YouTube Marketing: Examining the impact of user-generated-content sponsorship

Abstract

Social media has been recognized as an important marketing tool for affecting consumer behaviour, which motivated companies to search for new opportunities to advertise their brands. In this regard, they critically assess sponsoring user-generated-content (UGC) creators in social media to feature their products. However, there is no clear evidence of the effectiveness of this approach on consumers' decisions. This study assesses the impact of explicit sponsorship of social media UGC creators on consumers' behaviour. The purpose is to examine the factors affecting viewer's willingness to purchase a product through a social media channel, and understand whether a sponsored video can influence viewers' opinions. The effects of UGC social media videos on consumers is investigated through a within-design experimental study. The data consists of multiple measurements on a set of respondents, chosen among 241 females, for two YouTube videos; one self-produced and the other associated with a brand. Four analyses are applied; mean comparison, moderation, multi-group moderation and moderated mediation. The study indicates that sponsorship of UGC creators on YouTube is an effective way to advertise brands as it strengthens the respondents' purchase intention. Results showed that sponsorship increases the source's perceived expertise. Although sponsorship decreases the endorser's trustworthiness, the impact of a specific brand positively effects consumers' willingness to buy, and word-of-mouth (WOM) intention. Marketers should be aware of the successful impact of YouTube. This study provides an important insight for marketers seeking ways to integrate their brand marketing strategies into new media technologies, and are interested in advertising with UGC creators on social media channels. The approach of using well-known YouTubers for sponsorship is an emerging marketing strategy for companies. This study focuses on the importance of new media technologies for brand advertisements. As one of the first to investigate the sponsorship effect in UGC on YouTube, the study contributes to practice by highlighting new advertisement opportunities.