Reactance to Personalization: Understanding the Drivers Behind the Growth of Ad Blocking

Abstract

Fueled by advancing technologies that continually expand Web data tracking and aggregating capabilities, online advertising has become increasingly personalized and pervasive. This trend is largely responsible for a growing number of consumers (more than 615 million worldwide) choosing to install ad-blocking software on their computers and mobile devices. As a result, U.S. publishers and advertisers estimate that ad blockers cost them more than $28 billion in revenue in the first half of 2017, and this figure is forecast to exceed $35 billion by 2020. Rooted in a theoretical foundation of psychological reactance theory (PRT), the present study examines key cognitive and affective factors driving consumers to reject personalized advertising messages and install ad-blocking software. A structural equation analysis reveals privacy-related threats, along with benefits rooted in relevance and rewards, moderated by the type of data being used to personalize advertising messages, are contributing to this shift in consumer attitudes and behaviors. Based on these findings, the authors propose important theoretical extensions to PRT along with useful practical implications for advertisers.