM Retail Index. (2020). COVID-19 Pandemic Accelerated Shift to E-Commerce By 5 Years, New Report
Says. Available at: https://techcrunch.com/2020/08/24/covid-19-pandemic-accelerated-shift-to-e-
commerce-by-5-years-new-report-says/ (accessed 24 August 2020).
McKinsey. (2020a). The Great Consumer Shift: Ten Charts that Show How US Shopping Behavior is Changing.
Available at: https://www.mckinsey.com/business-functions/marketing-and-sales/our-insights/the-
great-consumer-shift-ten-charts-that-show-how-us-shopping-behavior-is-changing (accessed 4 August
2020).
AI-based voice assistants 81
McKinsey. (2020b). Europe’s Digital Migration During COVID-19: Getting Past the Broad Trends and Averages.
Research summary available at: www.mckinsey.com/business-functions/mckinsey-digital/our-
insights/europes-digital-migration-during-covid-19-getting-past-the-broad-trends-and-averages.
(accessed 24 August 2020).
Muniz, K., and Morwitz, V. (2019). ‘Not-so Easy Listening: Roots and Repercussions of Auditory
Choice Difculty in Voice Commerce’. Available at SSRN. https://doi.org/10.2139/ssrn.3462714
Pymnts.com. (2020). Finding Voice Commerce’s ‘Hero’ Use Case. Video Interview available at: www.
pymnts.com/amazon-payments/2020/fnding-voice-commerce-hero-use-case/
RAIN. (2020). Starbucks: Leveraging Voice to Combat the Line. Available at: https://rain.agency/starbucks
(accessed 22 September 2020).
Uberall. (2020). Voice Search Readiness Report 2019. Industry research available at: https://m.uberall.com/
uberall-report-voice-search-readiness-uk-2019
Voicebot AI. (2020). Voice Shopping Consumer Adoption Report 2018. Industry research available at:
https://voicebot.ai/voice-shopping-report-2018/
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André, Q., Carmon, Z., Wertenbroch, K., Crum, A., Frank, D., Goldstein, W., Huber, J., Van Boven,
L., Weber, B., and Yang, H. (2018). ‘Consumer choice and autonomy in the age of artifcial intelli-
gence and Big Data’. Customer Needs and Solutions, 5(1–2), pp. 28–37. https://doi.org/10.1007/
s40547-017-0085-8
Araujo, T. (2018). ‘Living up to the chatbot hype: The infuence of anthropomorphic design cues and
communicative agency framing on conversational agent and company perceptions’. Computers in
Human Behavior, 85, pp. 183–189. https://doi.org/10.1016/j.chb.2018.03.051
Candrian, C., Scherer, A., and Algesheimer, R. (2020). The Efect of AI on Selective Belief Updating.
ACR North American Advances.
Colleoni, E., Rozza, A., and Arvidsson, A. (2014). ‘Echo chamber or public sphere? Predicting political
orientation and measuring political homophily in Twitter using Big Data’. Journal of Communication,
64(2), pp. 317–332. https://doi.org/10.1111/jcom.12084
Davenport, T., Guha, A., Grewal, D., and Bressgott, T. (2020). ‘How artifcial intelligence will change
the future of marketing’. Journal of the Academy of Marketing Science, 48(1), pp. 24–42. https://doi.
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De Bellis, E., and Johar, G. V. (2020). ‘Autonomous shopping systems: Identifying and overcoming barriers to
consumer adoption’. Journal of Retailing, 96(1), pp. 74–87. https://doi.org/10.1016/j.jretai.2019.12.004
Dellaert, B. G., Shu, S. B., Arentze, T. A., Baker, T., Diehl, K., Donkers, B., Fast, N. J., Häubl, G.,
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Section 3
Customer experience
and servicescapes
8 The role of social capital in
digitalised retail servicescape
Jussi Nyrhinen, Mika Skippari and Terhi-Anna Wilska
Introduction
Regardless of the rapid digitalisation of the retail trade and the fast growth of online
commerce (e-commerce), the majority (i.e. 88%) of all global retail of goods and services
was still bought from physical stores (i.e. ‘ofine’ or ‘brick-and-mortar’ stores) in places
such as high streets or malls before the COVID-19 pandemic (Statista, 2019 – see Fur-
ther reading). Pandemic’s preventing measures, such as quarantines, social distancing and
moving restrictions, have forced consumers to increasingly adopt digital channels and that
has further accelerated the digitalisation of retail trade. However, according to the blog
post by World Economic Forum, the consumers are already returning to physical stores
in China, where the COVID-19 outbreak has started to ease (see e.g. Zhou and Goh,
2020 – see Further reading). A similar development can be expected in the other parts of
the world when quarantines and other restrictions are removed because consumers still
have many reasons to visit physical stores. Among these reasons are social needs, such as
real-life human contacts with other customers and store personnel (Maruyama and Wu,
2014). These needs are linked to the demand for authenticity and human interaction in
a digitalised consumer society, which means that consumers also seek experiences rather
than solely focus on economic norms and pragmatic motives while shopping (see Novak,
Hofman, and Duhachek, 2003). Thus, retail stores are places for humans to interact and
gather (Pan and Zinkhan, 2006) as well as to examine products and to feel the shop’s
atmosphere (Piotrowicz and Cuthbertson, 2014).
The need for experiences provides retail stores an opportunity to be more than just a
channel of distribution (see Treadgold and Reynolds, 2016). These experiences are cre-
ated across digital and physical environments because consumers are increasingly shop-
ping across multiple channels at diferent stages of the purchase process, and diferent
channels serve diferent purposes (Dholakia et al., 2010). For instance, a consumer may
use a digital channel (i.e. online/mobile store) for information searching, a physical store
for viewing and examining the product, and return to a digital channel to make the
purchase (Kumar and Venkatesan, 2005). Hence, digitalisation of the retail trade has not
only created new types of retail businesses but also altered how ‘traditional’ retail services
are consumed and experienced; customers now interact with retail shops through a wide
spectrum of touchpoints over plethora of channels and media types (Lemon and Verhoef,
2016). Nevertheless, the role of social interaction has not lost its importance in digitalised
retail environment: only, its role as a determinant for customer experience has changed.
Therefore, there is a need for better understanding the standpoint of human factor in
DOI: 10.4324/9781003093909-11
86 J. Nyrhinen, M. Skippari and T.-A. Wilska
digital retailing and how customer experience is formed in a retail space comprising
multiple channels.
In this chapter, we aim to extend the understanding of the role of the social and
experiential factors in explaining customer experience in digitalised retail environment.
Firstly, we discuss how digitalisation has dispersed customer experience into ‘omnichan-
nel customer experience’ where customers utilise both digital and physical channels, in a
convergent manner and often simultaneously while interacting with brands. This process
of customer’s interaction with a brand, as well as customer’s responses and impressions
of it, is known as customer experience (Gentile, Spiller, and Noci, 2007). Secondly, we
draw on the concept of servicescape, which comprises both tangible and intangible fea-
tures which make up the service experience (Bitner, 1992, Tombs and McColl-Kennedy,
2003). Prior research on servicescape has mainly focused on digital and physical settings,
while research on how these two settings related to the social element of retail is still
rather scarce (Bolton et al., 2018). Finally, recognising that the servicescape consists of
physical, digital and social realms (Bolton et al., 2018), we explore the role of social capital
in determining the customer experience in digitalised retail servicescape. The theory of
social capital is applied here because it captures the interactions, social relationships and
social networks in terms of economic value (Bourdieu, 1980; Lin, 1999; Putnam, 2000;
Coleman, 1988). We contribute to the theory of customer experience by ofering an
integrated view of social capital and servicescapes that explains how interpersonal rela-
tionships and social networks are formed in retail stores that comprise digital and physical
channels.
Digital–physical servicescape
The dispersion of consumer behaviour between online and ofine store environments
has led scholars to re-examine the concept of servicescape (Bitner, 1992, Tombs and
McColl-Kennedy, 2003). The servicescape is initially defned as a setting for the cus-
tomer experience, a build environment that afects both consumers and employees in
service encounters (Bitner, 1992), such as store space. Later defnitions have acknowl-
edged human interactions between customers and service personnel as an integral part
of the servicescape (e.g. Johnstone, 2012; Rosenbaum and Massiah, 2011, pp. 474–480).
Regardless of the intangible nature of the digital servicescape, many sensory attributes
of the physical servicescape are metaphorically maintained when conceptualising digital
retail environments and virtual interactions (Ballantyne and Nilsson, 2017). For example,
a website’s design will afect the atmosphere of an e-store similar to how the interior
shapes the atmosphere of a physical store. Moreover, the customer experience in the
digitalised servicescape has become more social by nature because SM platforms have
increased customer-to-customer interactions (Lemon and Verhoef, 2016). Hence, cus-
tomers may share their experiences as well as become infuenced by peer customers dur-
ing a service encounter (Lemon and Verhoef, 2016; Libai et al., 2010). Besides the online
peer-culture, mobile technology has also brought peer culture into the physical channel.
Customers can now communicate about their service experiences with their social net-
works via portable devices in real time, in a physical store (Piotrowicz and Cuthbertson,
2014). Hereby, customer servicescape can be regarded as three-dimensional, consisting of
digital, physical and social realms (Bolton et al., 2018).
However, our understanding of the customer experience in the digital–physical ser-
vicescape is rather limited. Notably, the prior literature has focused on only one or two
realms (Bolton et al., 2018) at a time. Models that conceptualize customer experience
were initially developed separately for either the ofine context (e.g. Shilpa and Rajnish,
2013), the online context (e.g. Rose et al., 2012) or to measure and compare the efects of
individual channels separately (e.g. Wang, Jiang, and Chen, 2004). Understanding inter-
connections between digital, physical and social realms may help in creating sophisticated
service systems that beneft consumers, organisations and society (Bolton et al., 2018).
Therefore, better knowledge of how the three realms of the servicescape could converge
is needed to create a superior customer experience.
Customers’ participation afects the essence of the service encounter because ser-
vice experiences are co-created through interactions among customers and/or between
customers and a retailer. Moreover, social interaction is among one of the motives for
customers to visit retail stores (e.g. Skippari, Nyrhinen, and Karjaluoto, 2017). In addi-
tion, interpersonal relationships and social networks that are supported by digital and/or
physical servicescapes may provide retailers with a competitive advantage because they
are more difcult to replicate than product- or market-related factors. Although this
social nature of the servicescape is widely recognised (e.g. McColl-Kennedy et al., 2015;
Rosenbaum and Massiah, 2011), the research on how customers and service personnel
88 J. Nyrhinen, M. Skippari and T.-A. Wilska
create trust and reciprocal relationships through the physical, digital and social realms of
the servicescape is scarce. To understand how these social factors can be capitalised, the
concept of social capital is utilised to examine the servicescape.
Disclaimer
The research presented in this chapter was collected for my University of Jyväskylä Doc-
toral Dissertation Social Capital in the Digitised Servicescape (2020). The copyright for this
JYU thesis belongs to me, Jussi Nyrhinen, as the Author. Research presented here has not
been otherwise previously published.
Further reading
Abramovich, G. (2020). ‘Adobe digital economy index: Tracking the state of ecommerce during
COVID-19 and beyond’. Adobe Analytics blog, November 31, 2020. Available at: https://blog.adobe.
com/en/2020/03/31/adobe-digital-economy-index-tracking-the-state-of-ecommerce-during-
covid-19-and-beyond.html#gs.nkcinn (accessed 6 December 2020).
Seraphin, S. (2020). ‘Top 3 omnichannel strategies retailers are using during COVID-19’. Retail Info
Systems blog September 25, 2020. Available at: https://risnews.com/top-3-omnichannel-strategies-
retailers-are-using-during-covid-19 (accessed 6 December 2020).
Statista. (2019, August 30). E-commerce Share of Total Global Retail Sales from 2015 to 2023. Available at: www.
statista.com/statistics/534123/e-commerce-share-of-retail-sales-worldwide/ (accessed 3 September 2019).
Vujanic, A., and Burns, T. (2020, August 13). ‘COVID-19 Likely to Usher in “Decade of the Home,”
According to Accenture Survey Research’. Accenture Newsroom blog 13.8.2020. Available at:
https://newsroom.accenture.com/news/covid-19-likely-to-usher-in-decade-of-the-home-according-
to-accenture-survey-research.htm (accessed 23 August 2021).
Zhou, W., and Goh, B. (2020). ‘Chinese citizens are returning to shops as the COVID-19 outbreak
eases’. The World Economic Forum COVID Action Platform blog. Available at: www.weforum.org/
agenda/2020/03/chinas-coronavirus-outbreak-shops (accessed 6 December 2020).
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9 From places to platforms
Examining the transformation
of servicescapes
Julie Horáková and Outi Uusitalo
Introduction
Despite being one of the basic elements of the Marketing Mix and an important variable
in creating consumers’ shopping experiences, the importance and meanings of place as
a multidimensional entity are often overlooked. While the potential and worth of places
are acknowledged, emphasis on independence from both time and physical place that is
brought by the digital era has shifted the status of place towards a background variable
that merely complements the main product or service provided. Increasing attention
towards the digitalisation of shopping has shifted researchers’ focus towards the functions
and usability of interfaces, and the role of place as a multidimensional entity is often over-
looked. However, research shows that places can hold important meanings for consum-
ers, and they strongly contribute to the creation of customer value (Brocato, Baker, and
Voorhees, 2015; Johnson et al., 2015; Rosenbaum et al., 2020). Therefore, the notion of
retail place as a focal marketing issue is not likely to become irrelevant, even though digi-
tal technology increasingly mediates shopping and changes the shopping environment.
The DM literature has paved the way for the versatility of research of digitalisation
in the context of marketplaces (Dwivedi et al., 2020; Kannan and Li, 2017; Lamberton
and Stephen, 2016). While the research of online retailing is proliferating, many studies
have focused on the functionality of exchanges (Hagberg, Sundstrom, and Egels-Zandén,
2016). Few studies have tackled the notion of the transforming shopping environment
and the special features of online shopping locations as places. One reason may be that,
although online shopping and digital services have seen constant growth in recent years,
the disappearance of brick-and-mortar stores in the foreseeable future seemed unimagi-
nable. However, the COVID-19 pandemic that hit commerce worldwide has shown that
what seems unthinkable can become reality in a matter of days. Strict restrictions and
quarantine orders forced also the consumers preferring to shop in physical stores to switch
from ofine shopping to the online environment as retail shops and service premises were
closed. Given the importance and multidimensionality of place, there is a need for more
thorough research into online shopping places and their role in creating customer experi-
ence and value.
This chapter focuses on the changing nature of commercial places from physical shop-
ping locations to digital platforms. We provide a conceptual framework for understanding
the signifcance and meaning of digital places to consumers and apply empirical survey
data to illustrate the critical aspects on which marketers should focus when designing
online places that matter to create value for consumers’ everyday lives.
DOI: 10.4324/9781003093909-12
96 Julie Horáková and Outi Uusitalo
Conceptualisation of place in marketing
Although place is considered a foundation of marketing, the conceptualisation and deep
analysis of commercial places in marketing literature are incoherent. What the Marketing
Mix synthesises under the name ‘place’, which could evoke the notion of a static physi-
cal location, is a complex distribution channel that represents the fow of goods from the
producer to the fnal consumer to deliver customer value (Kotler et al., 2013). Research
felds, such as geography and environmental psychology, have allocated extensive atten-
tion to the conceptualisation of place. In one of the most infuential works on the topic,
Relph (1976) conceptualises place as a multidimensional concept consisting of three main
components: location, activities and meanings. He also emphasises the importance of
place both functionally and existentially. Tuan (1977) makes a distinction between place
and space. According to him, place embodies established values and represents concrete-
ness, stability and belonging. Thus, place may be regarded as safe and stable, whereas
space represents openness, change and abstractness and allows freedom and movement.
Space includes a social character; it produces social relations and social relations produce
space. However, this does not necessarily mean that physical places are always stationary
(Cresswell, 2004). For instance, sales booths and pop-up stores are examples of places the
location of which is constantly changing. As for online platforms as places, they tend to
conform to the defnition of space.
To distinguish between the important places in consumers’ lives such as home (frst
place) and work (second place), some authors (Oldenburg, 2001; Rosenbaum and Small-
wood, 2013) address commercial places as ‘third places’. They highlight the social nature
of a location and argue that these places act as informal settings of social life, and they
encourage formation of social relationships and networks between diferent actors in the
marketplace. Consumers often seek a social support in commercial places to escape isola-
tion and loneliness that they may experience in frst or second places (Rosenbaum and
Smallwood, 2013). Moreover, certain commercial places can provide restorative (Korpela
et al., 2001) and therapeutic benefts (Rosenbaum et al., 2020) and have, therefore, a
major impact on consumers’ well-being beyond the place.
Meanings of place
Meanings of place are created by the interaction of three components: environment, self
and others (Gustafson, 2001). Consumers actively create and shape these meanings based
on their personalities, social environments and lifestyle (Thompson and Arsel, 2004). Per
Gustafson (2001), places can also hold meanings that are not dependent on the self or oth-
ers but are rather constituted by a symbolic or historical context of the place. Researchers
focusing on commercial places (Brocato, Baker, and Voorhees, 2015; Kyle, Mowen, and
Tarrant, 2004) suggest that meanings are co-created and assigned to places when consum-
ers are engaging in various activities and social relationships within a place. Meanings are
then subjective and based on personal experiences and feelings with that place.
Relph (1976) indicates that activities that diferent actors engage in at a certain place
are a vital component of that place. Places have long been viewed as the main facility of
economic exchange (Bagozzi, 1975) that acts as a repository of potential resources for
diferent market players (Rosenbaum et al., 2020). However, in the contemporary mar-
ketplace, buyers and sellers are no longer isolated actors that engage in a simple buyer
and seller transaction. Digitalisation constantly changes the marketplace in multiple ways
From places to platforms 97
(Hagberg, Sundstrom, and Egels-Zandén, 2016). The roles are blending; boundaries are
blurring and the exchange of money, goods, services and information are resulting from
complex relationships between various actors in the marketplace. Consumers actively
participate in value creation as they engage socially and emotionally with place settings as
well as employees and other consumers (Debenedetti, Oppewal, and Arsel, 2013).
Place identity
Place identity represents the personal dimension of the attachment bond. It is an exten-
sion of one’s self-identity and encompasses feelings, emotions and experiences as well as
more abstract beliefs and symbolic connections that an individual has with a particular
place (Proshansky, Fabian, and Kaminof, 1983; Williams et al., 1992). For consumers to
identify with a place and establish a strong relationship, such as attachment, their self-
identity has to align with the place’s identity. Establishing this strong bond makes it part
of the individual’s concept of self and a way of self-identifcation (Brocato et al., 2015).
Place identity comprises cognitions of the sensory stimuli that we perceive at the place
and their accumulation in the form of memories and experiences with the place over
time (Proshansky, Fabian, and Kaminof, 1983). It is clear that physical evidence and dif-
ferent attributes of a place have a signifcant impact on the formation of place identity in
consumers’ minds. In the digital environment, sensory stimuli are limited because con-
sumers are perceiving the atmospherics of the place through a digital medium instead of
having a rich real-life experience. Nevertheless, new types of online places for shopping
and consumption combining both material and imaginary elements have been launched
(Hagberg, Sundstrom, and Egels-Zandén, 2016).
Place dependence
Place dependence is an integral part of attachment. It refers to how a place fulfls its
function compared to other available places (Williams et al., 1992), and it is considered
a functional dimension of the attachment bond (Brocato et al., 2015). In physical set-
tings, consumers are constrained by spatial and time boundaries and limited options. It
is not physically possible to visit ten diferent stores that are located in diferent parts of
a town within a short period. However, the digital environment allows consumers to
overcome these boundaries; a few clicks enable the browsing of diferent stores world-
wide. Place dependence is essentially a functional element, and it has usually been the
major focus of designing online stores as well as multichannel and omnichannel retail
concepts.
Social bonds
Places act as facilitators of social relationships between diferent marketplace actors ( John-
son et al., 2015). These relationships can evolve between consumers and employees as
100 Julie Horáková and Outi Uusitalo
well as among other consumers (Brocato et al., 2015). The social aspects of a place play
a major role in establishing a strong relationship with the place. Moreover, they have
positive benefts for consumers’ well-being (Rosenbaum et al., 2020). Digitalisation trans-
forms the social bonds through incorporating digital technologies in the interactions
between retailers and customers as well as that among customers (Hagberg, Sundstrom,
and Egels-Zandén, 2016). Face-to-face social interaction is replaced by parasocial rela-
tionships (Giles, 2002; Horton and Wohl, 1956). Interaction between diferent actors is
mediated by a digital platform, where users are interacting with either the digital repre-
sentation of other humans or AI in the form of a chatbot, which is often represented by
an anthropomorphised avatar.
Empirical illustration
To illustrate the theoretical discussion and insights, we present fndings from an empirical
study among four Finnish retail stores. These retailers operate in the design and home
décor market; therefore, their stores have atmospheres that will likely arouse consumers’
emotions and feelings, which in the long term can develop into a strong relational bond,
such as place attachment. Moreover, all four retailers provide a multichannel setting as
they operate in both ofine and online environments.
Findings
We performed an independent sample t-test with store type (ofine/online) as the inde-
pendent variable. The dependent variable was place attachment, which was calculated
as a mean of the three distinct dimensions: place identity, place dependence and social bonds.
The results in Table 9.1 show no statistically signifcant diferences in the strength of
place attachment bond between the ofine and online shopping environments. The
results imply that consumers can establish an attachment to a place in brick and mor-
tar stores and to a digital space in the online environment. This fnding represents an
important advancement in the understanding of the transformation of shopping places.
Despite drastic changes in the retail environment, retail places can maintain the ability to
arouse emotional responses and bonds between commercial places and consumers. The
From places to platforms 101
Table 9.1 Mean comparison for diferent shopping environments
accumulation of such responses and experiences over time results in creating a strong
emotional bond with the place, regardless of its dematerialised character.
To gain deeper understanding of how the place attachment bond is formed in online
environment, we have examined the diferences in the distinct dimensions separately.
We again performed an independent sample t-test, with independent variable being the
type of the store (ofine/online) and distinct place attachment dimensions as dependent
variables. Place identity and place dependence were each measured with a scale of three items
adapted from Johnson et al. (2015); social bonds were measured with a fve-item scale
adapted from Hsieh, Chiu, and Chiang (2005). The dependent variables were obtained
by calculating a mean for each dimension. As shown in Table 9.1, the only place attach-
ment dimension that seems to signifcantly difer in ofine and online environments is
place dependence. Place dependence is signifcantly lower in the online environment than in
the ofine environment. As discussed earlier, in the physical environment, consumers
face spatial and timely constraints that limit how many stores they can visit, while digital
platforms and online stores overcome these boundaries. They signifcantly increase in the
number of options that consumers have and enable browsing in multiple stores with only
a few mouse clicks.
Unlike the functional dimension of place attachment, the personal and social dimen-
sions do not seem to difer in these two environments. Despite the increased intangibility
and the limited number of physical attributes of online stores, consumers can perceive and
identify with the identity of a place in the online environment. This fnding has important
implications for retailers who are operating in online channels. In the traditional physical
retail environment, place attachment has shown a positive impact on consumers’ loyalty
( Johnson et al., 2015), the absence of switching intentions and the spreading of positive
WOM (Brocato, Baker, and Voorhees, 2015). It is, therefore, crucial to conceptualise the
atmospherics and important attributes of online stores and examine how consumers form
their relationship with online place. This allows retailers to construct their online stores
to increase consumers’ place attachment and loyalty.
Interestingly, consumers seem to perceive the importance of social aspects and inter-
actions that online stores and digital platforms ofer equally with physical places. Digi-
talisation transforms the interface between retailers and consumers and also afects the
communication channels and brings new channels such as SM. In the online environ-
ment, a form of parasocial relationships replaces face-to-face relationships between con-
sumers and employees as well as between other consumers. Moreover, novel forms of
102 Julie Horáková and Outi Uusitalo
social relations arise with the emergence of AI technology as consumers interact with an
AI-driven chatbot instead of a human being.
Conclusion
In this chapter, we reviewed the theoretical grounds of commercial places and consumers’
attachment to these places. By refecting on the transformation of the retail servicescape
from the physicality of brick and mortar stores towards dematerialised intangible digital
platforms and online spaces, we have provided an account of the transition from physical
places to digital platforms. We connected our theoretical insights with an empirical study
that focused on consumers’ attachment to ofine as well as online places. Our results sug-
gest that consumers establish strong emotional bonds, such as attachment, not only with
physical places but also with online places that can only be accessed virtually and do not
possess the physical attributes of traditional store atmospherics.
This conceptual paper provides a valid ground for future research on online places and
digital platforms. We suggest that future research continues seeking deeper understanding
of consumers’ relationships to commercial places. The three dimensions of place attach-
ment, that is, place dependence, place identity and social bonds, seem to characterise how
consumers form bond with places. Place attachment is one important factor in ensur-
ing customer loyalty and positive word of mouth communication. Future studies should
more thoroughly investigate the forms of social relations that are associated with digital
platforms and online places, how consumers establish these novel forms of relationship
and how they afect consumers’ emotions and their attachment to retail stores.
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10 Social media and
consumer power
Opportunities and challenges
for digital marketing activities
Agostino Vollero and Chiara Valentini
Introduction
Social Media (SM) have progressively transformed interactions between twenty-frst cen-
tury consumers and companies and among consumers. Several technology-driven fac-
tors, such as the proliferation of digital platforms and online consumer-generated content
combined with increased media audience fragmentation (Papacharissi, 2002; Valentini,
Romenti and Kruckeberg, 2016), have challenged assumptions, practices and strategies
in traditional marketing management models. These are generally company-centric and
often consider consumers as marketing targets.
The rapid difusion of diferent SM worldwide (e.g. in January 2020, 3.8 billion people
were active SM users [We Are Social/Hootsuite, 2020 – see Further reading]) has created
additional opportunities for organisations to reach larger and more diversifed groups. It
has also pushed marketing and communication managers to reconsider their activities
regarding SM’s main characteristics, including possible innovative uses and the diverse
interests developed by consumers.
However, SM marketing research is still fragmented (Felix, Rauschnabel, and Hinsch,
2017), and the philosophical underpinnings in most marketing literature consider SM
one of several tools for marketing communication. Thus, the research focuses primarily
on specifc push-content tactics. This has led some practitioners to either overestimate
SM infuence, which is often considered a panacea to acquire and engage (new) consum-
ers or consider an organisation’s SM presence to be a promotional façade with little or
no marketing return.
However, noting the complexities of certain user participation patterns on SM, some
authors (e.g. Schultz and Peltier, 2013; Yadav and Pavlou, 2014) have proposed recon-
ceptualising the understanding and function of SM from a marketing perspective. The
literature acknowledges that consumers have increased their infuence towards organisa-
tions and brands by generating highly sharable content (e.g. comments and reviews)
with a global reach that impacts the opinions and behaviours of thousands of consumers.
This generation of consumers is thus becoming empowered (Denegri-Knott, Zwick, and
Schroeder, 2006) and continuously growing.
The infuence of those empowered consumers could potentially afect brand evalua-
tion by other consumers who tend to trust those perceived as peers more than compa-
nies. These empowered consumers can modify the perceived nature and structure of a
brand via their SM activities (Anker et al., 2015; Van Noort and Willemsen, 2012). For
marketers, engaging and retaining information-savvy consumers have become more dif-
fcult (Kitchen, 2005). However, organisations can exploit their SM interactions with
DOI: 10.4324/9781003093909-13
106 Agostino Vollero and Chiara Valentini
consumers in a way that positively impacts their consumer–brand relationships. Con-
sumer participation and collaboration through SM have resulted, for example, in co-
created product development (Firefox, Lego, Danone Activia) (Ind, Iglesias, and Schultz,
2013; Muniz and Schau, 2011; Pitt et al., 2006).
In this chapter, consumer empowerment via SM (Kucuk and Krishnamurthy, 2007;
Labrecque et al., 2013; Pires, Stanton, and Rita, 2006; Pitt et al., 2002; Vollero, Schultz,
and Siano, 2019) is seen as a main driver of a paradigm shift in Digital Mrketing (DM). This
chapter aims to embrace the emergent DM perspective of SM as a symbolic interactionism
phenomenon. SM is not merely a marketing tool; rather, it is a space to symbolically re-
discuss interaction dynamics and power relations among consumers and organisations and
a way to understand user interaction behaviours in these digital environments, including
how such behaviours may impact organisational marketing and communication activities.
Drawing from literature on consumer empowerment in digital environments (Denegri-
Knott, Zwick, and Schroeder, 2006; Labrecque et al., 2013; Siano, Vollero, and Palazzo,
2011), this chapter explores the SM-driven empowerment of consumers as a pervasive
process that enables consumers to increase control of the marketplace and potentially
overturn the traditional power imbalance between organisations and consumers.
The chapter is structured as follows. The next section provides the conceptual back-
ground for understanding SM’s impact on marketing activities, followed by the needs,
motivations and communicative behaviours of consumers in SM and a discussion on
consumer power in SM. This is further deepened by the analysis of a model of value co-
creation in SM based on consumer empowerment. Opportunities and challenges in SM
marketing research are then presented, followed by concluding remarks.
1 Information-based power enables consumers to freely and quickly access several online
information sources to enhance their consumption and buying behaviours. The
ease of access to service/product information on SM by other users reduces tradi-
tional information asymmetry and increases individual infuence on markets (Val-
entini and Kruckeberg, 2012).
2 Participation-based power enables consumers to make personal choices about their
participation in SM and create brand-related content. This power, which is derived
from content creation and dissemination (i.e. sharing), completion (e.g. comment-
ing, tagging) or modifcations (e.g. meme) (Labrecque et al., 2013), creates infu-
encers and forms a network of power.
3 Community-based power co-creates meaningful content that exerts signifcant control
over marketing activities, such as promoting new products/services, with like-minded
consumers or companies. Community-based power creates more buying power for
groups/communities and enables crowdfunding projects and sharing economy
platforms.
These forms of power have progressively increased with the use/spread of SM. Thus,
organisations can no longer merely create and distribute content for (potential) consum-
ers (O’Brien, 2011); they must move towards multi-layered interactions across diferent
SM (Quinton, 2013; Singaraju et al., 2016) with a mix of user-generated and company-
generated content.
Diverse consumer behaviours on SM afect how organisations can strategically use SM.
They must understand the directions that brand or company-related communications can
take, including multi-vocality and multiple voices, which often confict and contrast with
what appears in the SM ecosystem. Organisations must acknowledge and exploit these
richer interactions among consumers and among other members of the public (Sawhney,
Verona, and Prandelli, 2005). They must also accept that a relationship can now be initiated
and controlled by consumers without the company’s consent and be able to manage mul-
tiple brand touchpoints, which are interconnected in the SM environment and controlled
by both frms and consumers (Vollero, Schultz, and Siano, 2019). Managing this complex
scenario requires a diferent approach to DM – one that we argue should implement strate-
gic SM listening via various tools, such as big data analytics and SM engagement.
SOCIAL MEDIA
Resource integration and exchange
through mediations and negotiations
Organisation VALUE
Empowered
value sphere CO-CREATION customer
value sphere
Conclusions
SM, its popularity and its wide reach have changed how people interact, socialise and
consume digital content. This chapter outlined the main characteristics of and changes
brought about by SM that directly impact DM. Along with other scholars, we argue that
SM empower consumers in ways that challenge the power dynamics and information
asymmetry of traditional marketing communication. However, SM also act as ‘systems
resource integrators in the interaction between frms and customers’ (Singaraju et al.,
2016, p. 45). This has caused a shift from a functionalistic view of SM as another mar-
keting communication channel to a (social) interactionist view, where SM are the loci of
conversations and interactions among SM users, which generate both value-in-context
and value-in-use for a company.
Accordingly, marketers and communication professionals require new skills and knowl-
edge, including negotiating, listening and mediating, combined with a more integrated
use of user data and long-term strategic goals to measure SM engagement and the value
that consumers and organisations can obtain from interacting with one another. The
participative and social connectivity nature of SM ofers both opportunities and chal-
lenges for DM, which call for further research and empirical validation by the academic
community.
Further reading
We Are Social/Hootsuite. (2020). Digital Report 2020. Available at: https://wearesocial.com/global-
digital-report-2020 (accessed 10 December 2020).
Woodall, G., and Colby, C. (2011). ‘The results are in: Social media techniques vs. focus groups for
qualitative research’. MRA’s Alert (pp. 23–27). Available at: https://rockresearch.com/the-results-are-
in-social-media-techniques-vs-focus-groups-for-qualitative-research/ (accessed 10 December 2020).
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Section 4
Introduction
Issues relating to ethics and corporate social responsibility are becoming increasingly
important for determining retailer performance (Ganesh et al., 2010) and consumer
behaviour (Vitell, 2003) in both ofine and online retail settings. Retailers use various
strategies to address their ethical practices, which can help them establish and maintain
long-term relationships with their customers (Roman and Ruiz, 2005). Consumers are
increasingly aware of and concerned about retail ethical issues, such as deceptive practices
of retailers (e.g. the exaggeration of product qualities and using aggressive and manipu-
lative selling tactics) and the safety of transactions (e.g. privacy policies and warranties)
(Miyazaki and Fernandez, 2001; Roman, 2010).
Earlier research on consumer ethics in the retail context has largely focused on explor-
ing how consumers perceive retailers’ ethical behaviours or actions and how these per-
ceptions afect consumers’ behavioural intentions (see Limbu, Wolf, and Lunsford, 2012).
Most of this research has been conducted in the traditional retailing context. Due to the
recent growth of online retailing, many scholars have begun investigating consumers’
perceptions regarding online retailing (Limbu, Wolf, and Lunsford, 2011, 2012; Roman,
2007, 2010; Roman and Cuestas, 2008). It is largely acknowledged that ethical issues
in online retailing are diferent from the ethics of traditional brick-and-mortar retailing
(Limbu et al., 2012). Moreover, ethical issues have emerged as one of the most critical
challenges to online shopping; it is vital for online retailers to engage with their consum-
ers in a secure, confdential, fair and honest manner that ultimately protects consumers’
interests (Limbu et al., 2011).
Many early contributions to consumer ethics in online retailing were conceptual and
had a limited focus on consumers’ privacy and security issues (Roman, 2007). More
recently, related empirical research has been increasing (Adam, Aderet, and Sadeh, 2007;
Limbu et al., 2011, 2012; Lu, Chang, and Yu, 2013; Roman, 2007; Roman and Cuestas,
2008; Yang et al., 2009). However, this research has largely focused on investigating the
views of online shoppers; few studies have examined the ethical perceptions of consumers
using diferent marketing channels.
Contemporary consumers are increasingly using multiple channels when making pur-
chases, and it has been suggested that those who shop online behave in fundamentally
diferent ways compared to traditional retail shoppers (e.g. Rohm and Swaminathan,
2004; Srinivasan, Anderson, and Ponnavolu, 2002). As noted by Ganesh et al. (2010),
we need more empirical consumer research based on responses from shoppers who shop
in traditional and online formats. Therefore, in the increasingly important multichannel
DOI: 10.4324/9781003093909-15
120 M. Skippari, S. Kajalo and A. Lindblom
environment, it is essential to understand consumer considerations regarding retailer eth-
ics in various marketing channels.
In this chapter, we draw on previous research on retailing ethics and consumers’ chan-
nel selection to examine how consumers’ perceptions of online retailer ethics vary among
consumers using diferent purchasing channels. We utilise Roman’s (2007) framework for
analysing Consumers’ Perceptions regarding the Ethics of Online Retailers (CPEOR),
which includes the dimensions of security, privacy, non-deception and fulflment. With
this framework, our aim is two-fold. We frstly investigate the importance of ethics of
online retailers on channel selection among consumers by examining how consumer
views about online retailing ethics difer between traditional, online and multichannel
shoppers. Secondly, we examine how consumers’ patronage frequency afects their views
about the importance of online retailing ethics.
Methodology
This study focuses on consumers’ attitudes towards and ethical perceptions of online
retailing. We collected data on such attitudes by surveying Finnish consumers. To gather
the necessary data, we collaborated with a department store chain that sent email requests
to their loyalty programme customers to take part in an online survey. To capture con-
sumer views across diferent channels, we sent the survey to traditional shoppers, online
shoppers and multichannel shoppers. In total, 1,000 emails were sent to customers who
had bought only from a brick-and-mortar department store (traditional shoppers), 1,000
were sent to those who had bought only from the webstore (online shoppers) and 1,000
were sent to those who had bought from both channels (multichannel shoppers). Only
customers who had made a purchase during the last three months were accepted in the
sample.
We received usable responses from 684 respondents: 216 traditional shoppers (21.60%),
224 online shoppers (22.40%) and 244 multichannel shoppers (24.40%) (Table 11.1).
Table 11.1 shows that the majority of respondents in all three groups are female.
This refects the target of our study, which was a department store chain. Among
The importance of online retailers’ ethics 123
Table 11.1 Demographic respondents’ characteristics
Gender
Female 78.1 66.5 84.5 76.6
Male 21.9 33.5 15.5 23.4
Age
<19 0.5 0.9 0.4 0.6
19–29 7.0 9.1 16.3 11.0
30–39 13.6 19.5 29.3 21.1
40–49 28.0 27.3 28.0 27.8
50–59 29.9 25.9 19.7 25.0
60 or older 21.0 17.3 6.3 14.6
Household monthly income in euros
<1,000 6.4 8.8 5.1 6.7
1,000–1,999 12.3 20.5 15.4 16.1
2,000–2,999 25.1 16.7 22.2 21.3
3,000–3,999 13.8 23.3 18.8 18.7
4,000–5,999 28.6 20.5 26.1 25.0
6,000–7,999 7.9 6.5 7.3 7.2
8,000 or more 5.9 3.7 5.1 4.9
How many times have you ordered products from web stores during the last three
months?
0 24.9 1.4 0.4 8.4
1–3 57.7 42.3 40.5 46.5
4–6 13.1 34.5 41.7 30.4
7 or more 4.2 21.8 17.4 14.7
How frequently do you use the Internet?
Daily 86.4 94.1 90.1 90.2
Several times a week 12.7 4.1 8.7 8.4
Once a week 0.9 0.5 1.2 0.9
Once a month 0.0 1.4 0.0 0.4
online shoppers, there are more men than in the other groups. Regarding age dis-
tribution, online shoppers and multichannel shoppers tend to be younger than tra-
ditional shoppers. There is no signifcant diference in income level between the
shopper types.
As expected, the number of online purchases from any web store in the last three
months is signifcantly higher among online and multichannel shoppers. Table 11.1 also
shows that all three groups are active Internet users; even among the traditional shoppers,
86.4% use the Internet daily. These fndings suggest that the traditional shopper group
might shop online. Thus, their responses are likely to refect the reasons why people
might not become online or multichannel shoppers.
Overall, Table 11.1 supports our results regarding department store customers, and the
data provide possibilities to investigate the diferences between the three studied groups
of shoppers.
124 M. Skippari, S. Kajalo and A. Lindblom
Results
We frstly investigated how channel selection is related to customers’ views regarding
online retailer ethics. We used Roman’s (2007) four-dimensional scale (security, privacy,
non-deception and fulflment/reliability) to capture the consumers’ perceptions regarding
online retailer ethics. We then used a one-way ANOVA test to examine the relationships.
Table 11.2 shows how traditional shoppers, online shoppers and multichannel shoppers
difer in their views towards the ethics of online retailing.
Table 11.2 The importance of online retailers’ ethics by retail patronage behaviour: one-way ANOVA
(n = 684)
Security
The security policy is easy to 4.72 6.00 6.10 5.94 .01*
understand.
The site displays the terms 5.95 6.33 6.37 6.22 .00**
and conditions of the online
transaction before the purchase
has taken place.
The site appears to ofer secure 6.02 6.37 6.43 6.28 .00**
payment methods.
This site has adequate security 5.84 6.14 6.32 6.11 .00**
features.
Privacy
The site clearly explains how user 5.81 6.21 6.14 6.06 .01**
information is used.
Only the personal information 5.92 6.19 6.26 6.13 .01*
necessary for the transaction to be
completed needs to be provided.
Information regarding the privacy 5.95 6.15 6.19 6.10 .14
policy is clearly presented.
Non-deception
The site exaggerates the benefts 5.79 5.97 6.03 5.93 .16
and characteristics of its oferings.
This site takes advantage of less 5.77 6.02 6.12 5.98 .03*
experienced consumers to make
them purchase.
This site attempts to persuade 5.51 5.91 5.84 5.76 .02*
you to buy things that you do not
need.
Fulflment/reliability
The price shown on the site is the 6.17 6.54 6.52 6.42 .00**
actual amount billed.
You get what you ordered from 6.12 6.55 6.52 6.40 .00**
this site.
Promises to do something by a 6.05 6.38 6.39 6.28 .01**
certain time are kept.
Note: All items were measured from 1 (not important at all) to 7 (very important). *Signifcant at p < .05 level;
**
signifcant at p < .01 level.
The importance of online retailers’ ethics 125
The results in Table 11.2 demonstrate that there are signifcant diferences among the
views that traditional, online and multichannel shoppers have on the ethical aspects of
online retailing.
1 Online shoppers and especially multichannel shoppers value the security issues of
online retailing much more highly than shoppers who only use physical stores.
2 Online and multichannel shoppers consider two of the privacy items more impor-
tant, but the third item has no statistically signifcant diference between the groups.
3 In non-deception, two items are considered more important among online and
multichannel shoppers, whereas exaggeration of the benefts and characteristics of
the online store’s oferings are equally perceived among the shopper groups.
4 Among the fulflment/reliability items, all items are statistically signifcantly more
important to online and multichannel shoppers.
Overall, the results demonstrate that, for online shoppers and multichannel shoppers, the
ethics of online retailing are more important than they are for traditional shoppers.
Next, we examined how consumers’ perceptions regarding online retailers’ ethics
are linked to their shopping behaviour. In particular, we looked at the interconnection
between consumers’ online purchasing frequency and their ethical considerations towards
the online retailer. The frequency of online shopping was measured by the number of
online purchases during the last three months.
Table 11.3 shows that the ethics of online retailers are more important for consum-
ers who have made the most purchases during the past three months. This fnding may
Table 11.3 The importance of online retailers’ ethics by number of online purchases during the last three
months: one-way ANOVA ( n = 675).
Security
The security policy is easy to 4.96 5.97 6.06 6.26 5.95 .00*
understand.
The site displays the terms 5.28 6.25 6.37 6.43 6.23 .00**
and conditions of the online
transaction before the purchase
has taken place.
The site appears to ofer secure 5.33 6.26 6.44 6.62 6.29 .00**
payment methods.
The site has adequate security 5.14 6.10 6.30 6.36 6.12 .00**
features.
Privacy
The site clearly explains how user 5.51 6.08 6.08 6.33 6.07 .00**
information is used.
Only the personal information 5.47 6.19 6.17 6.28 6.14 .00**
necessary for the transaction to be
completed needs to be provided.
Information regarding the privacy 5.38 6.17 6.17 6.22 6.11 .00**
policy is clearly presented.
(Continued )
126 M. Skippari, S. Kajalo and A. Lindblom
Table 11.3 (Continued)
suggest that those consumers who more frequently engage in online shopping are more
aware of the diferent aspects of online retailers’ ethics. There are also no diferences
between ethics scales, implying that security, privacy, non-deception and fulflment are
all equally important for frequent online shoppers.
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12 Data obstacles and privacy
concerns in artifcial
intelligence initiatives
Bilal Aslam, Heikki Karjaluoto and Eevi Varmavuo
Introduction
Artifcial Intelligence (AI) is considered a revolutionary technology in the marketing
industry. Although it has existed as a technology and a feld of study for decades, it has
only recently shown rapid growth among diferent markets. AI has disrupted a variety of
industries (Campbell et al., 2020), and the growth of AI adoption and its positive efects
on businesses are clear; estimations predict that AI will increase the global economy
by 14% (equivalent to 15.7 trillion USD) by 2030 (see Future Reading: Al Sheibani,
Cheung, and Messon, 2018). By investing in AI, frms may increase their return on
investment signifcantly, which will further accelerate AI adoption.
One factor that infuences AI is data, which are the raw materials that are required
to run AI machinery. Data serve as a new source of idea generation for product devel-
opment, customer service, shelf location, distribution, dynamic pricing, etc. (Erevelles,
Fukawa, and Swayne, 2016). Good data are the foundation of AI modelling, and the
appropriate data are needed to optimise projects (eMarketer, 2019 – see Further reading).
During the past few years, the use of data sciences, which facilitate decision-making and
the extraction of actionable insights and knowledge from large datasets in the marketing
environment, has remarkably increased. Despite these advances, strategies for improving
the management of data sciences in DM remain scarce (Saura, 2020). AI both lives and
dies by data; problematic data can introduce risks that can be economically devastating for
any company (Harrison et al., 2019)
Therefore, we must explore whether companies are preparing themselves in terms
of data collection and management to fully capitalise on AI technology. Specifcally,
businesses reportedly waste considerable time organising, cleaning and structuring the
databases of their users and customers (Kelleher and Tierney, 2018). There are problems
in data acquisition, data labelling and the improvement of existing data (Roh, Heo,
and Whang, 2019). It is important to determine whether companies have organisa-
tional chassis to successfully support AI initiatives. A strong dimension of data that is
often ignored is ethical issues related to data privacy. For example, the two tech giants
Google and Facebook were both sued for submitting consumers’ photos for biometric
scanning (Solove and Schwartz, 2014). This development might afect data-driven AI
initiatives, especially since the implementation of the General Data Protection Regula-
tion (GDPR) in Europe. Data privacy can also create problems because customers are
becoming more aware of the collection of their personal data, and it is raising concerns
(Davenport et al., 2020).
DOI: 10.4324/9781003093909-16
Data obstacles, privacy and AI 131
This chapter aims to determine whether frms have sound structures for collecting and
organising data to fully harness AI technology. We used a special data privacy angle to
monitor the industry’s current outlook regarding data privacy issues. For this purpose, we
conducted in-depth interviews with relevant AI and data industry experts in fve coun-
tries. The results showed that companies are currently lacking in structures and systems
for collecting and managing data; thus, their ability to harness AI technology is weak. It
was also evident that data privacy issues are extremely important, and measures like the
GDPR will help the industry cultivate a more ethical use of technology while not block-
ing overall industry growth. Our study will assist managers who want to capitalise on data
based on AI technology.
Literature review
The concept of AI in its contemporary sense is not new. It was frstly initiated during the
Dartmouth Summer Research Project on AI in the 1950s. However, AI appears new to
those looking to repackage Big Data (Elish and Boyd, 2017). Marketers can now gener-
ate more accurate results for a variety of marketing intelligence tasks, including customer
segmentation and profling, product reputation management, pricing strategy, competitor
analysis, promotional marketing analysis, recommender systems, location-based advertis-
ing and community dynamic analysis (Fana et al., 2015). These results have important
implications for forecasting purchases, and they can afect sales forecasting (Liu, Xiao,
and Ding, 2016). AI and Big Data are not only changing existing marketing tasks but
also supporting innovative marketing solutions. For example, Liu, Xiao, and Ding (2016)
propose an automated and scalable garment recommender system using real-time in-store
videos that can improve the experiences of garment shoppers and increase product sales.
Data are the foundation of AI-driven marketing; AI requires data to run, and most
AI-powered solutions require existing datasets to run. If a project lacks the appropriate
data, the results will be less than optimal (eMarketer, 2019 – see Further reading). AI
makes data meaningful through cognitive computing because analysis of data by humans
can be a time-consuming task; thus, the utilisation of AI techniques helps clarify data
(Gupta et al., 2018). More data are available today than ever before but companies can-
not generate efective results if their data are compromised (Alshura, Zabadi, and Abug-
hazaleh, 2018). Data ofer greater insights into marketing performance than they did in
the past, and these insights help marketers make successful decisions for optimising their
marketing actions and improving their return on investment (Wedel and Kannan, 2016).
While fnding data used to be a challenge for marketers, they now face the challenge of
transforming data into value. Data have attained a central role in marketing solutions. As
data become larger, more complex and more inexplicable, the limited mental capacities
of humans pose diffculties in deciphering and interpreting an unknown environment
(Sammut and Sartawi, 2012). Data create a competitive advantage, and marketers are
creating more personalised experiences through data (Wright et al., 2019; Ozcelik and
Varnali, 2019; Jarek and Mazurek, 2019; Aguirre et al., 2015). Companies should be using
an infrastructure that can facilitate the adoption of AI, and this particular area of research
needs further examination.
Data-based innovation and marketing can trigger consumers’ privacy concerns from
a contextual integrity perspective. Such concerns can, in turn, infuence the future of
these data-intensive felds. Firms must carefully evaluate their use of consumer data in
132 B. Aslam, H. Karjaluoto and E. Varmavuo
their innovation and marketing eforts (Bleier, Goldfarb, and Tucker, 2020; Daven-
port et al., 2020). Addressing data ethics and politics is an integral task of data stud-
ies. Big Data and their meaning are socially constructed and infuenced by evolving
social, political and technological forces (Chen and Haase, 2020). Martin, Borah, and
Palmatier (2017) state that growing eforts towards data collection and usage increase
customers’ concerns about their privacy. They might feel uncomfortable receiving per-
sonalised advertising and content when they realise how much of their data are being
collected and analysed (Aguirre et al., 2015). Per Martin and Murphy (2017), the more
worried customers are about their data privacy, the more negative their responses are
towards the brand. In addition, regulations, such as the GDPR, are considered revolu-
tionary in terms of data privacy, but they create challenges for marketers (Kietzmann,
Paschen, and Treen, 2018).
Research methodology
To reach a holistic understanding of what data issues challenge marketers, managers
and other industry executives, semi-structured interviews were used for data collection
in this research. The interviewed experts were working with AI technology and had
knowledge of and/or experience in marketing. Given the complexity of the research
problem and that the phenomenon under study may vary between the interviewees
depending on their expertise, it was important to consider that new information could
emerge during the interviews. This study used purposive sampling. A review of the
interviewees’ titles shows that they varied in their level of expertise. We conducted in
depth-interviews (see Table 12.1 for details) with 14 relevant managers, CEOs, entre-
preneurs and consultants.
We conducted telephonic interviews with the informants from Finland, the United
Kingdom, the United States, Switzerland and Peru to ensure balanced and comprehen-
sive results. Most of the interviews were conducted in Finland. The interviewees were
selected because of their knowledge/practice/experience, particularly in the AI feld and
generally for their ability to refect from marketing perspectives. The interviews, which
lasted ~45–60 minutes, were recorded and transcribed.
Our data analysis was conducted via thematic analysis (the ethnographic imagination
approach). Ethnography is a way to imagine ‘social’. In other words, ethnography is
a type of qualitative research that involves immersing yourself in a particular commu-
nity or organisation to observe their behaviour and interactions up close. Per Watson
(2011), organisational ethnography involves creating systematic generalisations about a
topic that must be theoretically informed, informing and contributing to the broader
body of knowledge that constitutes organisation and management studies. This approach
enables theoretical rather than empirical generalisations. Sociological imagination allows
individuals to rise above their everyday social context, making it possible to acquire the
distance necessary for critical refection and change (Mills, 1959).
The thematic analysis included fve steps. (1) Braun and Clark (2006) stress that the
researcher should familiarise themselves with the data. When transcribing the interviews
for this study, strict attention to detail ensured that no information of value was over-
looked. The interview recordings were frstly transcribed in writing, and fller words (e.g.
so, um and like) were left out. Both the interviews and the transcriptions were conducted
in English. (2) The second step included generating initial codes. Coding is defned as
‘the process of assigning meaningful numerical values or names that reduce data from a
Data obstacles, privacy and AI 133
Table 12.1 Interview participant details
large amount of undiferentiated text’ (Hair et al., 2015, p. 302). Thus, coding helps the
researcher focus on valuable key characteristics of the data. During this step, the entire
dataset was read and coded with precision. (3) The third step involved searching for
themes within the data (Braun and Clarke, 2006). Similar codes were put together in
potential themes; the codes that demonstrated patterns throughout the dataset were con-
sidered themes. The themes were then colour coded to help analyse the data. Braun and
Clarke (2006) suggest (4) reviewing the themes and (5) naming them. Here, the themes
were reviewed against emerging similar themes to avoid duplicates, and they were named
to provide a clear visual map of the data.
Findings
Figure 12.1 outlines the framework for factors afecting the successful implementation of
AI and required actions.
The analysis consists of themes that emerged from the semi-structured interviews
regarding data issues. Most of the interviewees stressed that the current data collection
and management methods that are used in most organisations are insufcient.
The biggest issue with AI is the data quality and the storing of the data. And I see there are
a lot of things to be done to get AI really – Because 80% of our time, when we work with
customers and AI-related projects, it is to just start collecting the data, cleaning the data and
managing the data, and only after that can we start running the AI.
(I-3, Lead Data Scientist)
I don’t think they know what data is there. They never made sense of it. It’s not been tuned,
not been managed, I doubt. And there’s no kind of data lineage. What is the purpose and why
was it collected historically vs its purpose now? Is it labelled? Is it normalised?
(I-13, Digital Director and Adjacent Professor)
134 B. Aslam, H. Karjaluoto and E. Varmavuo
Storage of Data
Data Privacy
Implementation of new
frameworks (GDPR etc)
New Data Laws and
Guidelines
Figure 12.1 Result framework: factors afecting successful implementation of AI and required actions.
The fndings also showed that, in some cases, companies are collecting data, but they have
no idea how to use it.
I believe that companies have quite a lot of data, of which a big part is not used. Nobody cares,
and they do not know what they have. So, I would start with what data is there and make
conclusions about whether it is in the right format or not.
(I-5, CEO)
Building a large data warehouse was not considered the optimal approach for companies,
as explained by one of the interviewees (I-6). Instead, the interviewees found starting
with the business goals and the use case, followed by determining what data and tools
were required as well as how to label the data the correct approach.
Davenport et al. (2020) stress the importance of ensuring that these processes do not
hinder gathering relevant data insights from customers and innovating. This conclusion
can also be drawn from the interviews; the interviewees agreed that privacy requirements
and regulations guide the operations of companies. They considered the GDPR the most
signifcant change in data privacy regulations in recent years and stressed its role in mar-
keting practices today. The interviewees saw regulations as having a positive efect on the
incorporation of AI into marketing practices.
I am 100% convinced that GDPR will afect it in a good way. Data privacy is a huge issue
nowadays already, and it will be more so in the future. And now when we have GDPR in
place, it will force the companies to concentrate on these privacy issues already in the beginning.
It is not possible to if something is already up and running; it is very difcult to take into
account certain privacy things. But if we have those rules in place already in the beginning, it
will be a great thing.
(I-6, CEO and Co-Founder)
Data obstacles, privacy and AI 135
I think GDPR was the best thing that could happen in the data business . . . I would say that
these regulations help create fair and sustainable AI business. Fair is kind of the same as being
ethical but an easier concept.
(I-9, Founder and Chairman)
As seen earlier, the GDPR guides companies in the right direction regarding consumer
data privacy from the outset, and it is a major factor when it comes to incorporating AI
into marketing practices. It only has a negative impact when a lack of understanding is
involved.
Another interviewee (I-1) explained that, thanks to the GDPR, consumers are now
more aware of what data are collected about them, and they also understand their respon-
sibility regarding the data they provide, which can be considered positive. However,
customers also expect to gain value from giving out their data via better services. This
connects to the fndings regarding the expectations that consumers have from younger
companies, especially when considering marketing activities that are based on collected
data, such as personalisation. Interviewee I-1 also highlighted that compliance with the
GDPR or other regulations allows companies to create better services and increase their
overall brand image as well as the confdence of certain partners.
While the positive role of the GDPR was emphasised by the interviewees, few chal-
lenges were mentioned concerning related limitations in AI-driven marketing practises.
One challenge described by an interviewee (I-4) was data collection and management
processes.
You have to understand what data you are using and how you are using it and whether the
usage of that data is purposeful for why it was created.
(I-4, Business Lead AI)
Another interviewee (I-11) agreed that the GDPR has complicated things for marketing
practices. However, he emphasised the role of trust between the company and its custom-
ers correspondingly to the rising privacy concerns among consumers that were noted by
Davenport et al. (2020) and Martin, Borah, and Palmatier (2017). Regarding the opinion
presented earlier, Martin and Murphy (2017) also stress the role of providing customers
some control over their data to build trust with the company and increase the likelihood
of customers providing their data. Thus, building trust between a company and its cus-
tomers is critical for receiving customer data while complying with certain regulations,
such as the GDPR.
Discussion
This chapter aimed to determine whether companies are structurally prepared to adopt AI
in terms of data collection and management. This step is important to ensure the optimisa-
tion of AI benefts. We sought to determine how privacy issues and new reforms, such as
the GDPR, can afect a company’s AI initiatives and processes. Our main fndings indicated
that companies might be neglecting the expertise required for sound data collection and
management practices. This is consistent with Saura’s (2020) claim that relevant measures
for improving data management remain scarce. Henke et al. (2016– see Further reading)
emphasise the importance of having proper data ecosystems in place to deliver successful
AI campaigns (Chui, 2017 – see Further reading). In some cases, even companies that are
136 B. Aslam, H. Karjaluoto and E. Varmavuo
collecting large datasets are not utilising them in their favour. We also found that privacy
should be at the centre of data policy when implementing any data initiatives. Martin,
Borah, and Palmatier (2017) state that growing eforts in data collection and usage are
increasing customers’ privacy concerns. Firms must carefully evaluate their usage of con-
sumer data in their innovation and marketing eforts (Bleier, Goldfarb, and Tucker, 2020;
Davenport et al., 2020). New initiatives, such as the GDPR, are helping industries safeguard
consumer privacy without causing problems for AI initiatives. Figure 12.1 extracts the
fndings from this paper. Many data issues must be fxed if companies want to harness AI
technology. Currently, most companies’ data collection and management systems are inad-
equate; they are not striving to collect all possible forms of internal data. External data can
be useful but only after internal data are fully understood. While data collection methods
in older companies are more inadequate than those in newer companies, older companies
can survive without data because they have long-standing, strong relationships with their
customers, and the market recognises their products and/or services. However, to be more
competitive, they must introduce new data collection and management policies. There is
no simple answer regarding which data are the most efective in any campaign; instead, the
desired results need to be identifed before beginning a project to know which data will
help achieve efective results.
There are certain limitations to this research. For example, the data collection was
conducted via semi-structured expert interviews on a rather broad scale instead of focus-
ing on a specifc factor. Although the semi-structured interviews ofered the possibility
of fnding new aspects, this thesis ofers a general overview of the factors that make
data appropriate for practising efective AI campaigns in marketing versus a detailed
description.
Disclaimer
The research presented in this chapter was remodifed from the University of Jyväs-
kylä Master’s thesis ‘Factors afecting the success of AI campaigns in marketing: data perspective
(2020)’. The copyright for this JYU thesis belongs to Varmavuo, Eevi as the Author.
Research presented here has not been otherwise previously published.
Further reading
Al Sheibani, S., Cheung, Y., and Messon, C. (2018). ‘Artifcial Intelligence adoption: AI-readiness at on
Information Systems, Japan 2018. Available at: https://aisel.aisnet.org/pacis2018/
Chui, M. (2017). Artifcial Intelligence: The Next Digital Frontier? London: McKinsey and Company Global
Institute. Availabel at: https://www.mckinsey.com/business-functions/mckinsey-analytics/our-
insights/the-age-of-analytics-competing-in-a-data-driven-world (accessed 15 Oct 2020).
Data obstacles, privacy and AI 137
Emarketer. (2019). Getting Smart about Artifcial Intelligence. Available at: www.emarketer.com/content/
getting-smart-about- artifcial-intelligence
Henke, N., Bughin, J., Chui, M., Manyika, J., Saleh, T., Wiseman, B and Sethupathy, G. (2016). ‘Big
data’s potential just keeps growing. Taking full advantage means companies must incorporate analytics
into their strategic vision and use it to make better, faster decisions’. McKinney and Company. Available
at: https://www.mckinsey.com/business-functions/mckinsey-analytics/our-insights/the-age-of-analytics-
competing-in-a-data-driven-world (accessed 15 Oct 2020).
Jacques Bughin and James Manyika are directors of the McKinsey Global Institute, and Michael Chui is
an MGI partner; Nicolaus Henke and Tamim Saleh are senior partners in McKinsey’s London ofce,
Bill Wiseman is a senior partner in the Taipei ofce, and Guru Sethupathy is a consultant in the
Washington, DC, ofce.
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13 GDPR guidelines for academic
research in marketing
Sachiko Scheuing and Outi Niininen
Introduction
With the introduction of the European Union (EU) General Data Protection Regula-
tion (GDPR, 2016a – see Further reading) and high penalties for failing to protect study
participants’ privacy, academic researchers must now design research that uses personal
data with great care. The processes and documentation requirements for the GDPR are
similar to what is expected by an Institutional Review Board (IRB) (Mourby et al., 2019).
While there are numerous publications on GDPR compliance for academic research in
the medical feld, little has been written about the lawful treatment of data for research in
the marketing context. This chapter attempts to fll this gap and suggests checklists that
researchers can follow for designing GDPR-compliant academic research in marketing.
The topic of sensitive data will not be discussed in detail in this chapter; rather, the
focus is on non-sensitive data. Data collection from secondary sources, including social
media (SM) or third-party registries and databases, is also not addressed in this chapter
because such data may be subject to further restrictive terms of use that are unique to
each platform. Given that this chapter aims to highlight the impact of the GDPR on
academic research, the debate on the intricacies of research styles is also omitted. Finally,
this chapter relies heavily on legal articles, with the majority coming from the law text
itself and regulators’ guidance.
This chapter begins with an overview of IRBs, followed by a brief introduction of
the GDPR and a description of the data used by academic researchers in the feld of
marketing. The chapter’s second half includes a seven-step approach to designing GDPR-
compliant research in marketing, including processes and documents that are required for
a lawful marketing research project.
DOI: 10.4324/9781003093909-17
140 Sachiko Scheuing and Outi Niininen
IRB approval is awarded only after the board members are satisfed with the ethical
soundness of the research design (Ienca et al., 2019).
Typically, IRB members review applications from psychological, medical, biological
or physiological research projects. If the research aims to study respondents in vulner-
able positions, IRB approval becomes essential. Furthermore, academics seeking external
funding may also need IRB approval, even if their research does not involve human
physiological data and is perceived as low risk. High-quality journals may also demand
IRB approval before publishing a study (TENK, 2019).
The responsibility for ethical research practice lies with all researchers, and typically
only high-risk projects are taken through the full IRB review process. IRB processes can
require a signifcant amount of time from even the most experienced researchers. There-
fore, various processes for fltering out low-risk research designs that pose no challenge
to the respondents’ well-being or institutional reputation are implemented. Institutional
research guidelines, for example, participant information packages and self-assessment
for data management practices, can be used to determine the risk level of each proposed
research project. As an example, La Trobe University in Australia has developed a step-
by-step online portal that allows researchers to self-certify projects with a low ethical risk
(see Further reading).
In most instances, the GDPR mainly requests procedural changes to the already well-
defned national codes for ethical research practice. Many research funding bodies and
national-level codes for the ethical conduct of research have now incorporated specifc
GDPR requirements (Meijering et al., 2020; Tikkinen-Piri, Rohunen, and Markkula,
2018).
The GDPR
In May 2018, the GDPR implemented a higher standard of data protection. The EU leg-
islature believed that a stronger data protection law would give EU citizens more control
over their personal data (see the European Commission Statement – see Further reading).
The GDPR is based on seven principles: lawfulness, fairness and transparency; purpose
limitation; data minimisation; accuracy; storage limitation; integrity and confdentiality
(security) and accountability.1
One of the important aims of the law was to harmonise the then-fragmented data pro-
tection laws of EU member states.2 However, perfect harmonisation was not achieved due
to delegated acts in the GDPR that allowed member states to supplement the law with
additional national rules. Thus, even when working with research collaborators within the
EU, some aspects of data protection requirements may difer slightly (Ienca et al., 2019;
Mourby et al., 2019).3 This chapter will focus on the uniform requirements in the GDPR
that were adopted in all EU member states and the United Kingdom (before Brexit).
Step 2 Determine the applicability of the GDPR to the research – Anonymous vs. Personal
Data
Step 3 Decide the legal ground on which to base the data processing for the research
Step 6 Determine if the research requires data sharing, use of service providers and cross-
border data transfer
institution’s Data Protection Ofcer (DPO); determine the applicability of the GDPR to
the study (anonymous vs. personal data); determine the legal grounds for processing data
and whether a research exemption can be applied; study how data are analysed and utilised
and if either results in profling of the respondents and identify whether there are instances
in which the collected data may need to be shared with external organisations, including
any cloud-based software that will be used for, for example, data collection or analysis.
Personal data means any information relating to an identifed or identifable natural person
(‘data subject’); an identifable natural person is one who can be identifed, directly or indirectly,
142 Sachiko Scheuing and Outi Niininen
in particular by reference to an identifer, such as a name, an identifcation number, location
data, an online identifer or to one or more factors specifc to the physical, physiological, genetic,
mental, economic, cultural or social identity of that natural person.6
Thus, any information that can lead to a natural person or can be used to identify a per-
son is considered personal data.
If data are anonymous, the GDPR does not apply to the research. Unlike personal data,
anonymous data are not defned in the GDPR, but there are clues to what requirements
need to be fulflled for data to be classifed as anonymous. Recital 267 of the GDPR
states that data are anonymous only if the researcher, in their capacity as the Controller,8
is not in the position to either identify or single out the person with whom the data are
associated. For instance, if the researcher has no means to (re)identify the research subject
because he/she lacks access to the cross-referencing table, the data may be considered
anonymous9 (Mourby et al., 2018).
Academic researchers, as medical researchers, often apply pseudonymisation tech-
niques to protect the identity of research participants by replacing direct identifers, such
as names and addresses, with unique ID numbers (Verhenneman et al., 2020). While
pseudonymisation is considered a protective measure by the GDPR, pseudonymised data
are still considered personal data; therefore, the law applies.
In the context of qualitative research, the researcher might unintentionally ofer infor-
mation that could lead to the identifcation or singling out of an otherwise anonymous
interviewee. For instance, interviewees may be known for their exceptionally artful com-
munications or even their vocabulary. Citing such respondents may result in the inter-
viewee being identifed if a quote is compared to the respondent’s previous statements
in the press or on SM (Ienca et al., 2019). The paradox here is that it is often the most
unusual, colourful quotes that bring true value to qualitative data analysis.
Step 6: determine whether the research requires data sharing, the use of service
providers and cross-border data transfer
There are instances when data need to be shared externally, including international
research collaboration, the expectation to participate in Open Science, submitting an
article for review to a top journal or completing externally funded research projects
(Mourby et al., 2019). Furthermore, some types of data transfer and data sharing are not
obvious. For example, a simple career move by an academic could result in data being
transferred between institutions and even countries (Mourby et al., 2019).
When sharing data with research partners that require a Controller-to-Controller data
transfer or working in a joint-controllership arrangement, a contractual agreement out-
lining the responsibilities and obligations of the research parties is essential, that is, joint-
controller agreement (Ienca et al., 2019).
A data protection agreement that formalises the Controller-to-Processor relationship
must be put in place when research partners are working on the researcher’s behalf, under
strict instruction or when a service provider, such as a survey platform, is used. The
GDPR requires informing research subjects about the recipient or the category of the
recipient of their data.14
Similarly, if the research data need to be transferred to countries outside the EU, it is
important to ensure that the same level of data protection is granted to the data when it
is transferred to a non-EU jurisdiction as would be used in the EU. Several instruments
can be used; however, the most practical way is to sign a standard template agreement
called Standard Contractual Clauses (SCC), which are drafted by the European Commis-
sion. Currently, there are two types of SCCs: Controller-to-Controller and Controller-
to-Processor (or Processor-to-Processor). The Executive Vice President of the European
Commission Margrethe Vestager has recently signalled that a new set of SCCs could soon
be ready (Chee, 2020; Europa.eu, 2020 – see Further reading). The frst type is suitable
for data sharing with collaboration partners based outside the EU, and the latter is for
cases that are working with service providers based outside the EU. When research data
will be shared across borders, research subjects must be informed of the transfer.15
A recent ruling of the European Court of Justice (ECJ) requires additional protective
measures when transferring data to the United States. This may be particularly relevant
for quantitative marketing research because many internationally recognised online sur-
vey platforms are based in the United States (e.g. SurveyMonkey and Qualtrics). When
using a US-based platform, the level of processing risk must be evaluated on a case-by-
case basis, and a data protection agreement as well as an SCC must be implemented. One
GDPR guidelines for academic research 145
remedy may be adding contractual language to provide extra data protection. However,
at present, neither the court ruling nor the European Data Protection Board has clearly
defned this ‘additional protection’.16,17 An alternative is to use a non-US platform, or
even better, an EU-based online survey provider that does not transfer the data outside
the EU, such as Webropol.
Determine and document measures for protecting collected data throughout the research
process
Figure 13.2 Guidance for the documentation required for GDPR compliant academic research.
146 Sachiko Scheuing and Outi Niininen
As shown in Figure 13.2, the GDPR has several requirements for supporting docu-
ments. Researchers must ensure that documents are written in a clear language that
is easy to understand, demonstrate the completion of a legitimate interest assessment,
include a privacy statement and a record of processing activities, document all measures
aimed at protecting collected data throughout the research process and, if required,
complete the DPIA as well as plan how the study participants’ rights to data protection
can be implemented.
Determine and document measures for protecting the collected data throughout
the research process
Designing compliant research also includes implementing and documenting protective
processes and measures for the data. Many of the processes listed in this section may
already be in place within the researcher’s organisation, and the DPO may be able to help
with fulflling the data protection requirement.
Figure 13.3 Rights of research participants in the context of academic marketing research.
1 GDPR article 15
2 GDPR article 16
3 GDPR article 17
4 GDPR article 18
5 GDPR article 20
6 GDPR article 21
GDPR guidelines for academic research 149
Conclusion
The GDPR requires academic researchers in marketing to approach their data with
extreme caution in a way that is similar to the IRB review process to ensure the ethi-
cal use of data in academic studies. Academic researchers in the feld of marketing will
be able to provide stronger protection to research data by using the seven-step approach
for designing GDPR-compliant research recommended here. DPOs can provide invalu-
able help in generating the necessary documents and implementing research protection
measures.
Further reading
Chee, F. Y. (2020). ‘Revamped EU data transfer tool may be ready by Christmas’. Reuters, September
30. Available at: https://de.reuters.com/article/eu-privacy/revamped-eu-data-transfer-tool-may-be-
ready-by-christmas-idUSL8N2GR5IU (accessed 7 September 2020).
Commission Nationale de l’Informatique et des Libertés (CNIL). Tool for Data Protection Impact Assess-
ment. The CNIL’s DPIA tools are available at: www.cnil.fr/en/open-source-pia-software-helps-carry-
out-data-protection-impact-assesment (accessed 28 August 2020).
Data Protection Network. (2018). ‘Template for legitimate interest assessment’. In Guidance on the Use
of Legitimate Interests under the EU General Data Protection Regulation. Available at: https://dpnetwork.
org.uk/wp-content/uploads/2018/11/DPN-Guidance-A4-Publication-17111.pdf (accessed 4 Sep-
tember 2020).
Europa.eu. (2016a). REGULATION (EU) 2016/679 OF THE EUROPEAN PARLIAMENT AND
OF THE COUNCIL General Data Protection Regulation. Available at: https://eur-lex.europa.eu/legal-
content/EN/TXT/HTML/?uri=CELEX:32016R0679&from=EN (accessed 7 September 2020).
Europa.eu. (2016b). Guidelines for Privacy Statement. See pages 19 and 20 of Guidelines on transparency
under Regulation 2016/679 by European regulators. Available at: https://ec.europa.eu/newsroom/
article29/item-detail.cfm?item_id=622227 (accessed 7 September 2020).
Europa.eu. (2020). Data Protection – Standard Contractual Clauses for Transferring Personal Data to Non-EU
Countries (Implementing Act). Available at: https://ec.europa.eu/info/law/better-regulation/have-your-
say/initiatives/12741-Commission-Implementing-Decision-on-standard-contractual-clauses-for-the-
transfer-of-personal-data-to-third-countries (accessed 7 September 2020).
European Commission. Statement by the European Commission on the GDPR. Available at: https://
ec.europa.eu/info/law/law-topic/data-protection/eu-data-protection-rules_en#background
(accessed 7 September 2020).
Future for Privacy Forum (FPF). The Visual Guide to Practical Data De-identifcation’ under ‘Aggregated
Anonymous’. Available at: https://fpf.org/wp-content/uploads/2016/04/FPF_Visual-Guide-to-Prac-
tical-Data-DeID.pdf (accessed 4 September 2020).
Information Accountability Foundation. (2017). ‘Templates for legitimate interest assessment’. Legitimate
Interests and Integrated Risk and Benefts Assessment: Available at: https://b1f.827.myftpupload.com/wp-
content/uploads/2020/04/Legitimate-Interests-and-Integrated-Risk-and-Benefts-Assessment.pdf
(accessed 7 September 2020).
150 Sachiko Scheuing and Outi Niininen
Information Commissioner’s Ofce (ICO). Checklist for Technical and Organisational Measures. Available
at: https://ico.org.uk/for-organisations/guide-to-data-protection/guide-to-the-general-data-protection-
regulation-gdpr/security/ (accessed 7 September 2020).
Information Commissioner’s Ofce (ICO). Registry of Processing Activities. A template of the ICO can be
downloaded from: https://ico.org.uk/for-organisations/guide-to-data-protection/guide-to-the-
general-data-protection-regulation-gdpr/documentation/how-do-we-document-our-processing-
activities/ then choose ‘documentation template for controller’ (accessed 7 September 2020).
La Trobe University. Step-by-step Online Portal for Self-Certifcating Low Ethical Risk Projects of La Trobe
University, Australia. Available at: www.latrobe.edu.au/researchers/research-ofce/ethics/human-
ethics (accessed 15 September 2020).
Maldof, G. (2016). ‘How GDPR changes the rules for research’. IAPP. Available at: https://iapp.org/
news/a/how-gdpr-changes-the-rules-for-research/ (accessed 13 August 2020).
OneTrust. Registry of Processing Activities. OneTrust has created an unofcial English translation of the
record of processing activities created by the GBA. Available at: www.onetrust.com/wp-content/
uploads/2017/09/Belgian-DPA-Registry-of-Processing-Activities-Template-20170907-EN.xlsx
(accessed 7 September 2020).
Notes
1 GDPR Article 5.
2 The GDPR ‘where as’ (3), (53), (150) and (152).
3 GDPR Article 89(2).
4 Article 29 Working Party Opinion 3/2010 on the principle of accountability https://ec.europa.eu/
justice/article-29/documentation/opinion-recommendation/fles/2010/wp173_en.pdf.
5 GDPR Article 39(1) a.
6 GDPR Article 4(1).
7 Recital 26, for instance, provides a detailed explanation, which is provided in Article 4 of the
GDPR.
8 As defned in the GDPR Article 4(7).
9 In Breyer vs. Germany (C-582–14), the ECJ rules that anonymity is relative, meaning the same
data can be personal data or anonymous data depending on the party http://curia.europa.eu/juris/
document/document.jsf?text=&docid=184668&pageIndex=0&doclang=en&mode=req&dir=&o
cc=frst&part=1&cid=1130557.
10 GDPR Article 4(11), also see GDPR Article 7(4) for examining whether consent is freely given.
11 GDPR Article 6(4) excludes data collected on consent from re-purposing.
12 GDPR Article 6(4).
13 GDPR Article 89, 17(3)d and 21(6).
14 GDPR Article 13(1) e.
15 GDPR Article 13(1) f.
16 The ECJ’s ruling on data transfer to the United States, aka ‘Schrems II’ https://curia.europa.eu/
jcms/upload/docs/application/pdf/2020-07/cp200091en.pdf.
17 The EDPB’s FAQ of the ECJ’s ruling on Case C-311/18-Data Protection Commissioner v
Facebook Ireland Ltd and Maximillian Schrems https://edpb.europa.eu/sites/edpb/fles/fles/
fle1/20200724_edpb_faqoncjeuc31118_en.pdf.
18 Refers to a special category of data defned in Article 9(1): Personal data revealing racial or ethnic origin,
political opinions, religious or philosophical beliefs, or trade union membership, and the processing of genetic data,
biometric data for the purpose of uniquely identifying a natural person, data concerning health or data concerning
a natural person’s sex life or sexual orientation shall be prohibited.
19 GDPR Article 35(3).
20 GDPR Article 4(11).
21 GDPR Article 8(1).
22 GDPR Article 6(1) f.
23 GDPR Article 32.
GDPR guidelines for academic research 151
References
Frauenhofer IOSB, FH-Bielefeld. (2019). Leitlinien für den Datenschutz in der wissenschaftlichen Forschung
zu Aspekten der Mensch-Technik-Interaktion. Karlsruhe, Germany.
Ienca, M., Scheibner, J., Ferretti, A., Gille, F., Amann, J., Sleigh, J., Blasimme, A., and Vayena, E. (2019).
‘How the General Data Protection Regulation changes the rules for scientifc research study’. Panel
for the Future of Science and Technology, ETH Zurich Research Collection. https://doi.org/10.3929/
ethz-b-000391622
Meijering, L., Osborne, T., Hoorn, E., and Montagner, C. (2020). ‘How the GDPR can contribute to
improving geographical research’. Geoforum, pp. 291–295.
Mourby, M., Aidinlis, S., Gowans, H., Smith, H., and Kaye, J. (2019). ‘Governance of academic research
data under the GDPR – Lessons from the UK’. International Data Privacy Law, 9, p. 3. https://doi.
org/10.1093/idpl/ipz010
Mourby, M., Mackey, E., Elliot, M., Gowans, H., Wallace, S. E., Bell, J., Smith, H., Aidinlis, S., and
Kaye, J. (2018). ‘Are ‘pseudonymised’ data always personal data? Implications of the GDPR for admin-
istrative data research in the UK’. Computer Law & Security Review, 34(2), pp. 222–233. https://doi.
org/10.1016/j.clsr.2018.01.002
TENK the Finnish National Board on Research Integrity. (2019). The Ethical Principles of Research with
Human Participants and Ethical Review in the Human Sciences in Finland, 3/2019. Helsinki: Tutkimuseet-
tinen neuvottelukunta.
Tikkinen-Piri, C., Rohunen, A., and Markkula, J. (2018). ‘EU General Data Protection Regulation:
Changes and implications for personal data collecting companies’. Computer Law & Security Review,
34(1), pp. 134–153. https://doi.org/10.1016/j.clsr.2017.05.015
Verhenneman, G., Claes, K., Derèze, J. J., Herijgers, P., Mathieu, C., Rademakers, F. E., Reyda, R., and
Vanautgaerden, M. (2020). ‘How GDPR enhances transparency and fosters pseudonymisation in
academic medical research’. European Journal of Health Law, 27(1), pp. 35–57. https://doi.
org/10.1163/15718093-12251009
14 ‘Interesting but scary’
Customers’ perceived value of MyData
Heidi Haapio and Outi Uusitalo
Introduction
Most organisations regularly collect large amounts of data about their customers and use
it for diferent purposes. When consumers use their credit cards or apps or allow the use
of cookies, they accept the storage of the data in a data warehouse. The owner of the data
warehouse can mine the information and selectively use it to ft the needs of the organisa-
tion ( Janasik-Honkela and Ruckenstein, 2016).
Big Data is a new form of capital: it facilitates decision-making and operations. Data
are also a valuable resource for organisations because understanding customers’ buying
behaviours and constantly changing needs helps organisations develop the direction of
their operations and servicescapes ( Janasik-Honkela and Ruckenstein, 2016). Informa-
tion is used to predict customers’ actions and contemplate and estimate tactics and stra-
tegic business activities. Recent discussion has emphasised the quality of data, analytic
tools and the ability to analyse and use data in decision-making (Erevelles, Fukawa, and
Swayne, 2016; Gandomi and Haider, 2015).
Despite the proliferation of data collected from customers and the transformation of
customers’ actions into data – a phenomenon called datafcation (Ruckenstein and Schull,
2017) – there is still little understanding of how customers can control and use that data.
To date, two major approaches have been identifed. In the frst approach, organisa-
tions ofer access to data to their customers via diferent websites and apps. For instance,
electric companies ofer information about their customers’ electricity usage, which the
customers can use to fnd ways to reduce their own electricity consumption. The second
approach is consumers collecting data themselves, such as with sports trackers and mobile
phones. Various apps provide tools for analysing, for example, one’s everyday activity or
quality of sleep. Both forms of data are called MyData.
Datafcation has raised concerns about and awareness of the possible risks of sharing
personal data. Nevertheless, data equal value for organisations and customers. Previous
research has addressed the issues of well-being apps (e.g. Koivumäki et al., 2017), and the
value of the data to organisations (Kumar and Reinartz, 2016). Saarijärvi (2012) focuses
on grocery shoppers’ reverse use of data (customers using data that have been collected
about them) from nutrition codes to support healthy eating, which could lead to changes
in customers’ buying habits.
One risk to this approach, as perceived by customers, is uncertainty about the types and
details included in the data. Previous studies indicate that customers’ main worries include
data privacy and security (Kshetri, 2014; Kuoppamäki, Uusitalo, and Kemppainen,
DOI: 10.4324/9781003093909-18
Customers’ Perceived value of MyData 153
2018). However, other dimensions of data, such as its direction (positive vs. negative) or
its potential to awaken thoughts, feelings or social meanings, have rarely been addressed.
Data are coveted as a valuable resource in the marketplace because they can reveal
insights regarding customers’ actions and uncover previously unknown patterns (Erev-
elles, Fukawa, and Swayne, 2016). Previous studies have examined customers’ perspec-
tives on MyData, including its benefts and afordance in the feld of self-tracking and
quantifed self, measuring health and exercise information (Nafus and Sherman, 2014;
Ruckenstein and Pantzar, 2017). Studies in information technology have proposed mod-
els for how to exploit data and share it with diferent actors. However, regarding data
value, little is known about its content, the prerequisites for creating it, when it decreases
and its contradictions. This study aims to increase our understanding of how consumers
beneft from these data. We examine what MyData means to customers, how they defne
data that capture their purchases and how they feel after they have explored the data.
Describe freely what kind of thoughts you had when you saw your shopping data n = 1,703
Give free-form feedback on the features of the Omat ostot service and its usability n = 706
Give free-form feedback on how the Omat ostot service could be improved n = 404
If you want, please state any compliments you have for the developers of the service n = 283
If you want, please write feedback on this questionnaire; you can also further defne n = 93
previous answers if needed
Customers’ Perceived value of MyData 155
word or a smiley face. The one-word answers and answers that included, for example,
addresses, were deleted, resulting in 1,259 answers being included in the data analysis.
The textual data were analysed using the qualitative content analysis technique as follows:
(a) the material was coded; (b) the codes were reworked iteratively several times to ensure
that all possible codes were found; (c) words, phrases and sentences that emerged from
the data were used as code units (e.g. the codes funny, big brother, unnecessary, amaze-
ment and fear were generated from the data); (d) all codes were arranged into categories;
(e) categories were examined carefully so that all the relationships between the categories
were found and potential new categories were identifed and (f ) larger themes were con-
stituted based on the categories (Eriksson and Kovalainen, 2015; Hair et al., 2016).
Findings
Analysis of the data produced six themes – entertainment, learning, refecting on buying
behaviour, easing everyday living, transparency and privacy – which refected the value
experienced by the respondents when examining their data.
The results found that 47% of the respondents mentioned things that were either posi-
tively or negatively related to entertainment, while a refection of buying behaviour was
present in 29% of the responses. Learning and privacy were both adduced in 7.4% of the
responses, and transparency was highlighted in 7.1% of the responses. Easing everyday
life was highlighted in only 2.1% of the responses, but notably, the answers in this value
refected more negative than positive associations.
I was shocked by how much I buy sweets and chocolate. I hadn’t realised the amount of euros
I spent on those. I think this kind of service really opens your eyes.
(female, aged 35–44)
It was absolutely a shock that the second most money has gone to cheese after fuel. All aspects
are demonstrative of your own buying habits.
(male, aged 45–59)
However, refecting on one’s purchases via the data was described as a useful experience.
The expenditures and their content became understandable.
The experience was WOW!! Here my life is now wide open – when I go to a store, where I
shop, what I buy and how much. But all the same, I think the information I received is very
interesting and certainly thought-provoking.
(male, aged 25–34)
Customers’ Perceived value of MyData 157
One consequence of refecting on their shopping habits was the strengthened perception
of previously invisible purchasing habits. Even without obtaining any new information,
it was felt that buying behaviour can be managed, which strengthened the positivity of
the experience.
Group 2: uselessness
Several responses indicated that the users of the service failed to recognise why they
should use their data and how to beneft from the information. We labelled this value
uselessness, as it refects lack of excellence (Willems, Leroi-Werelds, and Swinnen, 2016).
In Holbrook’s (1999) typology, this type of value is self-oriented and aimed at gaining
external benefts, such as saving money. This value is considered reactive because it does
not imply any actions from the consumer.
Here, uselessness involved expressions of refecting on buying behaviour (negative),
learning (negative), entertainment (positive and negative) and easing everyday life (nega-
tive). However, at the time of the survey, the service was not yet published and the
respondents used it only to answer the survey. Therefore, the respondents may not yet
have found reasons for using the service.
Entertainment involved responses that described looking at MyData as ‘just for fun’.
When the respondents did not see a purpose for watching their data, they did not per-
ceive any aspects that would afect them, such as their buying behaviour. Exploring their
data was mostly considered fun yet pointless. For some respondents, the amount of data
ofered caused anxiety and even irritation. Some responses included the following:
When reviewing one’s buying behaviour was considered negative, there was nothing to
refect on, and thus, the service was considered unnecessary. Some respondents also felt
insulted about the insinuation that they needed help with their memory and understand-
ing of past purchases.
I know what I have bought, and I don’t need any services for this.
(male, aged 45–59)
I feel that such detailed information is unnecessary, and I don’t understand how I could use it.
I have budgeted my expenses and have kept track of my purchases for decades, so I know what
I am spending my money on.
(female, aged 60–69)
The respondents who considered learning negative connected it to a lack of need or rea-
son. In these cases, the respondents reacted extremely negatively to the service:
158 Heidi Haapio and Outi Uusitalo
Completely unnecessary and indiferent service that ofcers who regulate consumers and Data
Protection have already been forbidden [from using].
(male, aged 60–69)
I don’t see any reasons why I would need information about my own purchases. It wouldn’t
guide me to make certain types of purchases.
(female, aged 45–59)
Uselessness was connected to negative meanings regarding easing everyday life, which
became more complicated and difcult when using this service. This was justifed because
signing into a new system requires remembering a new username and time to look at the
data. Some complaints were as follows:
Group 3: privacy
The responses conveyed several worries related to privacy, such as feelings of being moni-
tored and spied on by organisations. The concern that a third party is monitoring cus-
tomers’ shopping raised the respondents’ concerns that service providers are invading
people’s private lives. Privacy was also associated with worries about information secu-
rity. Customers’ information could end up with an unintended party; thus, others could
review the data without permission. Privacy value is similar to aesthetics (Gallarza et al.,
2017). Connected to Holbrook’s (1999) model, the privacy of data is a self-related and
intrinsic value, especially when consumers feel that their privacy has been violated. It was
also reactive because the respondents did not want to give out such information.
The fear of losing their privacy stirred strong feelings of irritation, distress and fright. It
was interesting when the respondents realised that, regardless of their wishes, the organ-
isation was collecting information about its customers, and the Omat ostot service is
not the only service that collects and analyses MyData. Some respondents’ comments
included the following:
The information is endangering privacy if it’s available for others, such as from an error in infor-
mation technology, data theft or due to some other situation.
(male, aged 45–59)
Privacy was considered important, and the threat of losing privacy created negative feel-
ings. There were also suspicions about opportunism. The Omat ostot service is useful
Customers’ Perceived value of MyData 159
for S-Group; thus, they tried to sell data collection as acceptable in the eyes of custom-
ers. The control of privacy translated to an unwillingness to let others see the customers’
shopping data and the customers not wanting to look at the data themselves.
Group 4: transparency
In our study context, transparency is other-oriented, that is, created when customers
have an experience through others, such as seeing what family members have bought.
Transparency is active because customers must sign in to the service to see the data. It is
also intrinsic because customers do not consider benefts, such as savings, but instead seek
the feeling of transparency. In line with these characteristics, transparency as value refects
ethics (Gallarza et al., 2017).
Transparency can be either positive or negative. When transparency was considered
positive, it was seen as fair to return the data to customers. Given that the company was
collecting the data anyway, sharing the data with customers was seen as a benevolent act
of transparency. Customers want both companies and the data to be transparent. Some
customers even wanted as much data as possible to use for themselves. Transparency had
a negative value for customers when it was connected with troublesome situations, such
as when all family members could see the information that was collected. Transparency
can be uncomfortable for people who presume that no one else knows what they have
bought. Some relevant comments included the following:
Of course, S-Group uses the service for their own company, but it is great that the shopping
information is also available to consumers. As long as the consumer data is not spread out to
outsiders.
(female, aged 25–34)
It is fair that I can look at my own shopping when the statistics are compiled anyway, such as
for marketing.
(female, aged 45–59)
During the survey, data were collected from the Omat ostot service via S-cards but not
from collateral family member card owners. In the responses, transparency was consid-
ered from this perspective, but there were contradictory goals among the respondents.
The service was sometimes considered useful and sometimes not when the entire house-
hold’s information was given. The latter opinion was connected with controlling their
data and preventing other family members from seeing it. Some respondents even wanted
to delete the data. In these cases, transparency was a debilitating factor and included the
potential for conficts and discord, which could lead to avoiding authentication or keep-
ing the data secret if possible.
Disclaimer
The research presented in this chapter was collected for my University of Jyväskylä Mas-
ter’s thesis ‘On reilua, että voin itsekin katsoa ostoksiani’ – Arvon muodostuminen omadatan kon-
tekstissa (2018). The copyright for this JYU thesis belongs to Heidi Haapio as the Author.
Research presented here has not been otherwise previously published.
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Section 5
Introduction
When predicting the future, especially in Digital Marketing (DM), for customer–frm
communication platforms, the only given is that there will be constant change. Although
we believe that many of the old models/theories of marketing and communication will
still be valid and used to understand the future of DM, it is clear that we will also see the
rise of new models and theories for better mapping and understanding of the customer
in the digital era. For this academic research chapter on anticipating key DM trends, we
are fortunate to have the opinions of some of the world’s leading researchers as well as
practising DM and Social Media (SM) Manager to highlight trends emerging from the
literature and account management practice.
This chapter frstly explores the future of automation, Artifcial Intelligence (AI) and
chatbots and their potential impact on customer–company communication. This is fol-
lowed by a discussion of the future roles that infuencers may have as well as the emerging
negative aspects of DM Communication. This chapter concludes with a review of the
impact that blockchain technology can have on DM and business in general.
AI and automation
As discussed in previous chapters, AI and automation are current buzzwords that are used
regarding the future of DM. Although AI has existed for decades, we believe that it is
still in its infancy regarding its potential. In the future, AI will replace many increasingly
complicated tasks in the digital landscape, from telephone sales to a more profound role in
customer communications, such as personalising communications and recommendations
for customers. Automation, in turn, will signifcantly afect how marketing communica-
tions are conducted. Marketing automation, when combined with AI, will lead to more
completely automated digital communication. Everything from automated email news-
letters to automated chatbots is becoming wiser each year and will presumably replace
humans in the future.
AI is already an integral part of targeting digital advertising. Ad platforms, such as Face-
book and Google, are giving advertisers more options to use AI to fnd the most potential
customers. At the same time, those platforms are ofering fewer manual options for ad
targeting. However, AI requires data to function. The more money that is invested in ads,
the more data that are collected, which leads to better AI ad targeting. The same theory
applies to any other AI application: the more data, the better it works. In the context of
marketing, the amount of data gathered correlates with the number of people interacting
DOI: 10.4324/9781003093909-20
166 Outi Niininen et al.
with DM. Advertisers with big budgets will be able to drive more trafc to their websites;
thus, they will beneft more from AI than companies with lower budgets. This raises a
question regarding equality: does AI create an unfair advantage for bigger businesses?
Chatbots
What are chatbots? They are simply computer programmes that are expected to imitate
human conversation, typically on a website, an SM platform (such as messenger) or
a mobile app. The form of conversation to date has mostly been text, but it can also
include speech (such as Amazon’s Alexa). Chatbots are most commonly used to either
help potential or existing customers on a website or SM platform complete their task
or to ofer customer service in general. Ultimately, the main goal of the chatbot is to
drive sales.
Real-time communication via chatbots will continue to grow exponentially, and some
would even argue that it is a glorious march. Increasing numbers of businesses have
installed chatbots on their websites to assist and guide website visitors in their searches.
Chatbots also encourage customers towards a Call to Action, such as making a purchase
or downloading content. The challenge with many chatbots to date has been that, even
though they all use AI, few are helping the website visitor. We hope and believe that, in
the coming years, chatbots will become wiser and thus add value for the website visitor.
Chatbots emerged in 2014 and have become one of the fastest growing digital oppor-
tunities concerning frm–customer communication online. On the positive side, chatbots
never sleep and can guide us 24/7. The most advanced bots also work well without
any human intervention. Thus, replacing some human customer service operators with
automated chatbots can ofer organisations savings as well as 24/7 fexibility. In addition,
chatbots are excellent market researchers because they constantly collect data from their
interactions with customers. Analysis of the data collected by chatbots can reveal many
important issues, such as what slows customers in the purchasing process; at what pur-
chasing stages customers end the conversation and leave the website (e.g. the chatbot is
not working well) and issues related to customers’ levels of engagement and satisfaction.
However, scientifc research on chatbots is still in its infancy. Recent research has
revealed that consumers are frustrated with chatbots’ poor functionality (Adam, Wessel,
and Benlian, 2020; Shumanov and Johnson, 2020). In another recent study of 205 Ger-
man respondents, perceived usefulness and perceived enjoyment were the key drivers of
consumers’ acceptance and use of chatbots (Rese, Ganster, and Baier, 2020). By contrast,
consumers have concerns regarding privacy and the immaturity of the technology.
What chatbots should and should not do depends on the context. For example, a chat-
bot could be programmed to recommend relevant content after a website visitor has read
80% of an article or to propose a time for an instructional phone call after a consumer has
downloaded demo software.
Data surveillance
One of the most controversial aspects of digital technology use for marketing and com-
munication purposes is utilising data collected through consumer–organisation interac-
tions, such as via chatbots, and consumers’ online behaviours on organisational websites,
ofcial SM accounts, etc. Every time a consumer interacts with an organisation, brand
or specifc online content, a ‘footprint’ of this interaction is saved and registered. These
data are, indeed, an important resource for digital marketers and communicators, who
can then better understand and target their consumers with further digital content and
enticing ofers. While this practice is widely spread across industries and organisational
types and sizes (Valentini, 2018), it has increased attention towards Data Surveillance – a
specifc form of targeted monitoring of our online behaviours, which often occurs with-
out our knowledge. Han (2015) underlines this paradox when stating that while Web 2.0
and in general digital media have increased the transparency of what is going on around
the world and in organisations, they have also created more control and can produce a
‘digital panopticon’ (i.e. a central place from which everyone can be observed and con-
trolled everywhere and by anyone).
This dark side of data collection, which has been a panacea for many years in DM
research and consumer behaviour understanding, poses several problems in terms of who
owns the data, who can use it and for what purposes.
In recent years, privacy and data security matters have emerged as hot topics among
citizens, legislators and organisations. At the European level, this phenomenon has been
addressed through several regulations limiting the rights of collecting and using data from
consumers without their consent. The 2017 European General Data Protection Regula-
tion (GDPR) is today one of the most advanced regulations in the world for supervising
this specifc aspect. This regulation has already impacted the data collection practices
170 Outi Niininen et al.
of many companies worldwide because the protection applies to data collected on EU
citizens, whether it is processed in or outside European countries (Valentini, 2017). How-
ever, new forms of data collection and monitoring are and will occur that can bypass legal
requirements, leaving ethical concerns for future digital consumers.
Conclusions
In conclusion, the key changes we foresee changing the DM landscape are as follows:
the future of DM Communication will see greater automation (e.g. AI-enabled chatbot
technology) that aims to create a better customer experience with true 24/7 access, and
with improvements in Natural Language Processing (NLP), future chatbots will be able
to provide expert customer service with ‘standardised politeness’ and without breaks.
The introduction of SM has changed the balance of cyberspace control, with con-
sumers and organisations now co-existing on digital platforms. Consumers are creating
content not only for other consumers but also for brands and organisations (UGC). The
most successful individuals sharing content online have become infuencers whose mes-
sages impact buying behaviour worldwide (we predict that particularly video content will
have a notable impact in shaping future consumption patterns). However, these powerful
infuencers have used business-like analytics to shape their content to attract an audience
and form (paid) business collaborations. To maintain their authentic appeal, infuenc-
ers must fnd a balance between being a paid collaborator and simply another online
consumer.
Unfortunately, the blending of branded communication and UGC has also introduced
negative aspects to digital communication: free digital labour is a potential outcome of
individuals engaging with brands online when data surveillance harvests customer infor-
mation from our online interactions. The GDPR and other recently introduced national
privacy codes aim to empower consumers to take some control of their gathered data.
Unfortunately, until we reach the full implementation of blockchain technology with
cryptographically stored personal identifying data, consumers will not be in full control
of how their data are utilised.
Blockchain technology will also bring new levels of trustworthiness to online interac-
tions through cryptographically secured peer-to-peer distributed immutable ledgers. This
technology can eradicate deepfakes and bring full traceability to supply chains, from raw
materials to fnal consumption, and eliminate counterfeits. Blockchain will also revolu-
tionise online advertising technology: in the future, consumers can choose which adver-
tisements to view and even be fnancially rewarded for doing so.
174 Outi Niininen et al.
Future research
• Once AI-empowered chatbots can better imitate human communication, how
should consumer trust (of chatbot-powered online communication) be managed?
• Critical research into the balancing of authenticity and self-branding activities of
SMIs is required. Such studies should compare the views of advertising executives,
SMIs and academic researchers.
• DM and SM can also introduce negative tones of communication to online inter-
actions. How can such negative implications be minimised?
• With consumers confused by blockchain as a concept, how can this new technol-
ogy be harnessed to create trust in the online environment?
Further reading
Brave. (2019). ‘Brave software and TAP network put blockchain to work with new partnership’. Press
Release, February 26. Available at: https://brave.com/brave-tap-Blockchain/
Marr, B. (2018). Why Blockchain Could Kill Uber. Available at: www.forbes.com/sites/bernardmarr/
2018/02/09/whyblockchain-could-kill-uber/ (accessed 6 March 2021).
Mattioli, D. (2020). Amazon Scooped Up Data from Its Own Sellers to Launch Competing Products. Available
at: www.wsj.com/articles/amazon-scooped-up-data-from-its-own-sellers-to-launch-competing-
products11587650015 (accessed 6 March 2021).
Simonite, T. (2020, July 7). ‘Deepfakes are becoming the hot new corporate training too’. Wired/Busi-
ness. Available at: www.wired.com/story/covid-drives-real-businesses-deepfake-technology/
(accessed 16 December 2020).
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16 Conclusions
Outi Niininen
The fve sections of this book covered some key trends evident in the Digital Marketing
(DM) and Communication feld: Data analytics and measurement, Digital trans-
formation and innovations in marketing, Customer experience and (the merging
of digital and physical) servicescapes, Ethics and privacy in digital marketing, and
Future for digital marketing communications and Conclusions relevant to DM.
In Section 1, Chapter 2 highlighted several challenges emerging from Big Data and
the IoT. This chapter addressed these trends across the full 8Ps of the Marketing Mix
structure – Product, Price, Place, Promotion, Process, Physical evidence, Partnerships and
People – to highlight how pervasive these new digital technologies are for the business
of marketing. The volume of unstructured data for marketing decision-making support
has never been this high; notably, we are not yet able to address the volume (too much),
velocity (faster arrival) and variety (diversity) of characteristics of such data (an extensive
description of the ‘V’ characteristics of Big Data can be found in Hussein [2020]). AI
and NLP applications are already assisting managers in decision-making in stable business
environments. While AI-assisted strategic decision-making is also an emerging trend,
any innovative decision-making is best left to human minds (i.e. AI should be used to
augment decision-making and not to replace human strategy formulation and human
responses to unanticipated events).
The Big Data analytics is likely to expand beyond an object’s sphere to include talent
analytics, which aims to assist individuals in achieving their peak performance. This will
extend the debate of privacy, Big Data and AI to the Human Resources (HR) feld. In
general, HR is not within the focus of this book, but it must be recognised that the future
skills required for DM decision-making can be vastly diferent from what is expected of
today’s Marketing Managers.
The volume of data gathered regarding target audiences’ online behaviour is vast; our
digital footprints reach across the business use of online applications to entertainment
and socialising via digital applications. The EU acknowledges that, at times, the data
harvested from individuals do more than simply aim to ofer better services to customers;
such data can potentially be used to build extensive customer profles, which could then
be used for targeted advertisements. The General Data Protection Regulation (GDPR) is
designed to address the harvesting and packaging of personal data (processing) for com-
mercial purposes without explicit permission from the individual. However, the GDPR
has far-reaching implications for DM in general because any data that can be used to
identify a natural person (European citizen) is guided by this regulation, and organisations
dealing with such data must take extra steps to ensure that the data collected are (a) accu-
rate, (b) protected from unauthorised access and transfer outside the EU region and
DOI: 10.4324/9781003093909-21
Conclusions 177
(c) not used for automated profling, which could be detrimental to the individual (see
Further reading: Article 22 of the GDPR). Today’s DM organisations must carefully plan
how personal data are handled within their own processes and shared with partner organ-
isations. The IoT will present interesting questions in this regard (e.g. voice-controlled
devices that can be used to streamline our daily tasks and complete routine transactions
can leave a record of highly personal data because one’s voice is an identifable character-
istic). However, the privacy vs. marketing data challenge has already been acknowledged
by ‘Big Tech’ companies. For example, Google is drafting guidelines for responsible AI
uses that include liability considerations (Goul, Sidorova, and Saltz, 2020), and Apple
appears to be positioning itself as the privacy champion of smartphones.
As is evident in Chapter 3 data-driven (marketing) decision-making processes ofer
organisations unprecedented opportunities to refne their management and strategies
across all organisational functions. The organisational culture refers to all the values and
norms shared within the organisation; thus, it is no surprise that cultural barriers also
infuence data-driven decision-making. Specifcally, the interviewees noted the lack of
common language and ‘silo-thinking’ as a hindrance to data distribution. Proactive data-
sharing practices and encouragement for professional personal development were viewed
as a positive development towards constructive marketing analytics utilisation. Rigid
structural barriers were also identifed as a barrier to fuid data utilisation. Finally, mana-
gerial barriers were cited as an obstacle for the implementation of data-driven processes,
especially when the top management was not familiar with either the data or the analytics
applications. Therefore, a shift in the overall organisational culture is needed to fully uti-
lise these opportunities. For example, marketing analytics and data are not only benefcial
for the marketing department but should be utilised for the competitive advantage of the
entire organisation. Consistent, long-term change initiatives are required from top man-
agement to fnd the balance between overall business opportunities ofered by marketing
analytics and potential data fatigue.
The conclusions from Chapter 4 highlighted several advantages of Programmatic
Advertising, such as sophisticated and granular audience segmentation based on holistic
online audience profles. Granular audience segmentation relies on layers of audience
attributes, such as demographics, location, interests and online behaviour, which enable
lookalike audience targeting. Programmatic Advertising also reduces ad impression dupli-
cation across channels/devices and enables a more holistic evaluation of a campaign’s
success.
However, Programmatic Advertising has some challenges, such as platform and data
fees (the more layers applied to audience targeting, the greater the cost), the audience
buying concept is difcult to appreciate and, at times, it is easy to construe the system as
inefcient. Furthermore, the limits of specifc sizes and formats for banner ad inventories
can also limit Programmatic Advertising. Owners of premium ad placements with high
reach and viewability are reluctant to sell such impressions via programmatic channels.
Regional fragmentation of ad inventories can also limit the efective use of Programmatic
Advertising. Finally, Programmatic Advertising is highly technical in nature, and further
research, especially into Programmatic Creative, is required for a holistic understanding
of this topic.
Section 2 comprised three chapters. Chapter 5 explored the role that Consumer Brand
Experience plays when consumers interact with company web pages. This chapter iden-
tifed the central role that a website’s appearance has in evoking Consumer Brand Expe-
rience, which can, in turn, result in brand trust, electronic Word-of-Mouth (eWOM)
178 Outi Niininen
and favourable behavioural intentions. The fndings from this study elevated the website’s
aesthetic design features to a new level of importance.
Chapter 6 concluded that UX studies are valuable for e-commerce sites because there
is a link between good usability and positive UX and adoption. UX can also predict a
trusting customer–company relationship, which can lead to purchase intention. Perhaps,
the greatest contribution UX studies ofer for e-commerce websites is the opportunity
to remove potential pain points from website design before they can have a detrimental
impact on certain functions (e.g. sales). Hence, a UX study is recommended after each
website (re)design to solve any potential problems. UX development and customer jour-
ney planning should be a continuous process. Furthermore, UX practice has demon-
strated that the majority of usability issues can be identifed with only six users.
The case study adopted for Chapter 6 asked the participants to complete six main
tasks: go to the brand’s website, evaluate the product’s attributes, add the product to the
shopping cart, proceed to the checkout, sign up for the newsletter and complete the exit
interview. The UX analysis identifed minor design features that reduced the ease with
which the users interacted with the website (e.g. low contrast in buttons and links, small
fonts used and inconspicuous secondary navigation). Such fndings could be added to any
web developer’s checklist because they are easily overlooked at the design stage.
Chapter 7 highlighted future changes in consumer decision-making once we have
become comfortable ordering goods through conversations with the VAs in our homes.
A secondary, and likely, outcome will be that as customers become comfortable buy-
ing products from a narrower selection ofered by VAs and appreciate the convenience,
they will make repeat purchases. Will this result in limited decision-making, learning or
memory capacity in general, such as that reported by Tanil and Yong (2020) for smart-
phone adoption? Furthermore, will our large-scale reliance result in future consumers
losing the capacity to compare complex products or to select the best match from a larger
selection of items?
For marketers, a voice-based ecosystem is an opportunity to increase brand awareness
and create new augmented product oferings – a notable opportunity in the current
COVID-19 social isolation environment. VAs and commerce ofer interesting psycho-
logical challenges for future researchers, whereas digital marketers will have to develop
an entire voice-based ecosystem that is similar to current text- (or image-) based search
engine marketing.
Section 3 included three chapters. Chapters 8 and 9 explored the social aspect of
servicescapes and how digital (and mobile) technology could augment these service
experiences. These two chapters took diferent approaches to place, atmospherics and
servicescape, but both concluded that virtual shopping places can imitate the social
and physical atmospherics of a traditional brick-and-mortar store. Online environ-
ment enhances opportunities for customers to gain added value benefts. Such a trend
is, indeed, recognised by retailers that now ofer multichannel transaction opportuni-
ties. With the COVID-19 pandemic forcing consumers to seek information and buy
products online at increasing rates, the future of omnichannel retailing looks promis-
ing. However, physical retail outlets could start playing an increasingly social role in
retail, even if products are ordered online.
Chapter 10 outlined how Social Media (SM) enables interactions between con-
sumers and organisations. These should be viewed as accumulative social interactions
online and should not be represented by simple numerical values of likes and shares.
Consumers’ motivation to interact with brands online could determine whether the
Conclusions 179
interaction will either co-create or destroy value. DM and communication specialists
can use SM to gauge consumer preferences and identify behavioural patterns. Notably,
Chapter 15 further highlighted the role that infuencers can play in DM as well as the
negative aspects of engaging consumers in (work-like) tasks in the value co-creation
process.
Section 4 included four chapters that focused on ethics, privacy and the EU GDPR
across various DM situations. Chapter 11 linked customers’ perception of retailers’ ethics
to their channel selection (brick-and-mortar, online and multichannel retail). Consumers
evaluated available channels by variables, such as convenience, perceived risk, information
search ability and ethical considerations. The higher perceived risk of online purchases
could be ofset by ethics linked to retailers’ websites. Online and multichannel shoppers
reported heightened concerns for retailer ethics, especially those who bought products
online frequently. This highlighted the importance of transparency of ethical conduct for
all online retailers. However, further research into the consumer interpretation of retailer
ethics is required as new (online) retail channels emerge. Furthermore, as ethical inter-
pretations are highly culturally dependent, fndings from one country to another are not
easily transferable.
Based on interviews conducted in fve diferent countries, Chapter 12 reported
on the impacts that the GDPR initiatives have had on AI applications. Considering
that the GDPR was initially viewed as highly restrictive by organisations working to
become compliant, the feedback from AI technology experts was rather positive: the
GDPR had placed an organisational focus on customer privacy and the processes com-
panies should implement to protect their interests. Private citizens have also become
more aware of the potential for harvesting their data and the value that customer data
can bring to companies. This study also highlighted the notion of consumers ‘trading
their personal information’ for better service, a more enjoyable browsing experience
or targeted, tailor-made ofers, as suggested by Niininen, March, and Buhalis already
in 2006 and 2007.
Chapter 13 applied the GDPR Guidelines for Academic Research in Marketing. Although
the GDPR was supposed to harmonise European data management practices, the real-
ity is that the GDPR (and related privacy regulations) still allows each member state to
supplement the regulations with their own legislation. Thus, a move from one country
to another by a researcher might change the interpretation of the regulation. This chapter
introduced a seven-step approach to achieving GDPR-compliant research, with some
steps aligning with the Institutional Review Board for the ethical conduct of research
recommendations (many national ethical research guidelines have also incorporated the
essential GDPR regulations). Academics conducting research in marketing should pay
special attention to online services (e.g. online survey software or cloud storage) used
for data collection, which could unintentionally result in sharing individual information
between the EU and the United States. Qualitative research colleagues should also take
care when citing study participants who use particularly colourful expressions because
this could result in the individual being identifed. One’s voice is also an identifable vari-
able, and it should be treated as such.
Chapter 14 outlines a study wherein customer loyalty application was piloted (n =
1,259). Qualitative feedback on the new application was classifed under four major
headings: benefts (e.g. customers used the data to make more informed buying decisions,
such as for following a healthier diet or budgeting their expenditures better); uselessness
(i.e. when customers could not understand how they could beneft from access to the
180 Outi Niininen
data); privacy (i.e. when customers were concerned that their shopping behaviour was
being monitored) and transparency (i.e. when the respondent’s emotions varied between
positive and negative, depending on their situation because the loyalty cards to which the
application was linked were commonly issued for all family members).
Chapter 15 re-emphasised the vital role that AI will play in interpreting Big Data into
actionable datasets. Natural Language Processing will introduce human-like communica-
tion to chatbots that never sleep, making this the ultimate customer service opportunity.
However, AI is not yet producing content that entices customers in a way that is equal to
that of human infuencers. The appeal of infuencers is linked to liking peers who share
aspects of our lives or those who volunteer their expertise in a feld that interests us. In
the future, AI infuencers may be possible, but by then, blockchain technology will have
hopefully developed to such an extent that audiences can verify the identity of infuenc-
ers (and deepfakes) whose messages they read.
Some chapters in this book had already addressed the value of User-Generated Con-
tent where private citizens amass an SM following through exceptional content. This
is an interesting paradox: organisations are keen to harness these infuencers (who are
often perceived to be independent from any brand) for positive consumer sentiment, and
some infuencers are keen to explore paid collaboration opportunities with brands. If that
occurs, how will ‘authentic content’ be ensured? Moreover, some argue that enticing
consumers to interact with brands is a form of unpaid digital labour!
The potential future applications of digital communications technology also pose chal-
lenges: as consumers, we regularly trade information about our buying preferences to
obtain better quality services, but when will this enter the realm of ‘data surveillance’?
The introduction of the GDPR has brought publicity to the practice of tracking con-
sumer behaviour online, and new privacy regulations have already been introduced in
many jurisdictions.
Blockchain technology is another major opportunity for DM as well as other busi-
nesses (i.e. a major disruption). The trust protocols ofered by blockchain will, for exam-
ple, make deepfakes easier to identify and increase the tools that consumers have to
protect/manage their personal data. True ownership of our personal data can revert back
to us as consumers if we store our data cryptographically in a digitally encrypted, secure
wallet, which would eliminate third-party access. In this sense, a new layer of trust can be
injected into the Internet’s ecosystem.
This book has outlined major changes currently taking place in the DM and commu-
nications feld. Some of these developments are at the conceptual stage, while for others,
the technology already exists. We have also outlined various research methodologies suit-
able for the DM and communication context and made specifc recommendations for
future research. We hope these will be helpful for the next wave of research in the DM
and communications feld.
As the editor, I thank all the authors and anonymous reviewers who made this project
possible. Special thanks are also owed to the Taylor & Francis team for your support dur-
ing this book editing process as well as for polishing this book into its fnal format.
Further reading
Europa.eu. (2016). Regulation (EU) 2016/679 of the European Parliament and of the Council General Data
Protection Regulation. Available at: https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=
CELEX:32016R0679&from=EN
Conclusions 181
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Niininen, O., Buhalis, D., and March, R. (2007). ‘Customer empowerment in tourism through Con-
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memory’. PLoS ONE, 15(8), e0219233. https://doi.org/10.1371/journal.pone.0219233
Index
Note: Page numbers in italics indicate a fgure and page numbers in bold indicate a table on the
corresponding page. Page numbers followed by ‘n’ indicate a note.