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Public Relations Review

journal homepage: www.elsevier.com/locate/pubrev

Full Length Article

Relationship management through social media influencers: Effects of followers’ awareness of paid endorsement Ganga S. Dhanesh⁎, Gaelle Duthler College of Communication and Media Sciences, Zayed University, PO Box 19282, Dubai, United Arab Emirates

A R T I C L E I N F O

Keywords: Social media influencers Influencer marketing Native advertising Paid endorsement Disclosure Openness Transparency Advertising recognition Relationships Organization-public relationships Influencer-follower relationships Online public relations

A B S T R A C T

This study aimed to examine the effects of awareness of paid endorsements by social media influencers on followers’ cognitive persuasion knowledge (ad recognition), attitudinal persuasion knowledge (relationships with the influencer), and behavioral intentions, specifically eWOM intention and purchase intention. Employing an online survey (N = 269), this study found that awareness of paid endorsement relates to ad recognition, which is correlated with purchase and eWOM intentions. We also found that awareness of paid endorsement is correlated with influ- encer-follower relationship, which is associated with purchase and eWOM intentions. However, ad recognition does not affect influencer-follower relationship. Implications for public relations theory, practice, and policy are discussed.

1. Introduction

Building strong relationships between organizations and their multiple publics through open, authentic, and transparent com- munication has been regarded as the touchstone of excellent public relations (Taylor & Kent, 2014). An essential part of building these relationships has been through media relations, often regarded as the raison d’etre of public relations (Sriramesh & Vercic, 2009). However, the rapid hybridisation of the media environment, the ubiquity of social media, and the rise of social media influencers have challenged traditional notions of media relations, demanding that practitioners tasked with building effective re- lationships with their organizations’ publics engage with these new sets of gatekeepers, opinion leaders, and influentials (Booth & Matic, 2011; Pang, Tan, Lim, Kwan, & Lakhanpal, 2016; Smith, 2010; Walden, Bortree, & DiStaso, 2015).

Social media influencers, a type of opinion leader, engage in self-presentation on social media, accomplished through the creation of their online images employing rich multimodal narration of their personal, everyday lives, and leverage these images to attract attention, and a large number of followers (Khamis, Ang, & Welling, 2016; Senft, 2013). Pivotal to their success are the relationships between their personal brand and their followers, upon which is premised the potential for deep influence (Abidin & Ots, 2015) leading to positive outcomes such as followers’ electronic-word-of-mouth (eWOM) communication and purchase intention (Boerman, Willemsen, & Van Der Aa, 2017; Evans, Phua, Lim, & Jun, 2017; Wojdynski et al., 2017).

However, organizations’ engagement of social media influencers through paid endorsements, and the subsequent blurring of lines between paid and earned media add complex dimensions to the ethical practice of public relations. Specifically, non-disclosure of paid endorsements by social media influencers challenges notions of openness and transparency, implicating sponsoring

https://doi.org/10.1016/j.pubrev.2019.03.002 Received 1 October 2018; Received in revised form 5 March 2019; Accepted 16 March 2019

⁎ Corresponding author. E-mail addresses: [email protected] (G.S. Dhanesh), [email protected] (G. Duthler).

Public Relations Review 45 (2019) 101765

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organizations in deeply problematic issues of truth, fairness, transparency, and disclosure (Macnamara, Lwin, Adi, & Zerfass, 2016; Taiminen, Luoma-aho, & Tolvanen, 2015; Tsetsura & Aziz, 2018; Vercic & Vercic, 2015). As legal systems and industry regulatory bodies across the world struggle to catch up with these evolving issues, it is imperative for organizations and their public relations practitioners to understand the impact of disclosure, or lack thereof, on followers’ relationships with paid influencers, and ultimately on desired behavioral outcomes for sponsoring organizations.

Although an important topic with valuable theoretical, practical, and policy implications, hardly any research has been conducted within the field of public relations on the effects of awareness of paid endorsement, except for a handful of studies (e.g., Sweetser, 2010; Sweetser, Ahn, Golan, & Hochman, 2016; Weitzl, Einwiller, & Seiffert-Brockmann, 2018). However, much work has been conducted on native advertising and the effects of disclosure within the fields of marketing and advertising (Evans et al., 2017; Wojdynski et al., 2017; Boerman et al., 2017; van Reijmersdal et al., 2016).

Accordingly, grounded within literature on native advertising, sponsored content, influencer marketing, and persuasion knowl- edge model (Friestad & Wright, 1994) from marketing and advertising literatures, and relationship management theory from public relations (Hon & Grunig, 1999), this study aimed to examine the effects of awareness of paid endorsements by social media influ- encers on followers’ cognitive persuasion knowledge (ad recognition), attitudinal persuasion knowledge (relationships with the influencer), and behavioral intentions, specifically to engage in eWOM and purchase intention.

We chose to conduct this study in the United Arab Emirates (UAE) for multiple reasons. First, although user trust in online content varies across countries, with higher trust in Asia, Latin America, and Africa compared to Europe and North America (Nielsen, 2015), there is hardly any literature on online relationship building in the Middle East (Radcliffe & Lam, 2017). Second, 94 percent of in- house practitioners in the UAE consider social media influencer marketing as very significant for their brands and 49 percent engage local social media influencers to promote their brands. However, only 12 percent find it necessary to add a disclosure statement or use hashtags such as #sponsored (Stockwell, 2017). These factors make the UAE a productive context to examine the effects of awareness of paid endorsement on social media followers’ cognitive, attitudinal, and behavioral outcomes.

The findings of this study have important, theoretical, practical, and policy implications. Theoretically, findings will add to the emerging literature in the field of public relations on the effects of awareness of paid endorsement on cognitive, attitudinal and behavioral outcomes. The study will enrich the body of knowledge on relationship management by drawing from literatures on native advertising and sponsored content from marketing and advertising, thus updating current understandings of relationship manage- ment over social media. Practically, the findings can provide deep insights to practitioners of the role of disclosure and transparency in building relationships with their multiple publics. Findings will also offer theoretically-grounded evidence for policy makers to create and enact social media legislation that will safeguard the interests of the involved parties. The paper is structured as follows: it starts with a brief background note on the social media landscape in the UAE, and the role of social media influencers in this mediascape; followed by a review of the literature, methodology, results, and discussion.

2. Background

2.1. The social media landscape in the UAE

According to the Arab Social Media Report (Salem, 2017), the six countries of the Gulf Cooperation Council (GCC) - Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE – have led the Arab region in terms of social media use and penetration. Social media users in the Arab countries are mostly young, with 64% under 30 years of age (Salem, 2017). Most importantly, the impact of social media in influencing buyers' decisions is fairly strong, according to the State of Social Media report (CrowdAnalyzer, 2018).

The UAE leads the region in terms of LinkedIn and Instagram penetration rates and is second in Facebook penetration (Salem, 2017). According to the State of Social Media Report (CrowdAnalyzer, 2018), the UAE had 8.5 M active Facebook users, with expatriates comprising 6.3 M. Instagram had around 3.3 M active Emirati users with shopping, fashion, and food the most interesting interactive topics on the platform. Most of the 2 M active Twitter users in the UAE are most interested in fitness and sports. Among the 2 M active Snapchat users in the UAE, females and millennials were the most active. Among the Arab countries, UAE had the highest number of LinkedIn users at 3.5 M.

2.2. The role of social media influencers in the UAE

A study, which interviewed 1000 men and women across the UAE, showed that 71% of UAE residents aged 18–40 take advice online, before a purchase (YouGov, 2016). Residents are most likely to turn to leading social media influencers for recommendations specifically in the areas of beauty, fashion and food. 63% reported that their purchasing decisions are influenced by fashion and beauty influencers with 71% interested in buying from a brand if their influencer endorses it. The most popular fashion and beauty social media influencers among UAE residents include Huda Kattan (@hudabeauty), Joelle Mardinian (‘Maison de Joelle’ blog), Ola Alfares (@olaalfares), Lojain Omran (@lojain_omran), and Amina Shelbaya (aminashelbaya.net). The influencer’s personal style, visuals, and ability to influence people’s lifestyle choices were the main factors that got them followers, sometimes in the millions (YouGov, 2016).

Consequently, influencer marketing in the Middle East and North Africa region has been on the rise from 2016 to 2018, with over 400 influencer campaigns managed by the ITP Live influencer agency in 2017 (CrowdAnalyzer, 2018). According to a YouGov study (Stockwell, 2017) conducted among 100 in-house marketing and communication professionals across a diverse range of industries in the UAE, the impact of social media influencers on driving consumer brand awareness, especially among millennials, has reached

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record high levels. The main platforms for Influencer Marketing in the UAE are Facebook (53%), Instagram (14%), Twitter (10%) and YouTube (10%).

Almost 49% of respondents have worked with social media influencers in the region. 43% of respondents reported that they have spent US$1000-10,000 per social media influencer campaign in the UAE. Most importantly, the study revealed that openness and transparency are key issues in the use of social media influencers in the UAE. 63% of respondents indicated that they occasionally request influencers to publish a disclaimer or disclose that their content is sponsored. However, 24% reported that they never require disclosure and 12% find it necessary to have disclosure through a statement or the use of hashtags such as #Ad or #sponsored.

3. Literature review

3.1. Social Media Influencers (SMI)

Although the term social media influencer is popular in practice, academic definitions are rather scarce. Freberg, Graham, McGaughey, and Freberg (2011) defined SMIs as “a new type of independent third-party endorser who shape audience attitudes through blogs, tweets, and the use of other social media” (p.90). Others have defined social media influencers as a type of micro- celebrity (Senft, 2013), who practices self-presentation on social media, accomplished through the creation of an online image and the use of that image to attract and engage with a large number of followers (Khamis et al., 2016). Social media ethnographers, Abidin and Ots (2015) describe them this way:

Influencers are one form of microcelebrities who document their everyday lives from the trivial and mundane, to exciting snippets of the exclusive opportunities in their line of work. Influencers are shapers of public opinion who persuade their audience through the conscientious calibration of personae on social media, as supported by ‘physical’ space interactions with their followers in the flesh to sustain their accessibility, believability, emulatability, and intimacy - in other words, their ‘relatability’ (p. 3).

These influencers can range from musicians, budding artists, fashion lovers, fitness trainers, friends of celebrities, and high school children (Abidin, 2016; Crain, 2018). While some influencers command almost a million followers and more, some influencers, called micro-influencers, have smaller sets of followers ranging from 10,000 to 150,000 or 500,000. These micro-influencers are perceived to be more accessible and relatable, with a smaller, niche, but deeply dedicated, engaged, and connected set of followers (Boyd, 2016; Wissman, 2018). Although influencers are now most popular on Instagram, their roots in the online world can be traced to blog platforms in 2005, spreading to other social media platforms such as Facebook, Twitter, YouTube, Instagram, and Snapchat (Abidin, 2016).

In some ways they are similar to celebrity endorsers, but in some ways they are different. A celebrity endorser is “any individual who enjoys public recognition and who uses this recognition on behalf of a consumer good by appearing with it in an advertisement” (McCracken, 1989, p.310). According to an updated definition, “A celebrity endorsement is an agreement between an individual who enjoys public recognition (a celebrity) and an entity (e.g., a brand) to use the celebrity for the purpose of promoting the entity” (Lars & Zhou, 2016, p. 644). These definitions highlight the similarity between traditional celebrities and social media influencers. However, non-traditional celebrities such as bloggers, YouTube personalities and Instafamous individuals have been found to be more powerful, in terms of source credibility and consumer buying intention as followers regard them as more credible and more relatable than traditional celebrities (Djafarova & Rushworth, 2017).

SMIs are highly sought after by organizations and brands who wish to tap into their accumulated social capital. Some entities offer matchmaking services between organizations and influencers based on traits that both an influencer and a brand have in common. For instance, Influential, a social data and activation technology organization that matches brands to audiences on Facebook, Instagram, Twitter, Snapchat and YouTube based on data analyzed by IBM Watson, describes influencers with IBM Watson AI per- sonality traits. The top social media influencer of 2018, Huda Kattan, is described by these traits: emotionality, artistic interests, ideal and self-expression (https://www.cbsnews.com/pictures/social-media-influencers-influential-2018/2/). Identifying such personality traits that define influencers’ personal brand enables organizations to align with influencers with whom they share brand com- monalities.

Perhaps the most defining characteristic of influencers’ success is the relationships they build and foster between their personal brand and their followers. These relationships are built on carefully crafted foundations of credibility, which are important for influencers to grow their own media brand (Abidin & Ots, 2015). SMIs occupy a unique in-between place in a continuum of re- lationships between consumers and people they trust, wherein “Influencers fall somewhere between distant friends and acquain- tances and traditional celebrities” (Chae, 2017, p. 249).

Based on these definitions and characteristics of social media influencers including the careful cultivation of personal brands, and building relationships with followers, upon which is built the potential for deep influence that organizations can tap into, this study proposes a definition of social media influencers particularly relevant to theorizing in public relations:

A social media influencer is a person who, through personal branding, builds and maintains relationships with multiple followers on social media, and has the ability to inform, entertain, and potentially influence followers’ thoughts, attitudes, and behaviors.

Organizations leverage these relationships through influencer marketing, which refers to the identification and use of social media influencers to aid in the marketing activities of the brand (Brown & Hayes, 2008). While micro influencers might get compensated with free products or up to $150, a macro influencer with more than 1 million followers can command up to $15,000 per post (Crain, 2018). Seeking out third-party influencers to promote organizational messages is not new. Public relations professionals have been

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establishing blogger relations to engage with the public early on (Smith, 2010; Walden et al., 2015). However, balancing the tensions between credibility and commerce is tricky for both SMIs and sponsoring organizations (Abidin & Ots, 2015). In return for payment or sponsored products and services, influencers often produce content on social media platforms that are similar to advertorials, in that they produce deeply personal stories written to represent their personal opinions, similar to an opinion-editorial. These blurring of boundaries between paid and earned content raises questions of openness, transparency, ethics, and trust, which has been the main foci of researchers studying native advertising.

3.2. Native advertising and influencer marketing

Native advertising is broadly defined as branded content that is assimilated into or integrated with the design of the platform, while a narrow definition refers to “paid advertising that takes the specific form and appearance of editorial content from the publisher itself” (Wojdynski & Evans, 2016, p. 157). Native ads are “so cohesive with the page content, assimilated into the design, and consistent with the platform behavior that the viewer simply feels that they belong” (Interactive Advertising Bureau, 2013, p. 3). Native advertising can encompass a variety of forms, including sponsored posts on social media platforms, and sponsored articles and videos on websites that publish original content (Wojdynski & Golan, 2016). Generally, the practice of embedding commercial messages into non-commercial formats is also referred to as sponsored content, embedded advertising, stealth marketing, covert marketing, branded content, product placement, or native advertising (Boerman & van Reijmersdal, 2016).

Influencer marketing is a type of hidden advertising similar to native advertising in that paid content is made to look like earned (Brown & Hayes, 2008). While this has immense benefits for sponsoring organizations, native advertising tactics, including influencer marketing, is a double-edged sword due to the possibility of deceiving followers, who might mistake paid content for genuine, unpaid posts. While consumers generally appreciate the less interruptive nature of native advertising, they could react negatively to it if they are made aware of its covert persuasive intent (Lee, Kim, & Ham, 2016). At the very least, when not informed about the persuasive intent of apparently non-commercial content, individuals might not be primed to respond to a persuasive situation and might not carefully process the message or mobilize their cognitive and attitudinal defenses against persuasion, thus making themselves vul- nerable to deception. Responding to this problem, scholars in marketing, advertising, and public relations have called for the need to stay open, transparent, and ethical while engaging in tactics typical of covert forms of advertising, and persuasion (Kim, 2017; Lee et al., 2016; Macnamara et al., 2016; Taiminen et al., 2015; Tsetsura & Aziz, 2018; Vercic & Vercic, 2015; Wojdynski & Golan, 2016).

The possibility of deception poses challenges for sponsoring organizations and their SMIs in terms of fair disclosure, openness, and transparency practices required by law. The United States of America’s Federal Trade Commission has issued Endorsement Guides: Truth-in-advertising and Disclosure, which offers updated guidance for influencers and marketers. So does the International Consumer Protection and Enforcement Network’s Guidelines for Digital Influencers. In October 2017, Facebook announced updated advertising transparency and authenticity efforts. The United Arab Emirates has taken action toward this issue in 2018 and requires SMIs to register and obtain a license to operate in the country but no requirements to disclose payments. However, beyond legal requirements, some of the compelling reasons to examine disclosure and its effects on consumers are offered by the persuasion knowledge model.

3.3. Disclosure and consumers’ persuasion knowledge

Persuasion knowledge model (PKM) (Friestad & Wright, 1994) deals with consumers’ knowledge and beliefs about marketers’ persuasion strategies, including topic knowledge, persuasion knowledge, and knowledge of the persuader, and how people develop and use their persuasion knowledge to cope with persuasion attempts. Coping strategies refer to how people respond to a persuasion attempt in order to meet their own goals. They refer to not only strategies of resistance such as ignoring and counter-arguing but also to “resourceful participants who pursue their own goals and have the ability to select response tactics from their own repertoire, akin to the way agents select persuasion tactics” (p. 3). Friestad and Wright (1994) emphasize that they do not assume that people invariably use their persuasion knowledge to resist a persuasion attempt. Instead, people aim to maintain their control over the outcomes and thereby achieve goals salient to them. However, most research has employed PKM to understand how persuasion targets’ increased persuasion knowledge may help them to resist persuasion tactics (Ham, Nelson, & Das, 2015).

Boerman, van Reijmersdal, and Neijens (2012) argued that in the context of sponsorship disclosure, disclosure is posited to trigger conceptual persuasion knowledge, defined as the cognitive dimension that enables the recognition of advertising, its originator and intended audience, and an appreciation of the advertiser’s persuasive intent. Cognition of persuasion can in turn trigger attitudinal persuasion knowledge that includes feelings about honesty, trustworthiness, and credibility about the brand and the advertiser. The following section will now review research on the effects of disclosure on cognitive and attitudinal persuasion knowledge.

3.4. Effects of disclosure on ad recognition

According to PKM, when individuals perceive a message to have persuasive intent, their prior persuasion knowledge will be activated and they will process the message differently than if, they were unaware of the persuasive intent of the message. An effective advertising disclosure that catches the attention of the receiver can enable the individual to recognize the content as paid, and subsequently activate appropriate response strategies. Most of the research in native advertising has shown that disclosure can trigger advertising recognition or conceptual/cognitive persuasion knowledge (Boerman et al., 2012) in various contexts and formats such as online sponsored news stories (Wojdynski & Evans, 2016), sponsored blogs (van Reijmersdal et al., 2016), and product

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placement in television (Boerman et al., 2012). Although prior research across multiple advertising formats and media contexts have found a positive relationship between effective disclosure and advertising recognition, hardly any research except for a handful of studies (e.g., Boerman et al., 2017; Evans et al., 2017) have examined the linkages between disclosure and advertising recognition in the context of social media. Further, most research examining effects of disclosure have used experiments testing effects of the presence/absence of disclosure. However, this study adds to the literature on paid endorsements by social media influencers by examining associations between followers’ awareness of paid endorsement and cognitive, attitudinal and behavioral outcomes, and posits the following:

H1. Awareness of paid endorsement by social media influencers will be positively correlated with advertising recognition in their followers.

Conceptual/cognitive persuasion knowledge is posited to lead to attitudinal persuasion knowledge through generating trust/ distrust in the advertisement/marketing agent (Boerman et al., 2012). However, studies have generated mixed results in this regard. Further, although native tactics are employed extensively by public relations practitioners through engaging social media influencers, hardly any research has examined how disclosure and the resultant conceptual persuasion knowledge (advertising recognition) is related to relationship dimensions such as trust and commitment between the influencer and their followers (Sweetser et al., 2016), variables that are proposed in this study as representing attitudinal persuasion knowledge relevant to public relations.

3.5. Relational maintenance strategies and relational outcomes

Relationship management theory in public relations considers communication as a tool that enables organizations to build strong and positive relationships between organizations and their publics, which managed effectively over a period of time, could bring back mutual benefits for interacting parties (Ledingham & Bruning, 2000; Ledingham, 2008). Although various scholars have proposed different dimensions of these relationships and scales to measure them, Hon and Grunig’s (1999) scale is one of the most widely used instruments to measure the dimensions of organization-public relationships. These dimensions include trust, control mutuality, commitment, and satisfaction.

Trust refers to the level of confidence that interacting parties have in each other and their willingness to open themselves to the other party. Control mutuality measures the degree to which relating parties are satisfied with the amount of control they have over the relationship. Commitment refers to the extent to which interacting parties believe that the relationship is worth investing in, to maintain and promote. Finally, satisfaction measures the extent to which both parties feel favorably about each other.

Scholars have also proposed relationship maintenance strategies as antecedents of good quality relationships (Grunig & Huang, 2000). Relationship maintenance strategies include access, positivity, openness, assurances, networking, and sharing of tasks. En- abling direct access between public relations practitioners and opinion leaders/publics is probably the first step in trying to establish a relationship between an organization and its publics. If the interaction between an organization and its publics is positive and adds value to the relationship, then it can bolster the relationship. The relationship maintenance strategy of openness, most relevant to this study, stresses the importance of transparency and disclosure among the parties involved. Assurances refer to the attempts by both parties to reassure each other that their concerns and issues are legitimate. Networking refers to organizations and publics building a group of similar networks. Finally, relationships can be maintained when both the organization and its publics share in solving common problems. Effectively employing these strategies has been posited to lead to high-quality relationship outcomes (Grunig & Huang, 2000).

However, although openness has been proposed as a probable relationship maintenance strategy, and relationship maintenance strategies have been posited as precursors of relationship quality (Grunig & Huang, 2000), scholarship that empirically explores the association between openness and relationships in the context of social media is limited and even then, findings from these are mixed. Sweetser (2010) found that lack of disclosure in social media campaigns damaged the organization-public relationship within several relationship maintenance strategies. However, in a later study examining the impact of native advertising sponsorship disclosure on the organization-public relationship, Sweetser et al. (2016) found that organization-public relationship was not affected by parti- cipants’ cognizance of ad sponsorship/disclosure. Not only did these studies offer mixed findings, but they also examined the impact of disclosure on the relationship between organizations and their publics. However, in the case of social media influencer marketing, followers build relationships primarily with influencers, and not directly with organizations. This study adds to the literature by examining the impact of followers’ awareness of paid endorsement on the relationship between followers and social media influ- encers, and its further impact if any, on behavioral intentions towards the sponsoring organization. We argue that as social media influencers use their own personal brand to build and maintain relationships with their followers, the dimensions of trust, sa- tisfaction, commitment, and control mutuality used to describe organization-public relationships can be used to describe influencer- follower relationships as well.

3.6. Effects of disclosure on relationship between influencers and followers

While most research on the effects of disclosure on conceptual persuasion knowledge has shown positive relationships, studies examining the effects of cognitive persuasion knowledge on enabling attitudinal persuasion knowledge have shown mixed results. Some studies that have examined the impact of disclosures reveal a significant negative effect on brand related attitudes (Boerman et al., 2012; Boerman, van Reijmersdal, & Neijens, 2014; Boerman et al., 2017; Wojdynski et al., 2017; van Reijmersdal et al., 2016) and credibility perceptions (Wojdynski & Evans, 2016) while some others do not (Carr & Hayes, 2014; Jiang, McKay, Richards, &

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Synder, 2017; Krouwer, Poels, & Paulussen, 2017). Similarly, as mentioned earlier, mixed results can also be seen in the relatively few studies done on examining the effects of disclosure on relationships. While Sweetser (2010) found that lack of disclosure in a social media campaign damaged the organization–public relationship, Sweetser et al. (2016) found that organization–public relationship was not affected by participants’ cognizance of ad sponsorship/disclosure. Because of the mixed results, and because the effect of disclosure on the relationship between influencers and followers is yet to be investigated, we posited a research question to examine this relationship.

RQ 1. How will (a) awareness of paid endorsement and (b) ad recognition affect influencer-follower relationship dimensions of trust, commitment, satisfaction, and control mutuality?

3.7. Effects of disclosure on behavioral intent

Some studies that have examined the impact of disclosures reveal a significant negative effect on purchase intention (Evans et al., 2017; van Reijmersdal et al., 2016), sharing intention (Lee et al., 2016; Wojdynski & Evans, 2016), and eWOM (Boerman et al., 2017; Evans et al., 2017; Wojdynski et al., 2017). However, another set of studies demonstrates that disclosure of native advertising does not always lead to negative consequences. In the Lee et al. (2016) study, although consumers’ ad skepticism and persuasion knowledge were negatively related to sharing intention of native advertising, individuals with stronger information-seeking moti- vation showed more positive attitudinal and behavioral responses.

In a qualitative study, Jiang et al. (2017) found that although some participants had negative feelings about native advertising, others had positive perceptions viewing native ads as helpful, relevant and interesting. Almost half of the participants had neutral perceptions as long as the brand was fair in disclosing sponsorship. Wei, Fischer, and Main (2008) examined the extent to which activating persuasion knowledge affects consumer responses to brands that engage in covert marketing and found that when levels of perceived appropriateness of the tactic and brand familiarity are high, the negative impact of persuasion knowledge activation is diminished. In one of the few studies to examine varying levels of disclosure in blogs, Carr and Hayes (2014) found that explicit disclosure, and no mention of sponsorship led to the most credibility in the opinion leader, whereas an implicit disclosure triggered the least perceptions of credibility. Similarly, Krouwer et al. (2017) found that in the case of online news media, although disclosure recognition resulted in higher conceptual persuasion knowledge, this had no effect on readers’ attitudinal persuasion knowledge and evaluations. Given these contrasting findings, this study posits the following research question:

RQ2. How will (a) awareness of paid endorsement and (b) ad recognition affect behavioral intentions, specifically eWOM and purchase intentions?

Based on relationship management theory, it is also possible to argue that strong relationships between influencers and their followers could lead to positive eWOM intention and purchase intention leading to the next hypothesis:

H2. Influencer-follower relationship will be positively related to (a) eWOM intention and (b) purchase intention

4. Methodology

This research used an online questionnaire to answer the research questions and test the hypotheses. Survey method was used to examine respondents’ perceptions of social media influencers they follow.

4.1. Sampling

A random cluster sample was generated from college students at an all women public university in the United Arab Emirates. College age students were chosen as respondents as they are the most active population on social media (Smith & Anderson, 2018). A random sample of courses across the university was selected. Instructors were contacted and were requested to forward an email to their students. A total of 50 faculty members were invited to participate in the study and 45 of them agreed to forward the email to their students, reaching a total of 954 students. Of these, 578 clicked on the link to the survey, and 342 completed the survey for a 36% response rate.

The online questionnaire asked a qualifying question as to whether respondents follow social media influencers. If they answered no, they were thanked and did not participate in the survey. If they answered yes, they were allowed to continue and answer the rest of the questionnaire. A total of 73 respondents (21.3%) did not follow any social media influencers, making the final sample size of 269 respondents. All respondents were females and 98% were Emirati, with the other 2% being Yemeni, Egyptian, Saudi, Omani, and Bahraini. The average age was 20 years old.

4.2. Measures

The online questionnaire contained questions measuring demographic variables, and five-point scale questions measuring social media usage, social media intensity, electronic word-of-mouth (eWOM), behavioral intention, ad recognition, and influencer-follower relationship. SPSS v24 was used to analyze the results. Certain questions asked respondents about their overall perceptions of social media influencers. However, with regards to ad recognition, eWOM, and influencer-follower relationship, respondents were asked to

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name one particular SMI, and identify on which social media they followed that individual. In order to answer questions regarding relationships, it was important for them to have a specific person in mind. A pilot study was run to test the validity and reliability of the scales. All variables were measured with existing validated scales or scales adapted from existing ones using a five-point scale (see Table 1).

Awareness of paid endorsement was measured by two items: “I am aware that social media personalities are paid to endorse certain brands and products” and “I can tell when a social media personality is paid to endorse a certain brand or product or not” (α = .78).

Ad recognition was measured using two items: “In your opinion, what is the likelihood that this person receives payments from companies/brands for showcasing their products and services?” and “Do you agree or disagree that these endorsements are paid advertising?” (α = .70). Similar measures have been used in earlier studies to assess consumers’ ability to recognize advertising (Boerman et al., 2012; Evans et al., 2017).

Perceptions of influencer-follower-relationship were evaluated based on Hon and Grunig (1999) and measured four dimensions: trust (six items), commitment (four items), satisfaction (four items) and control mutuality (four items) (α = .93)

eWOM was adapted from the Evans et al. (2017) scale, and asked the participants to respond to the following statements: “I share

Table 1 Summary of measures.

Constructs Item Description (Likert Scale, 1=strongly disagree, 5=strongly agree) Source

Awareness of Paid Endorsement I am aware that social media personalities are paid to endorse certain brands and products I can tell when a social media personality is paid to endorse a certain brand or product or not

Authors’ own questions

Ad Recognition In your opinion, what is the likelihood that this person receives payments from companies/brands for showcasing their products and services? Do you agree or disagree that these endorsements are paid advertising?

Adapted from Boerman et al. (2012), Evans et al. (2017)

eWOM I share posts from this social media personality with my friends on social media I share my experience with brands endorsed by this social media personality with my friends on social media I am willing to spread word of mouth about brands endorsed by this social media personality on social media

Adapted from Evans et al. (2017)

Purchase Intention I would like to try the brands endorsed by this social media personality I would buy other products of this brand because of this social media personality I would actively seek out the product/service shown by this social media personality in order to purchase it.

Adapted from Evans et al., 2017

Influencer-Follower Relationship Trust This social media personality treats people like me fairly and justly. Whenever this social media personality endorses a product or service, I know he/ she will be concerned about people like me. This social media personality can be relied on to keep his/her promises. I believe that this social media personality takes the opinions of people like me into account I feel very confident about this social media personality’s skills related to his/her area of expertise? This social media personality has the ability to accomplish what he/she says they will do. Control mutuality This social media personality and people like me are attentive to what each other say This social media personality believes the opinions of people like me are legitimate In dealing with people like me, this social media personality tries to control and dominate. (Reversed) This social media personality really listens to what I have to say Commitment I feel that this social media personality is trying to maintain a long-term commitment to people like me. I can see that this social media personality wants to maintain a relationship with people like me. There is a long-lasting bond between this social media personality and people like me. Compared to other people, I value my relationship with this social media personality more. Satisfaction I am happy with this social media personality We both benefit from this relationship. Most people like me are happy in their interactions with this social media personality Generally speaking, I am pleased with the relationship this social media personality has established with people like me.

Adapted from Hon and Grunig (1999)

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posts from this social media personality with my friends on social media,” “I share my experience with brands endorsed by this social media personality with my friends on social media,” and “I am willing to spread word of mouth about brands endorsed by this social media personality on social media.” (α = .83)

Purchase intention was measured using the Evans et al. (2017) scale: “I would like to try the brands endorsed by this social media personality,” “I would buy other products of this brand because of this social media personality,” “I would buy the product/service shown by this social media personality if I happened to see the brand,” and “I would actively seek out the product/service shown by this social media personality in order to purchase it.” (α = .89)

5. Results

5.1. Use of social media

Respondents were asked about how often they used the most common social media, as well as how many influencers they follow on each social media. Respondents reported using Snapchat the most often (M = 4.54) followed by Instagram (M = 4.30), and YouTube (M = 4.23). Twitter and Facebook were the least used with M = 3.13 and M = 1.30 respectively.

Although Snapchat was the most used, Instagram is the social media platform where respondents follow influencers. The number of social media influencers followed by respondents varied widely depending on the social media (see Table 2). Most respondents followed a higher number of social media influencers on Instagram, followed by Snapchat and YouTube.

Our first hypothesis predicted that awareness of paid endorsement by social media influencers will be positively correlated with advertising recognition in their followers. Participants reported a higher level of awareness (M = 4.15, SD = .79) than ad recognition (M = 3.95, SD = .95). As the correlation indicates (see Table 3), the results confirmed the positive relationship between the two variables, awareness of paid endorsement and ad recognition (r(239) = .205, p < .001).

The positive correlation supports our first hypothesis. The results indicate that followers are aware that influencers are paid for their endorsement, regardless of whether the influencers disclose it or not. This awareness also relates to the followers recognizing the content as an advertisement. As such, followers will be ready to process the persuasive messages from the social media influencers.

Our first research question asked about how (a) awareness of paid endorsement and (b) ad recognition will affect influencer- follower relationship dimensions of trust, commitment, satisfaction, and control mutuality. As Table 3 indicates, awareness of paid endorsement was positively correlated with all four dimensions of the influencer-follower relationship: trust (r(235) = .381, p < .001), control mutuality (r(237) = .208, p < .001), commitment (r(237) = .139, p < .05), and satisfaction (r(236) = .316, p < .001). The participants’ level of awareness was more strongly correlated with trust and satisfaction with commitment the least correlated. The results also found that ad recognition was not correlated with any of the four dimensions.

Several multiple regressions were run to test the relationships between awareness and ad recognition and the four dimensions of influencer-follower relationship (see Table 4). The results indicated that the two predictors only explained 14.5% of the variance for trust (R2 = .145, F(2, 234) = 19.641, p < .0001), 5.6% of the variance for control mutuality (R2 = .056, F(2, 234) = 6.958, p < .001), 3.2% of the variance for commitment (R2 = .032, F(2, 234) = 3.851, p < .05), and 10.5% of the variance for satisfaction

Table 2 Number of social media influencers followed on each social media.

Instagram Facebook YouTube Snapchat Twitter

N % N % N % N % N %

None 17 6.3 255 94.8 86 32.0 15 5.6 113 42.0 1-5 60 22.3 7 2.6 56 20.8 63 23.4 65 24.2 6-10 53 19.7 2 0.7 32 11.9 63 23.4 39 14.5 11-20 34 12.6 1 0.4 44 16.4 59 21.9 18 6.7 21-50 52 19.3 1 0.4 25 9.3 46 17.1 16 5.9 51 and more 53 19.7 3 1.1 26 9.7 23 8.6 18 6.7

Table 3 Correlations of awareness of paid endorsement, ad recognition, behavioral intentions and follower influencer relationship dimensions.

M eWOM Purchase Trust Control Commitment Satisfaction Awareness Ad recognition

eWOM 3.18 1.0 Purchase 3.21 .528* 1.0 Trust 3.66 .225* .394* 1.0 Control 3.39 .351* .481* .574* 1.0 Commitment 3.39 .399* .452* .548* .738* 1.0 Satisfaction 3.78 .205* .324* .628* .465* .539* 1.0 Awareness 4.15 .054 .134 .381* .208* .139 .316* 1.0 Ad recognition 3.95 .203* .249* .085 .150 .140 .081 .205* 1.0

* p < .001.

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(R2 = .105, F(2, 234) = 13.624, p < .0001). Awareness was found to be a significant predictor in only two of the dimensions, trust (β = .380, p < .0001) and satisfaction

(β = .320, p < .0001) meaning that when respondents are aware of paid endorsement, they are more likely to trust and be satisfied with the relationship. However, ad recognition was not found to be a significant predictor in any of the four multiple regression.

The first research question found that awareness of paid endorsement significantly influences trust and satisfaction between followers and social media influencers. However, commitment and control mutuality are not impacted by the awareness of paid endorsement. In essence, if the influencers disclosed their paid endorsement, they could significantly increase the level of trust and satisfaction. On the other hand, the results also found that ad recognition does not influence at all the follower-influencer re- lationship. This indicates that whether the social media post is seen as an ad will not influence the relationship between the follower and the social media influencer.

Our second research question asked about how (a) awareness of paid endorsement and (b) ad recognition will affect behavioral intentions, specifically eWOM and purchase intentions. As seen in Table 3, awareness of paid endorsement was not correlated with eWOM nor purchase intentions. However, ad recognition was positively correlated with the two behavioral intentions: eWOM (r (260) = .203, p < .001) and purchase intentions (r(257) = .249, p < .001). The multiple regressions yielded a weak R2 (see Table 5). Awareness and ad recognition only explained 3.5% of the variance for eWOM (R2 = .035, F(2, 234) = 4.190, p < .05) and 6.3% of the variance for purchase intention (R2 = .063, F(2, 234) = 7.745, p < .001). Ad recognition was found to be a significant predictor for eWOM (β = .185, p < .001) and purchase intention (β = .217, p < .001) but awareness was not.

Overall, the results for the second research question indicate that only ad recognition significantly influences the follower’s behavioural intentions (eWOM and purchase intentions). Interestingly, when followers recognize the endorsements as ads, they are more likely to buy the products/services or share the social media influencers’ message. The level of awareness of paid endorsement did not influence the followers’ behaviour.

Our second hypothesis predicted that influencer-follower relationship will be positively related to (a) eWOM intention and (b) purchase intention. All four dimensions of the influencer-follower relationship correlated with the two behavioral intentions. eWOM correlated with trust (r(238) = .225, p < .0001), satisfaction (r(238) = .207, p < .001) and correlated more strongly with control mutuality (r(238) = .351, p < .001) and commitment (r(238) = .399, p < .0001). Purchase intention correlated with trust (r (237) = .394, p < .0001), satisfaction (r(237) = .324, p < .0001), and also correlated more strongly with control mutuality (r (237) = .481, p < .0001), and commitment (r(237) = .452, p < .0001).

Tests for multicollinearity indicated that a low level of multicollinearity was present (VIF= 1.98 for trust, 2.42 for control mutuality, 2.45 for commitment, and 1.77 for satisfaction). Multiple regressions were run to test the hypothesis predicting the relationships between each dimension of influencer-follower relationship and the two behavioural intentions (see Table 6). The results indicated that the four dimensions explained 16.5% of the variance for eWOM (R2 = .165, F(4, 232) = 11.129, p < .0001), and 27% of the variance for purchase intention (R2 = .270, F(4, 232) = 20.447, p < .0001). Commitment was the only significant predictor (β = .310, p < .0001) for eWOM, and control mutuality (β = .257, p < .001) was the only factor for purchase intention.

These results support the second hypothesis predicting that the follower-influencer relationship can influence the followers’ behavioural intentions. More specifically, when followers feel committed to the relationship with the social media personality, they are more likely to share the influencer’s social media posts. The regression also found that control mutuality significantly influences the followers’ purchase intention. When followers feel that they have some level of control in the relationship with the influencer, they are more likely to buy the products endorsed by the influencer.

Table 4 Regression of ad recognition and awareness on influencer-follower relationship dimensions.

Trust Control Mutuality Commitment Satisfaction

B SE B β B SE B β B SE B β B SE B β

Ad recognition .003 .048 .003 .086 .048 .116 .100 .057 .114 .014 .051 .018 Awareness .359 .059 .380* .168 .059 .184 .124 .070 .116 .310 .061 .320*

R2 .145 .056 .032 .105

* p < .0001.

Table 5 Regression of ad recognition and awareness on behavioral intentions.

eWOM Purchase Intention

B SE B β B SE B β

Ad recognition .205 .073 .185* .209 .063 .217*

Awareness .007 .088 .006 .104 .076 .089 R2 .035 .063

* p < .001.

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6. Discussion

The findings of this study revealed that awareness of paid endorsement is positively associated with ad recognition. Although ad recognition does not correlate with influencer-follower relationship, it is positively correlated with purchase and eWOM intentions. We also found that awareness of paid endorsement is positively associated with influencer-follower relationship but is not correlated with eWOM and purchase intentions. These are interesting findings, which have important theoretical, practical and policy related implications, discussed next.

The finding that awareness of paid endorsement is positively associated with ad recognition is supported by research in native advertising (Boerman et al., 2012; Wojdynski & Evans, 2016) and in the context of social media (Boerman et al., 2017; Evans et al., 2017), in line with the predictions of PKM. However, ad recognition did not correlate with the various dimensions of influencer- follower relationship, but instead directly correlated with behavioral intentions. This finding adds to the mixed results of studies that have examined the relationship between disclosure and behavioral intent. Although some studies have shown the negative effect of disclosure on behavioral intention (Boerman et al., 2017; Evans et al., 2017; van Reijmersdal et al., 2016; Wojdynski & Evans, 2016; Wojdynski et al., 2017) findings from this study strengthen emergent literature that the relationship need not always be negative (Jiang et al., 2017; Krouwer et al., 2017). The information utility aspect of PKM can explain this. When audiences perceive adver- tising to be informative, helpful, and relevant in enabling decision-making, information utility could trump resistance to persuasion. Strength of information utility is all the more accentuated in the context of social media influencers due to hyper targeting, and because only people who are extremely keen on a topic will tend to follow influencers in that field. So, it appears that social media followers recognize that they are encountering an ad when they are made aware of paid content. However, they use this information to help them in their decision-making, and not to diminish their relationship with the influencer.

The finding that ad recognition is not correlated with influencer-follower relationship supports Sweetser et al.’s (2016) finding that organization-public relationship is not affected by participants’ cognizance of ad sponsorship/disclosure. However, this study found that awareness of paid endorsement positively correlated with influencer-follower relationship, specifically predicting the dimensions of trust and satisfaction. In other words, knowing that they were being exposed to paid content only bolstered the relationship between followers and influencers, especially strengthening trust and satisfaction. Although counter-intuitive to the predicted negative impact of disclosure on attitudinal persuasion knowledge (Boerman et al., 2012, 2014, 2017; Wojdynski et al., 2017; van Reijmersdal et al., 2016) this finding could be explained in the context of social media influencer marketing. When followers are made aware that the influencers they follow are being paid to endorse content, that disclosure could enhance followers’ perceptions of the honesty, openness, and transparency of the influencers. Disclosure could assure followers that influencers are being open and transparent while building relationships with their followers, and this in turn could strengthen trust in and satisfaction with the relationship.

Finally, the finding that influencer-follower relationship correlated with behavioral intentions, with the dimension of commit- ment predicting eWOM intention and control mutuality predicting purchase intention the most strengthens existing research that the relationship between attitudinal persuasion knowledge and behavioral intention need not always be negative (Jiang et al., 2017; Lee et al., 2016). The finding that followers’ behavioral intentions were influenced most strongly by the relationship dimensions of commitment, and control mutuality, indicates that while openness and transparency might strengthen the relationship between followers and influencers, it takes more than trust and satisfaction to induce behavioral intention. It takes a sense of commitment to the relationship to predict intention to engage in eWOM intention. Followers also need to perceive a sense of control over the relationship to consider purchasing the endorsed product or service. These findings have important implications for theory, practice and policy.

6.1. Implications for theory, practice, and policy

Merging literatures from advertising, marketing and public relations, findings of this study have multiple theoretical implications. First, the finding that awareness of paid endorsement positively affects influencer-follower-relationships, which in turn predicts behavioral intentions enhances understanding of relationship management over social media, specifically by (a) providing empirical evidence for openness as a relationship management strategy that could deliver positive behavioral intentions (Hon & Grunig, 1999), (b) in the newer context of influencer-follower relationships, thus extending emergent literature on the effects of disclosure on

Table 6 Regression of trust, commitment, control mutuality, satisfaction on behavioral intentions.

eWOM Purchase Intention

B SE B β B SE B β

Trust .009 .125 .006 .187 .100 .151 Control mutuality .185 .139 .126 .326 .114 .257*

Commitment .395 .121 .310* .185 .097 .171 Satisfaction −.019 117 −.014 .026 .094 .021 R2 .165 .270

* p < .001.

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organization-public-relationships (Sweetser, 2010; Sweetser et al., 2016). Second, the finding that awareness of paid endorsement most strongly predicts trust and satisfaction in the relationship between

followers and influencers, while control mutuality and commitment most strongly predicts behavioral intentions suggests the dif- ferential effects of the antecedents and consequences of influencer-follower-relationships (Hon & Grunig, 1999), specifically in the context of relationship management over social media.

Third, these findings also offer empirical evidence for the positive effects of the ethical practice of public relations through strategies of openness and transparency (Kim, 2017; Lee et al., 2016; Macnamara et al., 2016; Taiminen et al., 2015; Tsetsura & Aziz, 2018; Vercic & Vercic, 2015; Wojdynski & Golan, 2016).

Fourth, the study found that awareness of paid endorsement relates with ad recognition, which is correlated with purchase and eWOM intentions. However, ad recognition does not affect influencer-follower relationship. These findings offer clarity to the mixed findings in the literature on the effects of disclosure and ad recognition on attitudinal persuasion knowledge and behavioral intention and offers much needed empirical evidence for the information utility of disclosure (Friestad & Wright, 1994). Finally, most extant studies on disclosure in native advertising have focused on examining effects on variables such as trust and credibility. This study extends the literature on disclosure by examining effects on influencer-follower relationships.

The findings also offer practitioners important insights into the drivers of relationship building in the emergent context of social media influencers and their followers. Findings revealed that disclosure could be a win-win for followers, influencers, and organi- zations. For followers, disclosure offers information needed to make informed choices and decisions (Friestad & Wright, 1994). For influencers, disclosure enhances followers’ perceptions of the influencer’s honesty, transparency, and hence credibility. For spon- soring organizations, openness, and perceptions of honesty and transparency could lead to stronger relationships, which could lead to desired behavioral outcomes (Hon & Grunig, 1999). This is relatively new territory for public relations and communication prac- titioners tasked with influencer marketing and relationship building, and learning that disclosure and openness only strengthens outcomes for followers, influencers, and organizations can bolster the ethical practice of relationship building over social media.

Finally, findings from this study can offer policy makers insights into social media users’ perceptions of openness, and trans- parency, which can inform public policy that safeguards the interests of all interacting parties.

6.2. Limitations and future research

While findings from this quantitative study has offered some interesting insights into follower behavior, an ethnographic study that examines followers’ thoughts, beliefs, and motives while following influencers could offer more richly nuanced insights into the intricacies of follower behavior on social media.

Since the study was conducted at a public women’s university, all of the sample is female. While this is all right given the context of this study where females tend to comprise the bulk of social media influencers and followers, it might be theoretically and practically productive to examine whether gender makes a difference in followers’ relationship building with influencers.

6.3. Conclusion

Grounded within persuasion knowledge model (Friestad & Wright, 1994), relationship management theory from public relations (Hon & Grunig, 1999), and literature on native advertising, and influencer marketing from marketing and advertising literatures, this study aimed to examine effects of awareness of paid endorsements by social media influencers on followers’ cognitive and attitudinal persuasion knowledge, and behavioral intention, specifically eWOM intention and purchase intention. We found that awareness of paid endorsement relates with ad recognition. However, while ad recognition does not affect influencer-follower relationship, it is correlated with purchase and eWOM intentions. We also found that awareness of paid endorsement is correlated with influencer- follower relationship, which is associated with purchase and eWOM intentions. Together, these findings have enhanced literature on relationship management by drawing from marketing and advertising research and have updated understandings of relationship management over social media.

Declarations of interest

This research was proposed by the Advertising Business Group (ABG), a non-profit group based in the United Arab Emirates focused on advertising self-regulation in the region. However, the study was not funded and there were no potential conflicts of interest. Results of this study were presented at the annual general meeting of the ABG.

Acknowledgements

We would like to thank Alex Malouf of Advertising Business Group (ABG), an organization that advocates responsible advertising standards in the Gulf, for giving us this opportunity to work on a project that has implications for practice and policy making in the MENA region.

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