Sponsorship Disclosure in Native Advertising: A Theoretical Framework

Abstract

Native advertising is one of the fastest growing areas of online promotion. After reviewing extant literature via EBSCOhost database, this study draws on Persuasion Knowledge Model and develops a theoretical framework which facilitates a clearer understanding of the relationship between sponsorship disclosure in native advertising and consumer outcome. The framework suggests that sponsorship disclosure has a negative effect on electronic word of mouth (eWOM), and further proposes the interplay between the main effect with brand prominence and the type of device. This is highly relevant to marketer as regulators have been pressuring for the disclosure of native advertising. As this is likely to have detrimental effect to the eWOM, marketer may employ the boundary conditions proposed by this framework to attenuate that negative effect.