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How does personalization affect brand relationship in social commerce? A mediation perspective

Trang P. Tran (Department of Marketing and Supply Chain Management, College of Business, East Carolina University, Greenville, North Carolina, USA)
Michelle van Solt (College of Business Administration, Valparaiso University, Valparaiso, Indiana, USA)
James E. Zemanek Jr (Department of Marketing and Supply Chain Management, College of Business, East Carolina University, Greenville, North Carolina, USA)

Journal of Consumer Marketing

ISSN: 0736-3761

Article publication date: 18 March 2020

Issue publication date: 18 June 2020

2867

Abstract

Purpose

This paper aims to tests a conceptual model capturing the influence of personalized advertising on customer perceptions of brands in social media and identifies three market segments based on customers’ reactions to personalized ads.

Design/methodology/approach

Two studies are developed to test the model using partial least squares structural equation modeling (PLS-SEM). Additionally, cluster analysis, multi-group analysis (MGA) and serial mediation tests are also conducted to provide better insights into the results.

Findings

The results of the two studies show that all nine hypotheses are supported except for H4 in Study 1. Three market segments (ad lovers, ad adjusters and ad haters) are identified. Each segment has a typical attitude toward personalized advertisements.

Research limitations/implications

Built on self-congruence literature, the current research posits that consumer-brand self-congruence can be established when a customer sees a brand advertised on Facebook after searching for that brand online. Consistently, this paper finds that through self-congruence, personalized advertising has a positive impact on brand-related outcomes.

Practical implications

Three segments identified – “ad lovers,” “ad adjusters” and “ad haters” are important for marketers. Companies should develop an appropriate advertising campaign for each segment, especially once the general data protection regulation is in place. Companies will be subject to a noncompliance penalty if an advertisement is posted on a user s account without approval. Identifying this segment promptly will not only enable companies to save resources but also help avoid legal complications associated with privacy concerns.

Originality/value

This research sheds light on the effects of personalized advertising on customer perceptions of brands in social commerce.

Keywords

Acknowledgements

The author thanks two students, Gretchen Gartman and Chelsea Brandt, who help with literature review and hypotheses development for this paper.

Citation

Tran, T.P., van Solt, M. and Zemanek Jr, J.E. (2020), "How does personalization affect brand relationship in social commerce? A mediation perspective", Journal of Consumer Marketing, Vol. 37 No. 5, pp. 473-486. https://doi.org/10.1108/JCM-12-2017-2499

Publisher

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Emerald Publishing Limited

Copyright © 2020, Emerald Publishing Limited

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