Digital User Segmentation and Privacy Concerns

How valuable, and at the same time, how respective of privacy is the Web? This paper uses conjoint techniques to assess how online users make the trade-off between use of free online applications and the desire to protect their privacy. While a large number of Web users are indeed greatly concerned by cyber-privacy issues, we find that the value users are willing to pay to ensure their privacy protection is only several euro per month – an order of magnitude below the value users extract from using currently mostly ad-based, free online applications such as Facebook, Google, and many others. We further show that value for privacy is not homogenous in the online user population. We identify seven segments with different trade-offs between the value of cyber-privacy protection and use of online applications