ANTECEDENTS AND CONSEQUENCES OF WEB ADVERTISING CREDIBILITY: A STUDY OF CONSUMER RESPONSE TO

A BANNER ADS

Sejung Marina ChoiNora J. Rifon

AGENDA

Introduction

Literature Review

Research Questions

Method

Results

Conclusion

INTRODUCTION

Since 1994 when the first Internet banner ads were sold, advertisers have been quick to develop the medium and reach their audiences.

Internet advertising is expected to continue.

Advertising on the Internet is predicted to grow to $11.5 billion in 2003, exceeding advertising spending in some traditional media such as magazines and radio.

With abundant information available to consumers from ostensibly unlimited and often unfamiliar sources, building credibility and recognition is an essential challenge to Internet marketers.

INTRODUCTION

However, the credibility of information presented on the Internet has been questioned.

Although many consumers use it, the Internet is still a relatively new and sometimes disorientating place for them.

Consumers rarely find the face-to-face or voice-to-voice interpersonal reassurance provided by sales representatives.

Nor are they likely to find firsthand, physical or tactile experiences that are available through brick and mortar stores.

INTRODUCTION

For some, the concern for the risks of doing business online may be assuaged by trust for an established, credible brand or company.

Thus, online consumers are likely to seek out and purchase brands they trust.

Although marketers are still not sure how to develop and maintain their credibility or trust, dot-com companies spent a considerable amount of money on advertising in traditional media to achieve initial brand recognition and direct consumers to their websites.

INTRODUCTION

The study presented in this article explores the role of source credibility in determining Web advertising effectiveness.

Specifically, the study examined the effects of website credibility and advertiser credibility on ad credibility, ad and brand attitude, and product purchase intention.

The effects of banner ad relevance on consumer perceptions of the ad and brand are conceptually developed based on studies of the matching of celebrity sources to products.

LITERATURE REVIEW

Banner ads are the most prevalent form of web advertising (Zeff and Aronson 1999) accounting for one-third of total revenues during the second and third quarters of 2001 (IAB 2001).

Banner ads have proven to successfully generate advertising effects such as brand awareness, attitudes, and purchase intention (Briggs and Hollis 1997; IAB 2001) as well as build web traffic (Li 1998).

Incipient research on banner ad effectiveness essentially ignored credibility and focused on ad or message-related characteristics (Ju-Pak 1999; Li 1998).

LITERATURE REVIEW

More recent work has attempted to develop a theoretical framework for advertising effects on the web (e.g., Cho 1999; Rodgers and Thorson 2000; Rossiter and Bellman 1999) with a shared assumption that audiences might process web advertising information differently from that in traditional media due to the distinctive characteristics of the medium such as interactivity.

LITERATURE REVIEW

With no overarching quality control or editing process, anyone can author or provide information on the Internet.

Accordingly, understanding consumer judgments of web information credibility is an essential issue for the development of ad effects models.

Consumers have been found to use cues available at the site to filter information on the Web. For example, the website provider's reputation and URL domain type (e.g., edu, gov, org, or com) are among the criteria consumers utilize to judge credibility of information presented in the site (Rieh 2002).

LITERATURE REVIEW

Consumer judgments of website information credibility are more a function of the website provider's credibility (viewed as the source of information), than by the perceptions of the actual author or creator of the content (Rieh 2002).

If traditional theoretical approaches to advertising effects apply to the Internet, then the perceived credibility of the website may affect the credibility perception of an ad placed in the site and the subsequent attitudinal outcomes of the ad.

A useful approach to understanding these relationships is source credibility.

LITERATURE REVIEW

"Source credibility" is a term commonly used to refer to a message sender's positive characteristics that influence the receiver's acceptance of the message communicated (Ohanian 1991), and source credibility has been found, in part, to determine the persuasiveness of a message (Petty and Cacioppo 1986).

Expertise and trustworthiness have been identified as potentially important and enduring dimensions of source credibility (Hovland, Jannis, and Kelley 1953; Ohanian 1990; Tripp, Jensen, and Carlson 1994).

LITERATURE REVIEW

Expertise is the extent to which a communicator is perceived to be able to provide valid, accurate information (Hovland, Jannis, and Kelley 1953).

Trustworthiness refers to an audience's belief that the communicator provides information in an honest manner, without a motivation for manipulation or deception (Ohanian 1991).

The most commonly studied source in advertising is the message presenter or product endorser, often a celebrity.

Well-known people or celebrities are viewed as more credible and influential than average people in most cases.

LITERATURE REVIEWS

A full model of source effects must include the sponsor (or advertiser) and the author of the ad.

Of particular note is that advertisers or sponsors of ads appear to be an important source for ad effects (Goldsmith, Lafferty, and Newell 2000; MacKenzie and Lutz 1989).

RESEARCH QUESTIONS

Corporate credibility is defined as "the extent to which consumers believe that a firm can design and deliver products and services that satisfy customer needs and wants" (Keller 1998, p. 426).

And has been found to have direct, positive effects on attitude toward the ad, attitude toward the brand, and purchase intent (Goldsmith, Lafferty, and Newell 2000).

In some Attitude-toward-the-Ad research, advertiser credibility appeared to exert a strong effect on attitude toward the ad by enhancing ad credibility sponsored by the company or advertiser (MacKenzie and Lutz 1989, p. 51).

RESEARCH QUESTIONS

The Attitude-toward-the-Ad model suggests the influences of advertiser credibility on ad attitudes be mediated by ad credibility.

Thus, no direct relationship of advertiser credibility to attitude toward the ad was proposed.

H1a: Perceived advertiser credibility is positively and directly related to ad credibility.

H1b: Perceived advertiser credibility is positively and directly related to attitude toward the brand.

H1c: Perceived advertiser credibility is positively and directly related to purchase intent.

RESEARCH QUESTIONS

Several empirical studies have shown that different vehicles can influence the persuasiveness of the same ad (Aaker and Brown 1972; Freiden 1982; Winick 1962).

With the large number of websites available, consumers tend to seek credible information provided by well-established websites.

In addition, since banner ads are inherently short on information, it is more likely that people might use other cues available at the time of processing (e.g., vehicle source or site provider) to make judgments of the ads.

RESEARCH QUESTIONS

Indeed, website reputation has been found to serve as a cue for consumer inference-making about the content carried in the site including the ads appearing in the website (Hermes 1996; Shamdasani, Stanaland, and Tan 2001).

H2a: Perceived site credibility is positively and directly related to ad credibility. H2b: Perceived site credibility is positively and directly related to attitude toward the brand.

H2c: Perceived site credibility is positively and directly related to purchase intent.

RESEARCH QUESTIONS

When the advertised product fits well with the context, the content presented in the environment, the audience is likely to find the ads more useful and interesting.

Ads that promote products that are relevant to the content of the vehicle in which the ads appear would induce more positive audience responses.

H3a: Relevance between the content of the site and the advertised product on the site is positively and directly related to ad credibility.

H3b: Relevance is positively and directly related to attitude toward the brand. H3c: Relevance is positively and directly related to purchase intent.

RESEARCH QUESTIONS

However, they are also expected to exert indirect influences on attitude toward the ad through ad credibility, as evidenced in the Attitude-toward-the-Ad study (MacKenzie and Lutz 1989).

In addition, the interrelationships among ad attitudes, brand attitudes, and purchase intent have been suggested and tested in prior research.

H4a: Ad credibility positively and directly relates to attitude toward the ad. H4b: Attitude toward the ad positively and directly relates to attitude toward the brand.

H4c: Attitude toward the brand positively and directly relates to purchase intentions.

RESEARCH MODEL

METHOD

Eight versions of websites and banner ads were professionally developed to reflect several cases of banner ad placement.

Two online photojournalism magazine sites with an editorial feature and two banner ads were developed.

"LIFE" was chosen as a well-established online magazine and a real but barely known magazine site.

"foto8" was selected from a search on the Internet as a less known vehicle.

METHOD

The banner ads featured a digital camera or an MP3 player.

Digital cameras were expected to more closely relate to the content of the website (high relevance) than MP3 players (low relevance).

Kodak and Sony were selected as reputable advertisers for the digital camera and MP3 player ads respectively.

A fictitious advertiser, Keica was used to represent the case of an unknown or unfamiliar advertiser promoting its products online.

A fictitious, neutral, brand name, MX5200 was used for both products in all of the banners, as a newly introduced brand to prevent any possible effects of prior experience or knowledge with real brands.

METHOD

RESULTS

CONCLUSION

Overall this study expands the literature on source credibility and web advertising effectiveness by examining relevant variables in a systematic way.

The results of the study revealed many significant relationships among the variables of interest.

Of particular note are the effects of advertiser credibility and website credibility on consumer responses to banner ads.

Most importantly, source credibility perceptions and website/product relevance cannot be ignored in studying ad and brand-related outcomes and have merit to further our understanding of web advertising effectiveness.

CONCLUSION

Results suggest that credibility perceptions play an important role in the development of ad/brand attitudes and purchase intent.

Both advertiser and website credibility perceptions appear to influence banner ad credibility that subsequently affects attitudes toward the ad/brand and purchase intention.

Although website credibility was not found to exert direct effects on attitude toward the brand and purchase intent, advertiser credibility appears to directly influence brand attitudes and purchase intention.

CONCLUSION

Consistent with the findings in traditional media (Goldsmith, Lafferty, and Newell 2000), advertiser credibility enhances ad/brand attitudes and purchase intention.

Perhaps in this still relatively new environment (i.e., the Internet) the credibility of the company who manufactures and sells the advertised product plays a more important role in consumer responses to banner ads, than the credibility of its site of placement.

Website credibility may be more important when the site actually serves as retailer.

CONCLUSION

When their brand does not have an established image, it would be a good idea to place its ads on websites perceived as credible and relevant to the product category by target audiences.

This would facilitate the process of building a credible, favorable image of the brand and greater intention to purchase the product by making the ad of the brand more credible.

CONCLUSION

On the other hand, well-known advertisers with established reputations can rely on their own credible image to generate positive ad outcomes.

They can place banner ads in somewhat less credible websites because creating ad credibility is not a big concern for them.

Rather, they may need to consider relevance as an important factor in selecting websites for banner ad placements because when the website content is closely related to the advertised product category, brand attitudes and purchase intent are enhanced.

CONCLUSION

However, when ad content does not match site content, the user may notice, stop processing, and discount the credibility of the advertiser and ad content on the basis of its low utility.