Online Behavioral Advertising: A Literature Review and Research Agenda

TL;DR

This paper reviews online behavioral advertising (OBA), defining it, summarizing empirical findings, proposing a framework for consumer responses, and outlining a research agenda and policy implications.

Contribution

It provides a comprehensive definition of OBA, integrates empirical findings into a unified framework, and develops a research agenda for future studies.

Findings

Consumer responses depend on advertiser-controlled factors.

Consumer perceptions and knowledge influence OBA effectiveness.

Theoretical perspectives are integrated into the framework.

Abstract

Advertisers are increasingly monitoring people's online behavior and using the information collected to show people individually targeted advertisements. This phenomenon is called online behavioral advertising (OBA). Although advertisers can benefit from OBA, the practice also raises concerns about privacy. Therefore, OBA has received much attention from advertisers, consumers, policymakers, and scholars. Despite this attention, there is neither a strong definition of OBA nor a clear accumulation of empirical findings. This article defines OBA and provides an overview of the empirical findings by developing a framework that identifies and integrates all factors that can explain consumer responses toward OBA. The framework suggests that the outcomes of OBA are dependent on advertiser-controlled factors (e.g., the level of personalization) and consumer-controlled factors (e.g., knowledge and perceptions about OBA and individual characteristics). The article also overviews the theoretical positioning of OBA by placing the theories that are used to explain consumers' responses to OBA in our framework. Finally, we develop a research agenda and discuss implications for policymakers and advertisers.