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Getting Accurate Information from Online Customers

As companies request more personal data from their website visitors, people become increasingly protective of the information they share.

(originally published by Booz & Company)

Consumers’ Rules of Engagement in Online Information Exchanges

Amit Poddar, Jill Mosteller, and Pam Scholder Ellen

Journal of Consumer Affairs, vol. 43, no. 3

Date Published: 
September 2009 

It’s not uncommon for Internet users to enter fake e-mail addresses or contact information when filling out forms online, especially when dealing with new or unfamiliar websites, and this false information has been harmful to websites, advertisers, and the economy at large. Overall, researchers estimate that inaccurate information such as falsified or incomplete accounts and errors in customer data management equates to US$600 billion lost each year, or about 5 percent of the United States’ GDP. This paper finds that as businesses request more detailed demographic and purchasing information, online customers often react by limiting the personal data they will share. When customers don’t see the benefits of providing accurate information, they are increasingly likely to provide inaccurate or incomplete data, “getting back” at companies they deem too aggressive or untrustworthy in their data-mining techniques. 

The study was based on in-depth interviews with online users ranging in age from 20 to 74, all of whom were carefully selected to reflect diverse Web experiences. Their online habits included shopping, banking, e-mailing, gaming, social networking, blogging, information searches, and work-related use. The authors found that concerns over privacy and identity theft had made customers wary of disclosing sensitive information, especially Social Security numbers and phone numbers. If a website was unfamiliar or looked unprofessional, consumers were more likely to leave the site than to provide any personal information or to make a purchase. And when confronted with requests they thought were annoying or intrusive on a site they wanted to use, consumers said they might respond with false information such as disconnected phone numbers, outdated e-mail accounts, or pseudo-identities in order to continue using the site while withholding their identity.

The authors found that long-term relationships between customers and companies helped build trust, especially if the first interactions occurred offline, which in turn contributed to the amount of information customers were willing to share online. The study suggests that marketers who avoid asking for too much information before building a relationship with their customers will likely improve the overall quality of the customer data they do collect. 

Bottom Line:
Consumers who trust online businesses will be more likely to provide personal information through company websites, but businesses that ask consumers to share personal information before building trust could end up with inaccurate or incomplete data.

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