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Online Shoppers are Willing to Pay More for Privacy

Caroline Matische writes "People are willing to pay more to buy items from online retailers who make their privacy policies clear, a new Carnegie Mellon University study showed. People were more likely to buy from online merchants with good privacy policies and were also willing to pay about 60 cents extra on a $15 purchase when buying from a site with a privacy policy they liked."

20 of 106 comments (clear)

  1. Why privacy matters... by Anonymous Coward · · Score: 5, Insightful

    Privacy is central to our dignity and our basic human rights. Privacy ensures and protects our rights to free assembly and free speech, especially in areas where the governments would seek to curtail these rights. The right to privacy ensures our autonomy in the world and in our affairs. Think of your information as a gift you give to agencies and people you trust. How do you feel when any gift you give is "regifted." How do you feel when something you say in confidence is repeated and spread through your community, whether that is your office of group of friends. How would you feel if a friend gave your phone number out to every person who asked them. How would you feel if a friend revealed an embarrassing medical condition you had or a financial problem you were struggling with. Thinking of privacy in these terms helps you to see why your privacy is an important part of your life.

    1. Re:Why privacy matters... by BadERA · · Score: 2, Funny

      And in other news, water is wet, ice is cold, violets are blue, bears are Catholic and the Pope poops in the woods.

      --
      I am, therefore you think.
    2. Re:Why privacy matters... by WrongSizeGlass · · Score: 5, Funny

      Mod parent up for reinforcing his point by posting anonymously.

    3. Re:Why privacy matters... by Original+Replica · · Score: 3, Insightful

      "At what point does the intrinsic need for privacy override the need to prevent societal decay? "

      Privacy has a lot of grey area to it, and I think different places in that grey area are appropriate in different circumstances. Sexual predators might need to be known to the local police and school officials, but not the media. Politicians' campaign donations need to be known to the media, but are not of special concern to local police. The trick is who gets to decide, what info is databased and shared. If someone goes to the doctor for an STD medication, should that info be attached to their online dating profile? If someone is in Alcoholics Anonymous, should their children's teacher be informed?
      There is a difference between allowing someone's reputation to follow them, and having institutionalzed gossip. But it's a tough call as to exactly where that difference lies. http://yro.slashdot.org/comments.pl?sid=237213&cid =19375351

      --
      We are all just people.
  2. Ridiculuous by Rinisari · · Score: 5, Insightful

    That's ridiculous. Users should expect, no, demand privacy, not have to pay for it. Privacy should already be there, because the user has to trust the company to handle their data correctly.

    I won't trust a company that makes people pay for "extra privacy." That screams distrust to me.

    1. Re:Ridiculuous by BadERA · · Score: 2, Interesting

      You know, that was my initial reaction too. However, I don't think that's the notion that's conveyed by the study -- I'd like to think that it means merchants who protect privacy to begin with are rewarded for it. Unfortunately, I do suspect that this will translate into "how much more can I charge because I post a rigid and thorough privacy policy?"

      --
      I am, therefore you think.
    2. Re:Ridiculuous by mr_stinky_britches · · Score: 2, Insightful

      In a perfect world, you are right, all online retailers should protect our privacy.

      However, in the real world..there are a lot of shady outlets which either haven't bothered to make their privacy policy clear or don't respect the privacy of their customers.

      --
      Censorship is obscene. Patriotism is bigotry. Faith is a vice. Slashdot 2.0 sucks.
    3. Re:Ridiculuous by owlstead · · Score: 2, Interesting

      I'm sorry, but personal data is worth money. So, inherently, the bad companies make more money, even if they sell a little less. This can keep their price down. Of course, I won't buy from them, and I find that good quality service is more or less linear with good privacy. Other buyers fortunately think so as well. So the good companies still have a business case, but they are somewhat more expensive most of the time.

      Just compare it with television. The ones with the most (annoying) commercials make the most money, and have the blockbuster movies first.

    4. Re:Ridiculuous by Bongo+Bill · · Score: 5, Insightful

      It's not that good companies charge more. It's that bad companies charge less, because they have no obligation not to use that information to turn an additional profit.

      --
      ...but is it art?
  3. Advantages of B&M retailers by mbstone · · Score: 2, Insightful

    I just say, I'm going to use my Ben Franklin Card today. If the store clerk then asks for my phone number or email address, I just remind them of the airtight Ben Franklin Card privacy policy.

  4. Newsflash: by Richard+McBeef · · Score: 3, Informative

    People look for the "shipped in plain brown packages" when buying porn related items.

  5. Privacy is temporary, no? by citrusburst · · Score: 2, Interesting

    Isn't the notion of a "company respecting user privacy" illusory? In other words, when you give your private information away, you're not giving it to another person. You're giving it to a corporation. If the management changes, if the shareholders demand a greater quarterly return, the same company can alter their "privacy policies" and sell all the information they like. Sure, a random user can sue, but can they afford the same kind of attorneys as the company? There's an old proverb about "what you whisper in your room will be shouted from the rooftops". I don't think that changes in the internet age. Jed Check out the Ad-Supported Music Central blog: http://ad-supported-music.blogspot.com/

  6. Re:Oh, please by WrongSizeGlass · · Score: 4, Funny

    This study is BS. Purchase a sex toy? How can this study even be valid. How about trying books or something like that? How about buying a book about how to use the sex toy you purchased on the other site?
  7. Privacy is not always temporary by feepcreature · · Score: 4, Interesting

    It varies, depending on to whom you give your information.

    In most of Europe, companies are bound by laws implementing the EU's Data Protection Directive, which makes it clear that your data is not just another asset of the company which collects it, and that companies can only process it for the purposes for which you gave them the data.

    In the US, companies howl with outrage at the prospect that they should treat their customers with similar fairness. You could argue that resisting even the smallest extra expense is in the short term interests of their shareholders. Of course that ignore the possibility that ethical policies may increase customer loyalty, and better serve their shareholders' longer term interests - as well as being "The Right Thing".

    There is a lot of nonsense spoken about "impersonal corporations". Folk forget that it's actual human beings who make the "decisions of the corporation". Some of those people do good and some do evil.

    Maybe they should be held to account?

    --
    Paul "Say no to feeping creaturism"
  8. Where do you get *real* privacy ratings? by schwaang · · Score: 2, Insightful

    I usually read an online shop's privacy policy before buying (along with their other policies). And it's usually legalistic gunk, with a truste logo slapped on, which is worthless given that most policies say "we can change this anytime without prior notification".

    So how do you rate what they _do_ instead of what they _say_?

  9. And the conversation went by Evets · · Score: 3, Funny

    Researcher: Would you be willing to help us out today by answering a few questions and buying something online? We're researching consumer buying decisions as they correlate to privacy policies of internet merchants.
    Woman in Mall: Sure, what do I have to buy?
    Researcher: Just batteries. Oh and a... um... vibrator.
    Woman in Mall: <turns around and walks away looking for security>
    Researcher: But you get to keep it!
    Woman in Mall: Well, I guess if it's for scientific research...

  10. Why copyright matters: by Anonymous Coward · · Score: 2, Interesting
  11. What this means by obeythefist · · Score: 3, Insightful

    Is that now every shoddy internet business is going to have a big serious looking "we care about your privacy" notice stuck somewhere prominent (but not prominent enough to displace advertising).

    They won't change their actual privacy policies or anything, and they'll still leak credit card details etc. to the highest bidders.

    Think I'm being cynical? Maybe. But think about it, this is bound to happen.

    --
    I am government man, come from the government. The government has sent me. -- G.I.R.
  12. Re:Oh, please by Esteanil · · Score: 2, Insightful

    Yeah. Summary of the article: A test group using a special "privacy finder" search engine to shop for sex toys and batteries will pay extra for privacy.

    This clearly leads to the conclusion that all online shoppers care deeply about privacy and will happily pay web shops with good privacy policies much more for the same products.
    Anyone got some statistics from a web shop with a privacy policy? I'd sure like to see how many % of visitors and buyers actually read this policy.
    This should give some indication as to how many think or care about privacy when shopping. My guess would be that this is a depressingly low number, but I'd really like to see some statistics if anyone can supply them.

    --
    I'm a dreamer, the world is my playpen. But hey, I'm a serious person, I can't dream all the time.
  13. Isn't privacy a right? by wikinerd · · Score: 3, Insightful

    Customers pay for service. If they are willing to pay more for privacy, this means that privacy is equated with a service that can be bought. Since then is privacy something you buy? Isn't privacy a right? Should we pay to enjoy our rights? I am afraid that the blatant lack of privacy has made even the customers to abandon the idea that they have this right as an unrealistic romantic ideal and accept the harsh reality that in today's corporate jungle there are no rights and everything can be sold and bought.