Should digital marketing practices be more transparent? An empirical investigation on the roles of consumer digital literacy and privacy concerns in self-service technologies

The growth of self-service technologies has led to an increasing demand for transparency. More and more services are delivered online and require that, in this information asymmetry situation, customers overcome their lack of technical knowledge and risks associated with their personal data disclosure and dissemination. This article proposes a three dimensional conceptualization of digital transparency (objectivity, limpidity, openness) and examines how customer's digital literacy and privacy concerns influence the way they perceive their provider's transparency and, indirectly, their engagement to their provider. Based on an empirical research study in e-commerce (N=445), this research demonstrates the differential effects of objective and subjective digital literacies on perceived transparency and examines how customers' privacy concerns lower each dimension of perceived transparency. Finally, since each dimension of perceived transparency actually influence customer engagement, this paper urges firms to pay a specific attention to customer segments with a lower digital literacy and a higher concern for privacy.