The paradoxical role of relationship quality on consumer privacy: Its effects on relinquishing and safeguarding information

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AbstractConsumer privacy has received substantial attention recently due to increased cases of data breaches and other violations that have reduced consumers' confidence in companies. When consumers adopt protective actions to safeguard their privacy, they limit marketers' access to essential consumer information needed for relationship marketing. Strategies to encourage information disclosure have not been explored widely in the literature, nor have consumers' responses to privacy violations. This paper fills this gap by exploring the role of customer‐firm relationship quality (RQ) in consumer privacy. Specifically, the potentially positive role of RQ is examined, as it is proposed to enhance consumers' intentions to disclose information, and, relatedly, to mitigate their propensity to safeguard information. Furthermore, the potentially negative role of RQ is also explored in the context of a privacy violation. Two scenario‐based online experiments were conducted, where RQ and privacy violation were manipulated, and data were analyzed via SEM. The findings demonstrate that a deep consumer‐firm relationship increases intentions to relinquish information and decreases intentions to safeguard information, moderated by the consumer's disposition to value privacy (DVP). However, after a privacy violation, a deep relationship can backfire. Not only do our findings demonstrate that a violation leads to perceptions of betrayal, but the positive effect of betrayal on safeguarding is stronger for those in a deep relationship. Thus, relationship quality has a paradoxical effect: On the one hand, high‐relationship quality promotes relinquishing behaviors, but on the other hand, in case of a privacy violation, high‐relationship quality increases safeguarding behaviors.