AI in Advertising: Does Telling the Truth Matter?

Topic

Have you ever wondered if an advertisement was generated by artificial intelligence (AI) or authentic, and whether the person advertising it is real or fake? Did it change your intention to buy the product or how you felt about it? This is exactly what this study is investigating.

Brands are embracing artificial intelligence in more efficient ways than ever, be it to manage their business or create content targeted at their audience. This study focuses on whether disclosing the truth, specifically the use of this technology as a support, influences consumers’ intention to purchase. Another dimension is added by analyzing whether some variables—namely, the attitude toward AI, the affinity for technology, the subjective norms, and the need for cognition—have an impact on that relationship.

subjective norms: perceived social pressure to behave in a certain way.

need for cognition: a person’s tendency to enjoy and engage in deep thinking.

Relevance

This study provides brands with insights on how disclosing the use of AI in advertising affects purchase intention and drives consumer behavior. Brands face increasing pressure to be more transparent with their audience, however, there are implications regarding how such transparency is received by consumers. The findings allow brands to develop or adjust their communication and transparency strategies based on consumer responses, while balancing innovation and ethical responsibility. The findings might also be of importance to policymakers in informing future regulations.

 Results

 No significant association was found between disclosure and consumers’ purchase intention. The same applies to the moderating effect of attitude toward AI, affinity for technology, subjective norms, and need for cognition. These variables show no significant role in moderating the relationship between disclosure and purchase intention. However, subjective norms were found to have a significant main effect on purchase intention.

 Implications for practitioners

• Subjective norms influence purchase decisions; hence, brands should consider both their target audience and that audience’s social network when creating content.
• Disclosure that content has been AI-generated/modified does not have a significant effect on consumers’ purchase intentions, implying that brands can be transparent about AI use without risking a decline in purchase intention.
• Including an AI disclosure label does not guarantee that the audience will notice or process it; if it is not explicit enough, it may go unnoticed and have no impact on decision-making.

 Methods

A quantitative approach was used, with a between-subjects online experiment. Participants were randomly split into two groups. Both groups watched the same advertisement video, however, one group saw a video with a label disclosing that some components were AI-generated, while the other group did not receive any disclosure. Participants were also asked to answer questions to evaluate their attitude toward AI, affinity for technology, subjective norms, and need for cognition, as well as their purchase intention. Participants were recruited through a combination of snowball sampling and the Prolific platform.

The initial sample comprised 177 participants. After data cleaning, the final analyzable sample comprised 125 participants, whose responses were retained for analysis.