The perceived effectiveness of overt versus covert promotions

Abstract

Purpose

The purpose of this study contributes to literature on marketing communications by empirically contrasting the effectiveness of a new form of covert promotions (product placement in recipes) and an overt promotion (traditional advertisement). The mediating role of perceived believability of promotional materials and the moderating roles of advertising skepticism and brand awareness were examined based on a conceptual model.

Design/methodology/approach

A Web-based experiment with 2 (form of promotion: overt versus covert) × 2 (brand awareness: low versus high) between-subjects full factorial design was used. A public sample of 537 participants had participated in the study. The conceptual model was further tested on 106 participants using stimuli of a fictitious brand.

Findings

A two-stage moderated mediation analysis shows that the perceived believability of promotional materials was a significant mediator of the form of promotion and brand evaluations. Consumers showed a higher level of believability toward covert promotion, which, in turn, led to more positive evaluations of the promoted brand. Advertising skepticism and brand awareness were found to significantly moderate the relationship between form of promotion and attitudes toward the promoted brands. A similar pattern of results was obtained when stimuli of a fictitious brand were used.

Originality/value

This research addresses an important issue in marketing communication and extends the understanding of the perception of overt and covert promotions by examining the underlying mediating and moderating variables, which have rarely been explored before. The results guide marketers in developing effective marketing communication strategies for well-known, less well-known and even new brands. It also directs policymakers to consider whether integrated branded content in recipes should be disclosed to protect consumers from surreptitious promotions, which may help to lower consumers’ skepticism toward advertising in the long run.

Citation

Fong Yee Chan, F. (2020), "The perceived effectiveness of overt versus covert promotions", Journal of Product & Brand Management, Vol. 29 No. 3, pp. 321-334. https://doi.org/10.1108/JPBM-06-2018-1912