“We Traded Our Privacy for Comfortability”: A Study About How Big Data is Used and Abused by Major International Companies

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“We Traded Our Privacy for Comfortability”

A Study About How Big Data is Used and Abused by Major International Companies

Bachelor Thesis

Author:

Adam Manfredsson Madelene Hansson Supervisor: Pär Vasko

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Anonymous 1 – 05/05-2020

Abstract

Due to digitalization, e-commerce and online presence is something most of us take for granted. Companies are moving more towards an internet-based arena of sales, rather than traditional commerce in physical stores. This development has led to that firms choses to market themselves through various online channels such as social media. Big data is our digital DNA that we leave behind on every part of the internet that we utilize. Big data has become an international commodity that can be sold, stored and used. The authors of this thesis have investigated the way international firms extract and use big data to construct customized marketing for their customers. This thesis has also examined the ethical perspective of how this commodity is handled and used, and people s perception regarding the matter. This is interesting to investigate since very few researches has been previously conducted combining big data usage with ethics. To accomplish the aim of this thesis, significant theory has been reviewed and accounted for. Also, a qualitative research has been conducted, where two large companies that are working closely with big data has been investigated through a case-study. The authors have also conducted six semi-structured interviews with people between the age of 20-30 years old. The outcome of this thesis shows the importance of implementing ethics within the concept and usage of big data and provide insight into the mind of the consumer that has been lacking in previous research of this subject.

Key words

Big Data; E-commerce Marketing; Ethic; Deontological; Utilitarian;

Digitalization; Website Cookies

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Acknowledgments

First, we would like to express our gratitude to our supervisor Pär Vasko for his guidance and helpful feedback, and for sharing his insight and reflection with us when we needed it. We would also like to thank our examiner Susanne Sandberg and our opponents for the constructive arguments that has helped us to improve during the process of writing this thesis.

We would also like to thank Linnaeus University of Kalmar for the knowledge that we have been enriched with these last three years, that has helped us built the foundation for our future.

Foremost, we would like to thank Marcus Pettersson, Johannes Karlsson, Sandro Wittwer, David Grossmann, anonymous 1 & anonymous 2, who participated in our interviews for their time and honest opinions.

Kalmar, May 27th, 2020

____________________ ____________________

Adam Manfredsson Madelene Hansson

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Appendices

Appendix A - Table of interviews Appendix B – Interview guide

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Figure and table index

Figure 1 Outline of Theory 9

Figure 2 Conceptual Framework 20

Figure 3 Research Approaches 21

Figure 4 The two ends of big data 48

Table 1 Clarification of the five Vs 13

Table 2 Deontological VS Utilitarian theory 17

Table 3 Operationalization 28

Table 4 Summary table of empirical findings on ethical standpoints 45 Table 5 Summary table of empirical findings on Amazon and Facebook 46

Table 6 Summary table of interviews 70

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1 Introduction

In this chapter you will be presented with a brief introduction of e-commerce and marketing, big data and the way these channels are influencing us every day. This chapter will also illuminate two large theories within ethics in order to explore the moral and ethics behind this growing marketing area. In the end of this chapter a problem-discussion will be presented, which will further highlight the importance of exploring this area further. The purpose and an outline of the theory and methodology will also be present in this first chapter of the paper.

1.1 Background

Shopping online is a constantly growing activity on the internet. In 2019 retail electronic commerce sales was estimated to 3.53 trillion US dollars and by 2022 this sum will be almost doubled (Statista, 2020a). This increasing trend of e-commerce contributes to the growing need and hankering from firms to be represented on a website by digital marketing, which is more contemporary than ever as a result of the worldwide usage of smartphones, tablets and computers (Chaffey, Ellis-Chadwick, 2015). A constant online presence among the people has led to that rules such as the General Data Protection Regulation (GDPR) has been implemented, in order to regulate the ways that personal data is collected and kept. Citing Article.1 GDPR:

“The protection of natural persons in relation to the processing of personal data is a fundamental right. (European Parliament

& Council of The European Union, 2016).

In order to understand and interpret data covering the field of e-commerce and e-commerce marketing we need to understand the concept of e-commerce and what it means. E-commerce is a term used as a description of purchases or transactions of ownership, services and goods on the internet. E-commerce stand for electronic commerce and is widely spread throughout the world. E- commerce is an activity that engages both business to business (B2B), business to consumer (B2C), consumer to consumer (C2C) and business to government (B2G) (Gupta, 2014). This paper will focus mainly on the B2C sector.

1.1.1 E-commerce and online marketing

In conjunction with the large impact of e-commerce, firms spend more money each year on e-commerce marketing. This is an effective strategy to reach the

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largest number of customers in the shortest period of time. E-commerce and e-commerce marketing also enable an extended possibility for firms to expand and gain a large number of new merchants more quickly than in the past. The marketing strategies online is far different from the original marketing methods, in terms of their often highly aggressive methods. The aggression in online marketing can be linked to the high availability for firms to customize and shape their marketing to better fit with the habits of the consumer, in order to target them in the most efficient manner. The most growing online marketing channels at the moment is social media (Herhold, 2018).

An effective marketing strategy is ever so vital to pilot the online traffic and maintain their attention. There are different sorts of marketing approaches to steer peoples in the necessary lane. However, the strategies may be countless, but what all the approaches have in common is that they are all limited to be mostly visually persuading. E-commerce marketing strategies mainly allow the visual sense to be affected, not like other methods used in stores where smell can also be a factor to consider when marketing. Visuals are everything in this marketplace and the competition is ever so harsh, battling each other for the consumers attention span. As previously mentioned, there are multiple strategies used in this particular field, and the major strategies are for instance market affiliation. This strategy contains commercials, banners and pop-up advertisement that by a click transfers the web-user over to another website where the product that is displayed can be bought. Another well-used strategy is the search engine optimization. This strategy is based on searches made in a search engine. It is a more organic alternative due to that the products displayed will be more relevant. And thirdly is the pay-per-click strategy, the company purchase space on websites and the websites creators gets paid for every visitor generated by the advertisement (Good firms, 2020).

One common big data-collecting instrument is cookies. This instrument is used by for example companies such as Amazon to gather information they find necessary about their customers. Data collection through cookies can consist of things such as; if you are new to the website or a recurrent visitor. It can also access your shopping-cart to gain an overview of what items you are interested in, which will be saved into their data-base. Also, all essential information that you have to enter in order to purchase items online will also be collected and saved by the firms. Cookies is a contract that internet-users is often forced to accept if they want to access a webpage online. This data will

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be saved mainly in order to provide customers with online advertisement (Brain, 2007).

Many traditional models of internationalization of firms such as the Uppsala model, highlights the complications that psychic distance bring to the international expansion of firms. E-commerce can in many ways restrain the issues of psychic distance and therefore make the international transition simpler. One of the main factors is that the firms do not engage physically in a market, and their investments in that specific foreign market is not as demanding as it would be by traditional internationalization. The consumer commitment is also different when an e-commerce firm internationalizes. E- commerce customers are usually not as committed to a specific company when the transaction is executed online rather in a physical store. Even if the psychic distance in many ways becomes less influential with e-commerce, the security factor is still argued to be a big potential hindrance. This can be avoided to some extent by looking at the language, payment systems and other factors that is part of the traditional obstacles of psychic distance in traditional models.

But one thing is clear, internet enables a larger platform in which firms can market themselves and build a brand and image in order to create trust among their international customers (Hadjikhani, Safari, Thilenius, 2013).

1.1.2 Big data and ethics

Big-data and ethics are two words you can find together in many situations. It has been widely discussed, mentioning how its existence erases the boundaries between what is private and public (Michael, Miller, 2013). This further strengthen the importance of conducting investigations on the matter. The usage of individuals personal information is spread over the internet when using social media such as Facebook, Instagram et cetera. And previous researchers within this field argues that the increasing usage and sharing of big data and personal information in many ways goes against the traditional ethical and moral obligations and rules of our society (Zwitter, 2014).

Ethics, both the utilitarian and deontological fields are an interesting approach when further investigating the moral and ethics behind e-commerce marketing which will be further examined in the content of this paper. The ethical aspect of firms that collects extensive customer data to further impact their customers purchase and buying behavior, is a field that is still lacking further investigation, which is something that will become mighty indispensable as the e-commerce market continues to grow (Gauzente, Ranchhod, 2002).

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The utilitarian and deontological theories of philosophy is commonly used when wanting to concretize moral and ethics. They both take on different approaches on the term ethics and what makes one act ethically justifiable and what action is not. Utilitarian ethics focus on the consequences of one's actions to determine whether it is ethically justified. Whilst deontological ethics, specifically contractualism focuses rather on the ethics behind the action itself in relation to laws and systems of the society such as GDPR, rather than the consequences these actions brings with it. By examining these theories further there will hopefully be a way of determining whether the extensive data collection customers are constantly being exposed to and targeted by that can further create customized e-commerce marketing, is done in an ethical and moral matter (Gauzente, Ranchhod, 2002).

In the past there have been research done on similar topics within e-commerce and online marketing. Many of them were written when this form of marketing was still in its early stage and there have been very few conducted researches on the ethics behind online marketing in recent time. This qualify for new research to be conducted, keeping the more outdated papers in mind. The early interest in this field further strengthen the importance of further investigation into the ethics behind what companies expose their customers to online. Data collection, being one of the most important angles of incidents of this paper, just like previous researchers have done before (Gauzente, Ranchhod, 2002).

The subject of ethics combined with big data and e-commerce marketing is interesting to investigate as it draws larger academic attention to itself every year, as previously mentioned. E-commerce and big data collection are enabling firms to become international fast and innovation is the keyword of many firms and how their business models are shaped by the usage of big data collection. Amazon is a great example of how big data can be used to exploit the resources and gain new market shares to grow bigger as a firm and find markets in which they can be successfully present. Other online based companies such as Netflix, are highly dependent on big data collection and their growth has been tremendous. Big data collection is a tool that enables quicker internationalization for many firms If used and analyzed properly.

Competitive advantage and insight in customer behavior being two of the main benefits of big data collection, which contributes to the possibility of entering new markets with gained customer and market insight (Mazzei, Noble, 2017).

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1.2 Problem discussion

Data collection is in many ways an easy and cheaper way for companies to get to know their customers. It may not only be negative to collect and use data gathered from the internet, from multiple perspectives it might be good. But there are also downsides to this. As early as back in 2003 researcher could see that misuse of the collected data was going to be more prevalent than with more traditional methods (Adam, McDonald, 2003).

E-commerce marketing is widely used by e-commerce corporations. There are several marketing strategies in place, and some are more questionable than others. O'Neill (2016) writes that big data is a major competitive advantage that large firms use in order to reveal customers patterns and other customer behaviors. Amazon, Netflix and Facebook among others are notorious for collecting big data. BBC News (2018a) states that Facebook were exposed for selling data to other companies such as Spotify, Netflix and Amazon to mention some, that violates the data privacy practices that was not in an agreement with or in the light of Facebook s users. The Guardian (2018) describes how Facebook was exploited by Cambridge Analytica that collected data from over 50 million Facebook-users. The information was used by the analytic firm in relation with the Trump campaign and the Brexit movement.

This data was used to predict voters pattern and influence them for their own personal gain. The information was used to bombard the victims with political propaganda best suited for that particular individual. By doing so people's beliefs were affected, making them vote differently than he/she might would have done otherwise. Facebook later found out about the wrongdoings and failed to take the necessary steps and actions in order to handle this unprecedented breach. This major overstep is a violation against the people that were subjects to this breach. From a utilitarian standpoint this is considered wrong because the outcome of this action was considered unacceptable and a rupture of modern democracy. Furthermore, from a deontological perspective this scandal would also not be meet with praise, but criticism for the reason that tampering with election outcomes is illegal.

Ethics and moral are a wide subject that entails a variety of different aspects and perspectives to consider. Which is why it has been decided to condense this thesis with exclusively focus on the utilitarian and deontological theories of philosophy to narrow down this study and keep it consist. These two philosophies were picked due to its widely use when concretize moral and ethics. But also, because they consist of different approaches regarding what

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is ethically correct and how it is interpreted. The reason for the selection of these two philosophies is due to the straightforwardness and accessibility the two ethics provide but also the obvious connection one can conclude between big data use and how it violates the moral that the utilitarian and deontological theories entails. Furthermore, both the utilitarian and deontological perspective are each other s antithesis almost one could argue. Hence the reason for the selection of the two which is believed to be one of the many factors to make this thesis more interesting due to the contrast in these ethical perspectives.

From a utilitarian perspective collecting big data can be considered wrong.

Utilitarian ethics are based upon the fact that the majority s well-being is central, and that pain is explicitly bad, and pleasure is ultimately good (Quinton, 1973). With this information at hand, we can draw the conclusion that a tool that affect people s voting patterns does not bring joy to the public.

Furthermore, Lindquist (2018) states that individuals should be in control of their own personal data and how it is used. Which means that right was violated in the Cambridge Analytica scandal because the victims were not aware of how their data was used against them. This concludes also the matter on deontological ethics with a contractarian concept. What that entails is that laws should be followed, always (Moore, 2007). Which is not entirely the case in the Cambridge Analytica scandal, which goes to shows how data collection can be misused and is not ethically justified. Big corporations exploit customers frequently by these marketing tactics and big data collecting.

Big data collecting is favorably used in e-commerce marketing and is a current and fresh subject that is questioned and discussed widely in our point in time.

The future of e-commerce marketing and people s privacy and integrity will be affected based on how this question is handled now. Which is why the authors of this study choose to examine and work on this particular subject. It is interesting how this will unfold but also the other different e-commerce marketing strategies that is from an ethical standpoint a better option.

However, other online marketing strategies are also present and used widely.

On social platforms such as Instagram or Facebook, advertisements are disguised as common posts (Perricone, 2020). In addition to this, about 80%

of people that are students cannot tell apart an advertisement and a common news article. Firms are persistent on distinguishing their advertisement from facts and portrait it as legitimate reportage work (Clark, 2016). Fake news is already a major problem society s are facing in modern times and it is highly dangerous. It contributes to making it much more difficult for people to

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actually tell right from wrong, what is real and what is fake. It influences people to be less well informed in a time where knowledge is abundant and highly available for almost everybody (Graham, 2019).

This study aims to mainly help firms to better understand the importance of social responsibility. Ganti (2019) writesf that the aspect of social responsibility has become increasingly popular in recent times. In addition to this, organizations who strives to contribute more to social responsibility must benefit the society and the environment. This study however targets the societal part rather than the environmental aspect. To solve a problem, one must first understand the problem. Which the authors wish to accomplish. It also aims to help consumers to understand for what purposes their personal information is used online. The authors hence wish to spread awareness concerning the exploitation that customers are exposed to.

1.2.1 Problem Definition

Collecting data has evidently become misused by big international companies which may not always be in an agreement with the users or consumers nor in their knowledge. Even though legislations have not become violated in most cases it can still be viewed as immoral from some philosophical perspectives.

Big data plays a vital role in this moral dilemma and whether how it should be used and what actions are necessary for the future is still at a working process.

1.3 Research questions

Big data is collected and stored for many purposes. It is a valuable asset for medical innovation, companies and for governments. With the increased access to internet by WIFI, 3G and 4G network on phones, tablets and computers people are constantly online in their everyday life. It is also a great tool for companies to use in order to store information about their customers, to increase the customer experience and customize marketing and increase sales. But just like anything, you can flip a coin and find a different side of it.

Previous researchers and authors have explained big data collecting as a digital DNA (Michael, Miller, 2013). It shows who you are, what habits you have and what you like to purchase or do online. Based on this, the authors of this paper

want to investigate the following questions:

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RQ1: What is the role of ethics behind big data collection and usage, analyzed through the actions and consequences of its impact and usage?

RQ2: How is big data extracted and used by international companies to create customized online marketing?

RQ3: What is the perception of companies e traction and usage of big data, among the people whom the data is collected from?

1.4 Purpose

The aim of this thesis is to contribute with a more holistic insight into the marketing environment online along with people's perception of big data usage. This thesis also wishes to investigate whether company s usage of big data can be ethically justifiable, by examining the action and the consequences.

Common marketing usage online will be accounted for and investigated in order to analyze the philosophical and psychological impact this has on both the society and the customers that are targeted. The result of this thesis wishes to help companies and the everyday person to gain a deeper understanding of how big data is used and precepted by its targeted audience, and to narrate two opposing ethical theories within this subject.

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1.5 Outline of theory

INTRODUCTION

This chapter contains information regarding a short description of the study of research followed with a background, problem discussion and research questions. Lastly, ending the introduction with the purpose regarding the field of study.

LITERATURE REVIEW

This chapter includes theories that are relevant to the study which will be displayed and presented here. Also, for further use later on when analyzing the empirical findings.

METHODOLOGY

The chapter regarding methodology explains the method used, the method-specific approaches and strategies that are relevant for this particular study. And also explains why by motivating

the choices made.

EMPIRICAL FINDINGS

Here in this chapter the empirical findings will be laid out and also the correspondents interviews and the structure of the conducted examine.

ANALYSIS

This chapter unfolds the results of the empirical findings and correlate it with the theoretical framework with an in-dept examining and observations managed by the authors.

CONCLUSION

The last chapter display a summary and also provide answers to the research questions.

Furthermore, suggesting appropriate measures for future scrutinizing.

Figure 1: Outline of Theory - Own creation

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2 Theoretical framework

This chapter explains the primary theories of philosophy, big data, digitalization and e-commerce marketing. Thus, present necessary information regarding this subject that will later lay the foundation for the critical analysis. It provides clarifications and relevant information that is paramount for this thesis.

2.1 Digitalization

The digitalization started in the fourth upcoming of the industrial revolution.

This current revolution is shaping business executions, industrial environments, the economy and society as a whole. The technological devices have become centralized in this new era and the operating processes is frequently changed due to the rapid development of new technology. New innovations are being created on the saturated technology market in order to stay ahead of the competition and maintain relevance. The purpose of digitalization is to establish new opportunities for societies, and sustainability and value creation is also crucial within this aim (Parida, 2018).

Because of the uncertainty this new concept delivers, it causes implications.

This is most evident in the industry sector. Manufacturers are experiencing a major change in the working-process with technology to ease the working load, and even, the manpower. These probable disparities, wage deflation and the uncertainty among the workforce is all caused by the digital era we have been introduced to. The winner in this aspect is the customer (Parida, 2018) which however is paradoxically. In order for a customer to afford purchasing product or services, the person has to work. But if work is becoming replaced by digital means, then that person does not make adequate capital to afford consuming.

2.1.1 Digitalization of business

Digitalization introduce major changes, especially within the business world.

The scope of business has widened its views, performance has increased along with productivity. This phenomenon consisted of the power to change every organization and is merging the physical and digital world continually. This is required to develop in favor for the manufacturing firms. An example of this would be to use and gather data to create an edge for a competitive advantage.

Business models are facing a transformation and newly invented models are becoming created. A business model is used to pinpoint what value a business

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is creating for customers and how to profit from it. The aspects that is primary altered by digitalization is the customer bond, the internal infrastructure management and also the value proposition (Müller, Rachinger, Rauter, Schirgi & Vorraber, 2018).

The digitalization phenomenon is not exclusively affecting customer needs or the infrastructure of an organization but also the insistence on workers.

Demands for cyber qualifications is necessary and for this reason is the working force up for a challenge where they can meet these requirements. If an organization do not possess these vital resources then they urgently require external support from a party that can supply them (Parida, 2018).

Furthermore, the scope of reaching customers have transformed from a specific geographical matter to global element. Also, the reducing of costs is obvious due to the digitized business. However, the communication aspect of business is essential to nurture the relationship between the costumer and company. Because the customer has the opportunity to search for wished products or services that consists of the wanted desire, corporations have an obligation to provide correct information regarding their offerings. These desires and obligations have increased with the prosper of digitalization and enhance the healthy relationship between the two parties to ensure good communication quality (Patrutiu-Baltes, 2016).

2.1.2 Digitalization of retailing

The digital era is prevailing and has shaped the context of retail permanently.

The undergoing digital transformation have not exclusively created products and services that have adapted to digital form factors, but purchasing tangible product has also undergone a much more effective approach. The emerge of the internet have led to a complete change in the fashion of consumption. New opportunities have risen in the retail sector such as the enhancement of the purchasing process; local stores becoming exposed and accessing the global market with the support of the internet; and also, the creation of intangible products and services for example e-books. Social media has become an open platform for customized advertisement, and the smartphone has transformed to be a part of the purchasing process when shopping online (Egels-Zandén, Hagberg, Sundström, 2016).

Digital devices such as smartphones has become more than a step in the purchasing process, but also a device to gather data, personal information, purchasing patterns and location to mention a few vital contributes to risen shopping behavior. Everything connected to the internet possess similar

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elements compared to the physical store and also other elements that are even more beneficial for the marketer to ensure more selling than the average physical store. Customized advertisement, a simple payment process and an easy price comparison to mention a few, are benefits the online shopping experience offers that the physical store does not (Hagberg et al., 2016).

2.2 Big data

Big data is described as the information gathered from digitized sensors in real time. This is global positioning systems-based location, peoples orienteering patterns when visiting websites, online purchase records, posted images or videos on social media, and almost anything that can be done through an internet connection. This massive volume of data is doubling with every other year. Big data is highly valuable and is considered not only an international commodity but a new structure of investment or capital within the sphere of business. Analytic tools that can interpreted and sort the most paramount information can be mined to create beneficial business opportunities. Due to the lack of these highly advanced analytic tools and the appreciation of data, most businesses miss the full poetical that big data actually can provide (Chen, Guo, Lau & Zhao, 2016).

Big data is characterized in recent time by the five Vs. One V stands for volume. As aforementioned, big data is colossally produced in the quintillion bytes worthiness of data from a day-to-day time period. Another is velocity, the rapid speed of data that is produced is astounding when considering the output of the information in the timespan that it is conceived. It also stands for the speed at which the data can be collected with the right tools. The third V, which is veracity, is referred as the validity and quality of the data. Information is nothing without the right context or with the correct information whether it is trustworthy or not. Variety is given considering different sources creates more validity and ensure the quality. The more different sources claim the same statement, the higher tends the adherence to be in general. The fifth and final V is value. When data is correctly assembled it can construct actionable knowledge that benefit the collector. The end result of gathering data is that it culminates into a monetarily profitable action (Chen et al., 2016).

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Table 1: Clarification of the five Vs - Own creation

2.3 Cookies

The usage of cookies is plentiful and consist of a variety of opportunities, but also risks. The functionality of cookies is to store information regarding the user. The information is the browsing activity, written information into forms and whatnot. A cookie is created when some information needs to be stored in order to always maintain the current state of the web session. A cookie scheme should provide four different sorts of services. It should ensure authentication.

A valid cookie is used to automatically fill in user s name and password.

Confidentiality is another service cookies consists of. It ensures that only the server can read the cookie if the cookie is of high-level confidentiality, otherwise it can also be read by the client. Integrity involves whether the cookie will notice of it has become modified or not. Lastly is the Anti-replay service that notice if a cookie has been stolen and replaced by a replica (Gouda, Kovacs & Liu, 2012).

Cookies can be used for different purposes like targeted marketing and to track users. Because cookies are flexible and can therefore be misused in the favor of an advertiser. An advertisement banner can contain a particular identifier for cookies. What this does is to create a profile based on the other cookies it is able to read. Cookies should be provided with the four elements aforementioned but is however not arranged to formally function this way when they were firstly introduced. It is up to the server to provide a working method and some servers is better than others. Most sites that use cookies do not prevent the practices of forgery steal, even though they collect sensitive information like passwords. Cookie schemes that tries to prevent cryptanalytic

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attacks still fail due to cookies not being built to withstand those challenges.

For these reasons and more is why cookie-based authentication is problematic (Sit, Fu, 2001).

2.4 E-commerce marketing

One might wonder what e-commerce marketing is and what distinguish that type of marketing from traditional marketing strategies. Here the authors will discuss the definition and the strategies used in order to comprehend everything worth knowing concerning the subject.

E-commerce marketing is present in all sorts of digital forms in order to reach the highest number of potential customers. These digital marketing places can be social media, search engines and other forms of digital means. E-commerce advertisements are highly successful to draw customers attention and provide brand awareness throughout the internet. Different sorts of advertisements exist, such as banners, media advertisement and more. As previously mentioned, social media is a great platform in order to build a brand and spread awareness. This is especially effective for the reason that customers will willingly connect and follow the content of an organization they are already interested in, but also to find new customers. Furthermore, to eliminate agitation and make the shopping experience user-friendly and more rapid, firms are using social media as a tool that can turn their posts into shoppable content and create a way for customers to more easily access the content that is displayed instantly. This is a service that Instagram and YouTube provide, to name a few. YouTube is a major marketing place for firms to explore with over a billion users, customers are not as distant anymore. Creating videos and sponsoring content with YouTube's creators opens up a lot of opportunities (Perricone, 2020).

2.5 Philosophy

What philosophy are is very subjective. There are a lot of answers to what philosophy is, but none of them could be viewed as more correct than another (Munro, 2012). According to some source s philosophy is the science in which a person is critically examining questions of life that does not naturally have any given answers to them, one might be what moral and ethics are (Prawitz, Haglund, [N/d]). Below, two of the philosophical theories of ethics will be described and accounted for; deontological and utilitarian theories and principles.

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2.5.1 Utilitarian ethics

The father of modern utilitarianism was a British jurist and philosopher who lived during 1748-1832 named Jeremy Bentham (Sweet, [N/d]). Utilitarianism strives to affect the majority of everybody and also result in the absolute best outcome possible. Utilitarian ethics origins from consequentialism that entails to establish the maximum utility and happiness for people everywhere.

Utilitarianism consists of two different branches. Firstly, the hedonist principle that subsist on the convention that pain is explicitly bad, and pleasure is ultimately good. Secondly, is the consequentialist principle entails that the outcome of an action is determined good or bad based on the result (Quinton, 1973).

Furthermore, Quinton, (1973) writes that, what differentiates utilitarian ethic practices from its other related embodiment based on consequentialism such as altruism and egoism is that utilitarianism favors every human equally, impartially considering other aspects to ensure that everybody is justly judged based on right and wrong doings. In addition to this, choosing not to act can also be viewed as a morally good or bad deed depending on the effect it has on the general happiness. Or if the inaction diminishes any suffering that is caused to the general. The outcome and consequences of these activities will determine if the deed is good or rather bad. The general influence is of the greatest importance in this aspect.

Moreover, utility in this context is the pleasure one experience from performing good societal deeds and the best outcome for the society is the best pleasure and therefore the best action one can possibly commit. However, people will always be bias and select a pleasure greater than the other based on experience and quality of that feeling. People who are competently acquainted with multiple pleasures will favor one over the other. Meaning, these competent judges will not hold strong for every case resulting in the majority s final judgement to rule over any other method of judgement for what is most right and most pleasurable (Quinton, 1973).

Hence, what is considered wrong and bad in this aspect? Well, everything that is a detract from the general s well-being is considered wrong and not at all a utility. Resulting in the public's wellness to be an obligation and a duty rather than performed for the sake of perpetrate a good deed. This is paradoxical on two levels and the other one will be discussed further on. Firstly, this is mainly a paradox because humans cannot be expected to know every outcome of

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every decision in order to please the majority of the people affected, based on every decision made. Then by that logic, every human on this earth is non virtues or evil. And how can people be considered evil for their ignorance about future events? Humans are not omnipotent and can therefore not be judged based on matters they cannot control (Quinton, 1973).

2.5.2 Deontological ethics

Deontological ethics theory can be described as the direct opposite of consequentialist theories, in which utilitarian ethics is part of. Deontological ethics theory is not based upon the consequences that one's actions bring with them, no matter how moral the intention and outcome might have been.

Deontological ethics is rather based upon the theory that the moral of one's actions is a result of the obligation one had to pursue. Furthermore, this means that within the deontological theories the intrinsic value; or the ethical norms, is the determining factor that designates whether an action has been made in accordance with one s moral duty (Moore, 2007).

Just as utilitarian ethical theory, the deontological ethical theory has a few branches. They all serve the same core-value but undertake different approaches and subjects of the matter from one another. This report will be focused on the contractarian concept of the theory. Hence, it contributes with the most pertinent content for the purpose of this paper. Contractarian deontological theory is commonly referred to as kantian. This phrase leads back to Immanuel Kant, that is still a central figure in modern philosophy (Rohlf, 2020). This part of deontological ethics is very focused on the morality and ethics behind actions in relation to social principles. An action is, according to contractualism ethically justified if they are transacted in accordance with these social principles. Thereby, actions that contradicts these restrictions can therefore not be viewed as morally justified. Examples of actions that would never be morally justified through contractualism are murder. By murdering someone you commit a crime against law, hence social principles. This act can never be justified no matter how many people that would favor from this person's death, if comparing with utilitarian ethics (Moore, 2007).

Deontological ethical theories are somewhat paradoxical. The far most blinding dilemma with these theories, are that they justify actions and behavior that in many ways are portrayed as immoral but yet moral in accordance with framework of the theory. It is argued that deontological theories require a more

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consequential way of judging the moral and ethics behind actions, to gain rationality (Moore, 2007).

2.5.3 Table of Deontological VS Utilitarian theory

Table 2: Deontological VS Utilitarian theory - Own creation

2.6 General Data Protection Regulation (GDPR)

General Data Protection Regulation (GDPR) is a regulation that became effective the 25 th of May in 2018 and replaced the older regulation from 1995. It regulates the way private data is collected and handled online inside of EU. GDPR does not only affect the private data of citizen and companies when they are present inside their home country in EU, its effects are also present when a company outside of EU does business with a member state or citizen. This means that the regulation has an impact on the business environment on the internet on a global scale and affects not only the type of

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data that companies are allowed to collect and store, but might also affect the way companies design and use their databases as well as how the development of internet usage and e-commerce will proceed in the future (Greengard, 2018).

One of the possibilities that GDPR enforced was the possibility for people to gain control over their private data and how much of it they were prepared and willing to share online. This also led to a possibility for citizen to remove data or even sue companies that they felt had crossed the lines of this regulation.

Companies on the other hand might argue that this regulation does not protect the citizen, but rather inhibits the development and growth of digitalization and innovation of the future, that is highly dependent on collecting customer data (Greengard, 2018).

One of the changes that GDPR bring in comparison to the data regulations from 1995, is the definition of personal data itself and thereby what can be considered a violation of people s privacy and a violation of freedom of EU- citizen. GDPR mentions that any information that can be used to identify an individual no matter if it is done directly or indirectly is to be considered personal data and is therefore controlled by GDPR. GDPR is only applicable when it concerns the personal data of a living breathing person. This means that corporations or institutions et cetera cannot be viewed as an individual and their data is therefore not considered personal data. Data collecting instrument such as cookies is one of the resources that is now considered to generate and store private information and thereby affected by this regulation (Tankard, 2016).

2.7 Business ethics

Business ethics is a common and popular topic to discuss and debate about. In order to understand business ethics on a deeper level, one must understand what a business and ethics really are to combine them correctly. The word business is generally used when describing companies, firms, and organizations that foremost has an aim to make profit (Jones, Parker & ten Bos, 2007). This is also what the word business will be referring to in this thesis.

Ethics is a bit harder to explain but as previously mentioned it can be explained as the blind spot of laws, regulations and systems. It is also highly subjective what one might view as ethically justified and not. There are plenty of theories

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about this, two of them has previously been mentioned. To conclude what business ethics are you can regard it is a combination of mixing the laws and regulations of a business with common sense and the will to do what you think is right (Jones, Parker & ten Bos, 2007).

Business ethics as a concept can be quite tricky to concretize. One way to explain business ethics as an entirety is that the business ethics becomes relevant where the laws and regulations has their blind spot. To further exemplify this, the best way is to investigate laws and regulations of a specific country and compare this to the way companies act in relations to this. A law can never forbid everything, and it is then up to the ethics to come in to play in the business environment (Crane, Matten, 2004). When discussing business ethics, it is important to know that there are multiple forms of it. Business ethics can be discussed in relation to feminism, a sustainable environment, working conditions et cetera. Kaptein (2017) argues that there are several struggles related to business ethics, and a person within an organizations possibility to act ethically justifiable. He also mentions that as humans we are constantly tempted to behave unethical when we are driven by temptations.

An example of this could be money from generating new customers and increasing profit from big data, as will be the topic of focus of this thesis.

Social responsibility could be argued to be a part of business ethics. For business leaders/owners it is nowadays much more important to value the customer, employees, ethics, responsibility and other traits rather than focusing on straight up revenue. If a company chooses to focus on the ethics behind their decisions it might actually make it simpler for them to reach the financial top. Employees and customers respond more positively in terms of commitment and satisfaction if a firm chooses to act with a higher level of social responsibility incorporated into their business actions (Joyner, Payne, 2002).

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2.8 Conceptual framework

By examining the theory within the theoretical framework, the authors have discovered that there is a connection between the usage of big data and all its components, and ethics. Yet there are much to be further discussed and discovered within this field. The authors believe that big data connects the law and the human behavior. The online environment is like a world in itself where law and order are mixed with human emotions, which both have an impact on the human behavior through influences and experiences created within this world. Where each actor must decide who they want to be online in order to act ethically justifiable. These connections will be concretized within the model below.

Figure 2: Conceptual Framework Own creation

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3 Methodology

In this chapter, the applicable method will be presented in order to compose this thesis. First and foremost, the research approach followed by the design, technique, quality of research and more. An overview table of operationalization will also be presented in this chapter. Lastly. The research ethics and the authors contribution will be conferred.

3.1 Research Approach

There are three main research approaches which is inductive, deductive and abductive reasoning. The inductive reasoning is heavy based on inductive logic that draws a conclusion based on specific data. This specific data is supposed to be generalized in order to provide an explanation (Bradford, 2017). Harshly explained one could state that if a coincidence occurs that gives the same results multiple times, then the conclusion is that everything behaves likewise. For this reason, the inductive reasoning can be a bit misleading. A path to conclusion from a statement may sometimes not be logical even though every premise in the given statement is true. Bradford (2017) states that this reasoning is often used in situations that demands a more specific approach.

The deductive reasoning is however the opposite from an inductive approach.

It starts were the inductive ends and ends were the inductive starts. What this means is that the deduction observes a general and broad statement and try to minimize it with a specific conclusion. The third and final reasoning is the abductive form. In a case of non-sufficient explanation, one has to make an educated guess based on the best knowledge available. The starting point through this approach is to approach the best formulated explanation available from a bunch of observations (Bradford, 2017).

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This study however will have an inductive research approach in order to overcome the issues regarding the other two alternatives to make the best generalized result as possible. The most traditional way of bringing together the usage of theory and the research one conduct are most commonly a deductive reasoning mainly used in quantitative studies. And inductive method mainly used in qualitative studies (Bryman, Bell, 2017). This thesis will be done through qualitative methodology, with an inductive approach. According to Bryman and Bell (2017), the deductive approach consists of theory- observations and then result. In the inductive approach the observations and results come before the theory. The inductive approach is therefore mainly based upon that a researcher draws conclusions based on observations which summarizes the research approach for this paper.

3.2 Research Method

There are two different research methods to approach which is quantitative or qualitative method. The qualitative method is used to dive more in-debt when examining an issue or opinion. The techniques vary from unstructured to semi- structured when collecting material through this method. Collecting the material also varies all from focus groups to individual interviews. In addition to this, the volume of participants is considerably small and most often selected rather than randomized. The quantitative research method is however executed in a different fashion. The data collected is designed to be better transferred to either numbers or data that can be used in statistics. Defined variables such as behavior or opinions to name a few, are data that is collected and then generalize the result of a whole sample population. It can be explained to be used in order to find patterns. For these reasons it is more structured than qualitative method. Also, to gather data that method uses closed-ended questions in surveys in all sorts, like paper survey or kiosk surveys (DeFranzo, 2011). The disadvantages with a qualitative research method are favorable to remember in order to avoid them more accurately. Green Garage (2019) states that a subjective quality will always be present and cannot be averted in a qualitative research method. Some perspectives will be considered more paramount that others. It is also highly time consuming to analyze all material that has been collected. It is also not as structured or statistical than the counterpart, but it provides a broader perspective which the authors believed would be crucial when conducting a thesis about perceptions and ethics of big data.

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3.3 Research Design 3.3.1 Research strategy

A case study strategy entails empirical inquiries that scrutinize an issue in real life. It examines social issues thoroughly and consist through systems, companies, governments, people, either in groups or individually and more. It is a highly descriptive analytic tool to use when these characteristics are required to be presented from an event or person. It can also be used for not exclusively one case study but for multiple evidences or sources (Bryman, Bell 2017).

However, this study will contain case studies involving two major international corporations which are Amazon and Facebook. It will focus on how Amazon and Facebook are collecting data, what they do similar and different, how they collect data and whatever purpose they are using it for. An analysis and comparison will be contrived regarding the two. This will be depleted to answer RQ2 of this thesis regarding how international firms extract and use big data. Furthermore, people's perception will also be used through the support of interviews in order to answer RQ3. Moreover, in order to answer the RQ1 of this study, information will be conducted with the help of volunteering interviewees, with the aim to obtain various behaviors and opinions to examine the answers to the question whether the usage of big data can be morally justifiable.

3.4 Material collection technique

Interviews will be conducted with six people within the age-range of 20-30 years old, since this customer group are within the crowd that most frequently uses e-commerce, at least within the EU. This group is most likely to be exposed to the most customized e-commerce marketing based upon big-data collection (Eurostat, 2020). These interviews will be conducted, by using a semi structured interview strategy. This way of conducting interviews is when you ask all interview participants the same questions with some restrictions of enabling the interviewee to further explicate when it feels necessary. This way of conducting interviews simplifies the compilation of answers in a structured manner, though it still gives the interviewer the space to ask follow-up questions if they feel this is important for the result (Bryman, Bell, 2017).

The interviewees will be selected through a convenience sample, which means that the selection of participants is made based upon what is most convenient

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for the interviewers (Bryman, Bell, 2017). As previously mentioned, the interviewees will consist of people between 20-30 years old. Another way of narrowing down the group is that the participant will mostly be students of Linnaeus University of Kalmar. The interviewees will be both Swedish and international students, to avoid cultural similarities affecting the result of this thesis. Half of participants will consist of international students. It is common amongst students to purchase products or services, such as literature through e-commerce which the authors know by personal experience. The interviews will be separate for the simple reason that the individual perspective is more important in this study in order to avoid peer pressure and tempered opinions.

Thus, the decision to not use focus groups, but also for its irrelevance. When purchasing online, the authors believe from own experience that online shopping is carried out alone more often than in groups. Hence the decision to proceed the interviews separately.

This thesis will use a case study design that will be carried out together with the qualitative study that will be used, as mentioned before. A case study is usually focusing on one person or a smaller specific group- in this case mostly students of Linnaeus University of Kalmar in the age between 20-30 years old. A case study is a commonly used design when conducting a qualitative study but can be used in quantitative studies as well. Some researchers argue that there are three different approaches to a case study. Internal case-study, instrumental case-study and case studies that accommodate multiple cases. In this thesis both the internal and the instrumental case studies will be used to some extent, since particular situations and organizations will be examined together with an overview of ethical theories, to get a better understanding of information that lays down a foundation about the reality (Bryman, Bell, 2017).

3.4.1 Selection

The research selection of a study can has different approaches. Either the researchers can choose to use a non-probability selection or a probability selection. This could differ depending on whether the study is conducted through a qualitative or a quantitative method. A non-probability selection is most often used when conducting a qualitative study, probability sampling is most often used when conducting a quantitative study. This study will be using a non-probability selection method, focusing on case studies and convenience selection by interviewing mostly students from the Linnaeus University,

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which are both part of the non-probability selection method of the qualitative research method (Wolf, Joye, Smith & Fu, 2016).

How to differ probability selection from non-probability selection is mainly by the characteristics that within probability selection each person of a population has equal chance of being chosen for participation in the study.

While in non-probability selection, each person does not have the same odds due to, for example that the researcher is using convenience sampling which might mean that they choose participants based on geography et cetera (Wolf et al., 2016).

One major potential downside with using non-probability selection is that it might be difficult to know if the chosen participants are in fact representing the population correctly (Wolf et al., 2016). In this study the researchers have been focusing on a specific segment, based on people that are in the age where online presence and e-commerce are statistically most frequently occurring.

And six interviewees have been chosen to represent this segment in whole.

3.4.2 Interviews

When conducting an interview, it is important for the interviewers to have a clear picture beforehand of what they want to achieve with the interview. One of the main parts of this is obviously the questions. As previously mentioned in this chapter, the interviews of this thesis will be carried out in a semi- structured manner. Which mainly refers to that the researchers have their starting point in an interview guide with standard questions which all interviewees will be asked. The difference between a semi-structured and structured way of conducting the interviews are that in the semi-structured approach, the researcher has the opportunity to put the questions in a different order, or even as follow-up questions as a way to conduct further information they find important (Bryman, Bell, 2017).

Due to the ongoing situation in the world, in relation to COVID-19, the researchers do not find it possible or appropriate to conduct personal interviews where the interviewer and the respondent meets face to face.

Instead the interviews will be conducted by using technological video-aids such as Skype or Zoom. This will make the interview more personal and exclude the risks of important signs that the respondent may give the questioner unintentionally and become disregarded. Signs such as face expressions revealing that the interviewee may not understand the question

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that they have been given can risk being overlooked, which is a common problem amongst telephone interviews (Bryman, Bell, 2017). Of course, the usage of Skype and Zoom could potentially be problematic due to causes such as bad internet connection or the lack of body language that is still a present threat to the researchers interpretation of the participants answers.

Since the authors of this thesis will have had previous contact with most of the respondents, there is no concern about the ability to obtain quality based and trustworthy answers. Also, the probability and opportunity to receive participants that are willing to be interviewed is high. The authors previous relations with most of the respondents, as fellow student of the International Business Program of Linnaeus University, could possibly result in protracted interview session which in some cases could lead to an arising disinterest from the respondent s side (Bryman, Bell, 2017). However, the researchers of this thesis do not believe this will become an issue. The researchers believe that their previous relationship with the interviewees will be an asset rather than a hindrance in receiving honest responds with a high degree of reliability.

3.4.3 Vignette questions

Vignettes are most commonly used when conducting an interview with closed questions. Meaning that the respondent already has a couple of optional responses to the question. The authors of this thesis have however chosen to use this type of strategy in the last part of their interview even though the majority of the questions will be open. A Vignette is usually when the interviewee gets a few scenarios presented to them in which they take statement in relation to how they would have acted if they found themselves in that specific situation. This kind of questions are commonly used when asking questions regarding moral, ethics, values and so on. The respondent is put in a situation in which he/she has to react to a hypothetical event, by doing this, the researcher has a way to communicate otherwise delicate questions that the respondent might would have been reluctant to answer. This technique allows the interviewee to distance himself/herself from that specific situation since it does not involve them personally (Martin, 2006).

This thesis will have to communicate some questions that might feel like sensitive subjects for the respondents to answer and covering certain philosophical realities that could otherwise be hard to communicate without putting them into context. Vignettes was chosen as a suitable technique when approaching those theories.

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3.4.4 Open- or closed-ended questions

The difference between an open-ended and closed-ended question is the result it conceives. A closed question does not demand from answerers more than a one-word response. This one-word is usually “yes” or “no”. An open-ended question however demands a far more motivated and complex answer that only one word cannot provide. It does not however necessarily mean that closed questions cannot be complex, but the answer is only in one word (Your Dictionary, N/d).

This study will be exclusively focusing on open-ended questions for the necessary means of lengthier explanations. Your Dictionary (N/d) writes that in order to extract a more in-dept response, open-ended question is best suited for that particular task. Also, the decision not to use any closed-ended questions is for its irrelevance and subtraction of contribution it brings to this research. It also keeps the theme consist and more inline rather to mix open- and closed-ended questions.

3.5 Operationalization

Operationalization is the segment of a research study that describes the transition from the theoretical framework and findings into something empirical. The word operationalization is a word that is originally common within physics and among physicists but when writing a thesis such as this one, the word is used to describe the way you make something measurable (Bryman, Bell, 2017).

The operationalization table below has been designed in order to give the reader a better overview of how the content from the “theoretical framework”

is shaped and translated into parts of the interview. To receive the needed information from the respondents to be able to obtain answers to the research questions. Apart from using the theoretical framework as a foundation for producing the interview questions, some data from the empirical finding from previous researchers has been of interest to further create suitable topics for the interview questionnaire. The questions will be accounted for down in table 3.

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3.6 Quality of research 3.6.1 Validity

Validity is meant to measure accuracy; how adequate the result is compared to reality and measure what is supposed to be measured. However, it is not enough on its own. Valid does not equal reliability. Furthermore, validity can be separated into two sections, internal and external validity. Internal validity consists of how well an element is similar to the reality. While external validity is rather comparable in other environments or replicated in different circumstances (Dudovskiy, 2018a).

Table 3: Operationalization - Own creation

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