An Empirical Examination of the Effects of Web Personalization at Different Stages of Decision Making

Abstract

Personalization agents are incorporated in many Web sites to tailor content and interfaces for individual users. In contrast to the proliferation of personalized Web services worldwide, empirical research on the effects of Web personalization is scant. How does exposure to personalized offers affect subsequent product consideration and choice outcome? Drawing on literature in human-computer interaction (HCI) and user behavior, this research examines the effect of three major elements of Web personalization strategies on users' information processing through different decision-making stages: personalized content quality, feature overlapping among alternatives, and personalized message framing. These elements can be manipulated by a firm during implemention of its personalization strategy. A study using a personalized ringtone download Web site was conducted. The findings provide empirical evidence of the effects of Web personalization. In particular, when users are forming their consideration sets, the agents can play a role in helping users discover new products or generate demand for unfamiliar products. Once a decision has been made, however, the personalization agent's persuasive effects diminish. These results establish that the role of personalization agents changes at different stages of users' decision-making process.