Product placement 2.0: “Do Brands Need Influencers, or Do Influencers Need Brands?”

An online experiment examined the effects of Instagram posts’ source types and product-placement types on brand attitude and credibility perception. A 2 (source: brand versus Instagram influencer) × 2 (product placement: product-only [explicit product placement] versus influencer-with-product [moderate product placement]) between-subjects factorial experiment (N = 304) tested the effects of the two manipulated factors on source credibility, corporate credibility, and attitude toward brand posts. Two-way ANOVAs indicate a main effect of source types on perceived trustworthiness and interaction effects of product-placement and source types on perceived expertise, corporate credibility, and attitude toward brand posts. Consumers exposed to brand as the source conditions indicated no difference in corporate credibility and brand attitude regardless of product-placement types. In contrast, consumers exposed to Instagram influencer as the source conditions indicated higher corporate credibility and more positive attitude toward brand posts when exposed to the influencer-with-product conditions than when exposed to the product-only conditions. Consumers differently react to product placement on Instagram influencers’ accounts depending on whether the influencers are present versus absent. Consumers react negatively to influencers’ posts when they do not appear with the products they endorse. Parasocial interaction mediates the relationship between product/brand placement types and corporate credibility.