Digital asymmetry - How impactful is the dominance of online intermediaries over their users?

by Aleksandra Dymacz

The dominance of digital platforms over their users is a fact that has become a part of our daily lives. Apps such as Tik Tok very effectively persuade their users into making impulse purchases - a tendency that is visible across all types of age groups, with children being put in an especially vulnerable position. The functioning of online intermediaries can be based on various objectives, with many aiming at the selling of goods or services and providing digital content. In order to achieve such aims, the structure of these platforms is adapted to maximise profits by stimulating the largest number of interactions between users and traders. In fact, currently, most of the popular platforms such as Facebook or Tik Tok are data-driven. This means that the data gathered on specific individuals is extremely valuable - as the more data accumulated, the more accurate can the psychological model of a person be. Having such psychological insight, allows platforms to use persuasion techniques e.g. involving the use of recommender systems that can manipulate consumers into making purchasing decisions that they had no prior intention of making. The phenomenon encompassing such dominance is digital asymmetry. This blog post will analyse what is digital asymmetry, how is it created and what implications does it have for consumers.

What is digital asymmetry?

Consumer rights organisations have been advocating for the concept of digital asymmetry, as a phenomenon describing the enormous disadvantage that consumers are being put at within data-driven environments. This is largely created by choice architecture, which describes the structure of online environments, with certain built-in options that nudge internet users into making pre-planned choices. This type of architecture is largely present in the majority of digital platforms that use ‘feeds’ for presenting content. Essentially, the structure of such platforms is different for every user, which creates a very personalised experience that can be easily exploited by platforms to affect consumer autonomy.

How is digital asymmetry created?

Emotional manipulation is often used by digital platforms to gain the most attention from individuals, in the forms of clickbait, rage baiting and profiled advertising. All these forms of practices are based on a high degree of personalization, facilitated by the personal data gathered on each user. This especially creates the extent of domination enjoyed by the online intermediaries over their users and is variably different from offline settings. For example, a person walking into a physical store may be subjected to different types of nudges by hearing advertisements on the speakers, seeing different offers on screens and being persuaded into buying a certain product by store employees. However, the extent of persuasion is much larger online, as by gathering data on each, a personalised psychological model is created of the user, which in turn allows showing the advertisement based on the specific characteristics of an individual, which can go as far as to adapt to current psychological state. This is a much more effective form of communication than the one presented in the example of an offline setting.

Rage baiting is an even more dangerous recent trend, visible on all types of social media platforms. This method has been famously used by Facebook, which would show users specifically the content that is expected to generate outrage so that they stay engaged. When one scrolls through Facebook, there is a certain array of information presented, profiles shared and advertisements are chosen for the particular user. The end goal of such an experience is for the user to buy one of the products advertised within the feed. However, this does not end here, as social media platforms need to illicit emotions to make sure that the audience remains engaged. Thus, as visible from the examples presented above, digital asymmetry often encompasses different methods of emotional nudging that can be extremely effective on almost any consumer, due to the data gathered on each user.

What are the implications of digital asymmetry for consumers?

The architecture of online environments largely influences the choices of consumers, therefore affecting their purchasing decisions. A great example can be found in the use of recommender systems by e-commerce websites. Personalised advertising can go as far as to suggest certain products after identifying that a certain individual is e.g. having low self-esteem at the moment. This person will be more likely to click on that advertisement, as it had been selected specifically for them. They can be easily nudged into making that specific purchase, even though they were not planning on doing so. Thus, digital asymmetry largely disrupts the array of choices offered. As this affects the autonomy of consumer decision-making, it can be argued that the current framework present at the EU level should be re-examined.

The main consequence of digital asymmetry is that the framework of protection, as well as the array of accessible remedies available to consumers, should be more extensive. As explained above, the dominance of online intermediaries puts their users at a disadvantage that has never been experienced before. Given that consumer behaviour can become distorted due to digital asymmetry, the framework of protection should reflect such nudging techniques. A large amount of consumer protection framework has been enacted in times when the use of the internet for commercial reasons was still in its infancy. Although the EU legislator is enacting new acts such as the recent Omnibus Directive, which are supposed to render the framework up to date, the speed of legislation-making is far from matching the tempo of the development of modern technologies.

Sources:

BEUC The European Consumer Organisation, ‘EU Consumer Protection 2:0 : Protecting fairness and consumer choice in a digital economy’ (2022)

Helberger N, Lynskey O, Micklitz H, Rott P, Sax M, Strycharz J, ‘EU Consumer Protection 2.0 : Structural Asymmetries in Digital Consumer Markets, A joint report from research conducted under the EUCP 2.0 project’ [2021] BEUC (The European Consumer Organisation)

Helberger N, Sax M, Strycharz J, ‘Choice Architectures in the Digital Economy: Towards a New Understanding of Digital Vulnerability’ [2022] J Consum Policy

Jarboe G, ‘Research Reveals TikTok’s Impact On Consumers’ Purchase Journeys’ Search Engine Journal <https://www.searchenginejournal.com/tiktoks-impact-purchasing-research/453960/#close> accessed 9 February 2023.

Riefa C, ‘Consumer Protection on Social Media Platforms: Tackling the Challenges of Social Commerce’ in Tatiana-Eleni Synodinou, Philippe Jougleux, Christiana Markou, Thalia Prastitou (eds), EU Internet Law in the Digital Era (Springer Cham 2020)

Merrill J, Oremus W, ‘Five points for anger, one for a 'like': How Facebook's formula fostered rage and misinformation’ The Washington Post (Washington, 26 October 2021)