Sponsorship Disclosure and Third-Party Revelation of Instagram Influencer Advertising: Impact on The Brand and The Influencer

Sanaz Einollahi,Wi-Suk Kwon

doi:10.31274/itaa.11987

Abstract

Despite the regulations requiring disclosure of a paid partnership between a brand and an influencer, some influencers fail to follow them. This study examined consumer perception consequences of the interplay between Instagram influencers’ brand sponsorship disclosure and a third-party revelation of the brand sponsorship. Data were collected via an online experiment with a convenience sample of 319 college students. The results indicate that Instagram influencers’ brand sponsorship disclosure negatively impacts consumers’ perceived credibility of the influencer in two dimensions: trustworthiness and expertise. However, the influencer’s credibility in attractiveness and the brand’s perceived sincerity, both of which were significant predictors of brand attitude, were not impacted by the influencer’s disclosure of the brand sponsorship information. Further, the third-party revelation of the brand sponsorship information does not have an influence on consumers’ perceptions about the influencer or the brand. Theoretical and managerial implications are discussed.

Highlights

Influencer marketing refers to using individuals who have a large group of followers on social media to impact consumers’ buying behavior (Evans et al, 2017)
Follow-up univariate ANOVA revealed that disclosure significantly affected influencer credibility in the expertise (F1,307 = 9.78, p < .005, partial η2 = .031) and trustworthiness (F1,307 = 7.61, p < .05, partial η2 = .024) dimensions; these perceived credibility scores were higher when the influencer did not disclose the paid advertising (Mexpertise = 3.52, Mtrustworthiness = 3.48) than when she did (Mexpertise = 3.25, Mtrustworthiness = 3.25), rejecting H1
Despite the strict guidelines regulated by Federal Trade Commission (FTC), some influencers and brands refuse to follow the guidelines and do not disclose the paid partnership

Summary

Introduction

Influencer marketing refers to using individuals who have a large group of followers on social media to impact consumers’ buying behavior (Evans et al, 2017). Contradictory views exist on the effect of disclosing a paid endorsement on endorser credibility, recent studies about a brand-influencer partnership disclosure in social media emphasize its positive effect because it can represent the brand’s trust in the influencer (Carr & Hayes, 2014) and the influencer’s honesty (Abendroth & Heyman, 2013).

Results

Conclusion