Regulating Privacy Online: The Early Impact of the GDPR on European Web Traffic & E-Commerce Outcomes
30 Pages Posted: 18 Jul 2019 Last revised: 31 Jul 2019
Date Written: July 17, 2019
In May 2018, the European Union began enforcing the General Data Protection Regulation (GDPR), which endowed EU citizens with new personal data rights and imposed new responsibilities on firms. Privacy regulation increases the firm’s cost of collecting consumer data which makes matching with users more costly. As such, the GDPR has the potential to reduce both the amount of traffic to a website as well as the amount and quality of web outcome data stored for analytics purposes. We examine the impact of the GDPR on European web traffic and e-commerce sales using web analytics data from a diverse set of 1508 firms that use the Adobe Analytics platform. Using a difference-in-differences approach, we show that recorded pageviews and recorded revenues fall by about 10% for EU users after the GDPR's enforcement deadline. The extensive margin drives these changes as a user's average time on site and average page views per visit stay constant. Future work will leverage last touch attribution and compliance data to better understand to what extent marketing and compliance behaviors are driving these results.
Keywords: Privacy, Regulation, EU, GDPR
JEL Classification: D04, K20, L50, L51, L86, M31, M38, O38
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