Proactive disclosure of negative information and spillover effects in the food industry : an empirical research testing the influence of proactive disclosure of negative information on the attitude towards a focal brand

Proactive disclosure of negative information and spillover effects

in the food industry

An empirical research testing the influence of proactive disclosure of negative information on the attitude towards a focal brand and its competitor within the same product category

Author: Manouk van Groeningen

Student number: 10003099

Institution: Faculty Business and Economics at the University of Amsterdam Qualification: MSc Business Administration – track Marketing

Supervisor: A. Zerres

Second reader: J. Demmers

Date of submission: 29th of January 2016

Statement of originality

This document is written by Manouk van Groeningen who declares to take full

responsibility for the contents of this document.

I declare that the text and the work presented in this document is original and that

no sources other than those mentioned in the text and its references have been used

in creating it.

The Faculty of Economics and Business is responsible solely for the supervision of

completion of the work, not for the contents.

Table of content

2.3 Effects of negative information ...13

2.4 Negative transparency and brand attitude ...15

2.4.1 Mediating effects of functional evaluation and brand trust of focal brand...15

2.5 Negative transparency and competing brands ...18

2.5.1 Spillover effects ...18

2.5.2 Mediating effects of functional evaluation and brand trust of competing brand ...20

2.6 Moderating impact of brand familiarity ...22

2.7 Research model ...23

3. Method...24

3.1 Research design ...24

3.2 Sample ...25

3.3 Procedure ...25

3.4 Development of the stimuli ...26

3.5 Pre-test ...28 3.5.1 Results pre-test ...29 3.6 Manipulation check ...30 3.7 Measures...31 3.8 Statistical procedure ...32 4. Results...33 4.1 Sample characteristics ...33 4.2 Control variables ...33 4.3 Reliability ...34 4.4 Manipulation check ...34

4.5 Descriptive statistics and correlation analysis ...35

4.5.1 Normality ...37

4.6.1 Model 1: Effects on focal brand attitude...37

4.6.2 Direct effect of disclosure of negative information on focal brand attitude (h3) ...38

4.6.3 Mediation by functional product evaluation of the focal brand (h1) and focal brand trust (h2) on focal brand attitude ...38

6.4 Model 2: Effects on the competing brand attitude ...40

4.6.5. Direct effect of disclosure of negative information on the competing brand attitude (h6)...41

4.6.6 Mediation by functional product evaluation of the competing brand (h4) and competing brand trust (h5) on the competing brand attitude ...41

4.6.7 Differences in attitudes focal brand and competing brand ...42

4.6.8 Moderating role of brand familiarity on the functional product evaluation of competing brand (h7a) and competing brand trust (h7b) ...42

4.7 Summary of hypothesis test results ...45

5 Discussion...46

5.1 General discussion ...46

5.1.1 Effects of disclosure of negative information on a focal brand...46

5.1.2 Effects of disclosure of negative information from focal brand on a competing brand ...48

5.1.3 Differences of attitudes within the product category ...51

5.2 Theoretical implications ...52

5.3 Managerial implications ...53

5.4 Limitations and further research ...54

6. References ...56

Appendices ...63

Appendix I – Survey pre-test ...63

Appendix II- Measurement scale items ...67

Appendix III – Regular survey ...69

Appendix IV – Descriptive statistics and normality checks per condition (Control group vs. experimental group) ...80

List of Figures and Tables

Figure 1. Foodwatch’s nominated brands of Gouden Windei 2014. ...8

Figure 2: Conceptual model...23

Figure 3: Model of disclosure of negative information as predictor of attitude focal brand, mediated by functional product evaluation focal brand and trust focal brand. ...39

Figure 4: Model of disclosure of negative information as predictor of attitude competing brand, mediated by functional product evaluation competing brand and trust competing brand...43

Table 1: Overview of the four conditions ...24

Table 2. Means, Standard Deviations, Correlations and Reliabilities ...36

Table 3: Results of the multiple regression analyses (model 1) ...40

Table 4: Results of the multiple regression analyses (model 2)...44

University of Amsterdam | Acknowledgements 6

Acknowledgements

My gratitude goes out to several individuals who enabled me to set up and carry out this research. Firstly, I would like to thank my supervisor Alfred Zerres for his guidance throughout the process of writing this thesis. In the early stage it was not really easy to discover a ‘gap’ in the literature which was interesting and at the same time a managerial and theoretical contribution. With thanks to Alfred’s sincere enthusiasm and expertise and after much consideration, I found a gap which appeals to me. His support and guidance was valuable, if not priceless, during the last half year. Furthermore, a special thanks goes out to my mother Joke, for her patience, accuracy and critical feedback on my thesis. Finally, I want to thank all the participants for completing my questionnaire. Without their participation this research would not have been possible.

University of Amsterdam | Acknowledgements 7

Abstract

Transparency in product information has become increasingly important in the current marketing landscape. This study aimed to examine the influence of proactive disclosure of unfavourable information on the attitude towards a focal brand and its competitors within the same product category. The research examines the likelihood of spill over effects among competing brands. In addition, the mediating variables brand trust and functional product evaluation and the potential moderating role of brand familiarity have been investigated. The experiment was conducted with the use of an online survey. A 2 (message valence: neutral information versus negative information) x 2 (brand familiarity competing brand: unfamiliar versus familiar) between-subjects design is used. The sample consists of 209 Dutch participants that are randomly assigned to one of the four conditions in the study. No support was found for the direct effects of disclosure of negative information on the attitude towards a focal brand nor towards a competing brand. Mediation analysis showed that when consumers are exposed to unfavourable information, functional product evaluation of the focal brand as well as trust in a competing brand significantly decrease. In addition, the results show that only if the competing brand is unfamiliar, it suffers from the disclosure of negative information from the focal brand. This study contributes to the current literature about transparency and spill over effects because there has been done little research on competitive spillover effects in a context in which a firm itself proactively discloses unfavourable information. Finally, there is limited research on the impact of negative information to non-transparent competing brands within the product category.

Key words: transparency, negative product information, competitive spill over effect, product

University of Amsterdam | Introduction 8

1. Introduction

We have entered the age of transparency, where honesty and openness is indispensable. On the 5th of September in 2012 the Dutch Consumers' Association started a campaign called ‘Kletsplaatjes’, to tackle food companies that mislead consumers with inaccurate or incomplete product information (“Over De Actie”, 2012). Up to the present day the Consumers’ Association has made a daily selection on an online ‘wall of shame’ products with false claims about the product, concealed ingredients or just exaggerated product benefits. They have even started a community to encourage consumers to share the most misleading product labels with other people. Not only the Dutch Consumers’ Association insists on transparency in product information but Foodwatch also gives an

annual award “Het gouden windei” to the food brand with the most misleading product claims. First they nominate the five most misleading brands (Figure 1) and afterwards consumers vote what brand deserves the first prize. Apart from these two great organizations that fight for fairness in food, there are hundreds of blogs and review sites where consumers scrutinize and criticize food products.

In the age of transparency, consumers and other stakeholders are getting more critical and they have a greater need for information (Fournier & Avery, 2011). Companies are forced to be more transparent and it is becoming more and more difficult to conceal any information, since the internet has made information easily accessible for everyone. Acting in a transparent way has not only become a requirement for companies these days, but previous studies have also shown that the effects of transparency could be beneficial (Bhaduri & Ha -Brookshire, 2011; Buell & Norton, 2011; Carter & Curry, 2010). For instance, the study of Carter and Curry (2010) has shown that transparency about price allocation leads to higher purchase intention and willingness to pay. But what is even more important, it has been found that proactive disclosure of moderate unfavourable information can be used as a marketing tool which leads to higher product choice and willingness to pay (Demmers, Erbé, Van Strijp, & Wientjes, 2015). Given that brands are nowadays more likely to be honest even about inferior product features, the Figure 1 : Foodwatch’s nominated brands of Gouden Windei 2014.

University of Amsterdam | Introduction 9 question arises how proactive negative transparency affects competing brands in the same product category that do not reveal adverse information. It seems plausible that consumers will use the unfavourable information disclosed by one brand during the evaluation of similar products offered by other brands. To exemplify, when consumers infer that the disclosed unfavourable product information provided by a focal brand might be a common characteristic within the product category, it can be expected that the provided information of the focal brand can play a role in the brand evaluation of the competing brand. The idea of transferring information or perceptions, refers to the concept of ‘spillover effects’ (Ahluwalia, Burnkant, & Unnava, 2001; Simonin & Ruth, 1998). Some initial findings from previous research seem to provide evidence that competitive spillover does occur. Roehm and Tybout (2006) researched spillover effects in a scandal context and found that competitors of a scandalized brand were considered guilty by association in the same product category. Furthermore, Janakiraman, Sismeiro and Dutta (2009) demonstrated that consumers transfer quality perceptions across competing brands. Despite the theoretical research on spillover effects, it is still unclear whether spillover can also occur between competitors when one of the brands itself proactively discloses unfavourable information instead of a third party, which is the case in a scandal context.

Intrigued by the gap in the transparency and spillover effect literature, the research question of this study was:

How does proactive disclosure of negative information from a focal brand influence the attitude towards a focal brand and its competitor within the same product category?

And which of the two brands within this product category is evaluated better in terms of attitude in the end?

This research contributes to the literature about spillover effects as well as about transparency. First, it contributes to spillover effect literature. While earlier studies focused on spillover effects within a context where a scandal was unveiled by others, this study addresses potential spillover from a brand to another brand in a context in which a firm itself proactively discloses unfavourable information. Furthermore, there has been done little research on spillover among competing brands in one product category. Previous literature has especially focused on the spillover from one attribute to another of the same brand (e.g., Ahluwalia, Burnkant, & Unnava, 2001), spillover in brand alliances (e.g., Dickinson & Barker, 2007; Simonin & Ruth, 1998) brand extensions (e.g., Loken & John, 1993) and brand portfolio (e.g., Lei, Dawar & Lemmink,

University of Amsterdam | Introduction 10 2008). In the few studies which focus on spillover among competitors (Roehm & Tybout, 2006; Janikaraman et al., 2009), only spillover effects of extreme negative information (i.e., brand scandal) or positive of neutral information were investigated, whereas this study focuses on mildly unfavourable information. Additionally, we also articulate the moderating role of brand familiarity on spillover effects, where it is expected that unfamiliar brands will experience stronger spillover effects than familiar brands. Our second contribution is to the transparency literature. Given the fact that the increased importance of transparency in product information is a recent development in the current marketing landscape, there is only limited research on the impact of transparency on brand evaluations. Whereas previous literature about transparency mainly focused on the effects of transparency on consumer behaviour or evaluations related to the particular transparent brand, in this study much attention too is paid to the effect of negative information on non-transparent competing brands within the product category.

In addition to the academic relevance, the findings of this research could be relevant for brand managers to gain a better understanding of the effects of proactive disclosure of unfavourable information on attitude towards competing brands within a product category. If it indeed turns out that negative spillover occurs across competing brands, managers of food companies should anticipate and have to ensure that they are the first brand in the product category that voluntarily discloses negative product information, instead of experiencing negative spillover. Furthermore, marketers could take into account that being transparent is not only a way to overcome competitive negative spillover, but it also seems plausible that consumers appreciate the perceived honesty and will evaluate a transparent brand more positive than a non-transparent competing brand.

This study is focused on transparency and its effects in the food sector, since trust in food is currently challenging (Beulens, Broens, Folstar, & Hofstede, 2005; Grunert, 2005). After sequential food scandals and incidents, consumers demand greater transparency in understanding what is in food, where it has come from and its quality (Beulens et al., 2005). For instance, food companies could not merely claim that light products are lower in fat or calories, but they also need to inform consumers that these light products may contain additional thickeners, artificial flavours or other potentially unwanted ingredients in order to compensate for the loss of flavour.

University of Amsterdam | Introduction 11 In terms of organization, this essay will consist of four chapters. The first part of the essay will provide a review of the relevant literature about transparency effects and spillover mechanism, in order to gain a better understanding of the different concepts. The next chapter outlines the data collection procedure and research method. Subsequently, the results based on the collected data will be explained in the fourth chapter. The final chapter presents the discussion of the findings of the research and provides implications, limitations and suggestions for further research.

University of Amsterdam | Literature review 12

2. Literature review

This chapter provides an overview of the literature on negative transparency and spillover effects. The first part of the literature focuses on the concept of transparency, processing of negative information and the effects of negative transparency on brand evaluations and consumer behaviour. The second part of the literature review, addresses the gap in the literature and focuses on the effects of transparency on attitudes towards competing brands in the same product category that do not reveal adverse information. Effects of proactive disclosure of unfavourable information on the evaluation of competitors are explained by the potential underlying mechanism ‘spillover’. Furthermore, effects of negative transparency on brand attitudes are determined, taking into account brand trust, functional product evaluation and brand familiarity.

2.1 Transparency

It is necessary to clarify accurately what is meant by the term transparency. The following section discusses definitions and impact of transparency. The Cambridge Business Dictionary (2014) defines transparency as “A situation in which business and financial activities are done in an open way without secrets, so that people can trust that they are fair and honest”. Lamming, Caldwell, Harrison and Philips (2001) describe transparency as the ability to ‘see through’ and emphasize that transparency implies sharing information that is usually not shared between two business partners. Furthermore, Zhu (2002) defines information transparency as the degree of availability, accessibility and visibility of information. Both descriptions indicate core values of transparency as openness about any information an organization has. Vishwanath and Kaufman (2001) state that information is transparent when it is accessible, qualitative, reliable and relevant. Information needs to be available and easily accessible for stakeholders. Lamming et al., (2001) found three aspects of transparency: degree of transparency, direction of transparency and distribution of transparency. The degree of transparency can vary from completely transparent to translucent in some respects, or partially shared or not open at all. Direction of transparency refers to negative or positive transparent information. Distribution of transparency could be direct or indirect, meaning that transparency may be present in a direct relationship or an indirect buyer-supplier relationship.

2.2 Information processing

As mentioned in the previous section, transparency can be classified into different directions; negative or positive transparent information (Lamming et al., 2001).

University of Amsterdam | Literature review 13 This research will focus on the effect of negative transparency on consumers’ attitudes towards brands. Throughout this thesis, the term transparency is used to refer to voluntary disclosure of negative information from the brand. The information integration theory provides a theoretical framework for understanding the effects of information on attitudes and behaviour. According to the theory, attitudes are changed and formed through the integration of new information pieces with existing cognitions or thoughts. Anderson (1983) pointed out that each piece of information has two qualities which both influence our attitude; value and weight. Information that is high in value is both highly favourable and unfavourable and the weight refers to the perceived usefulness of the information. Once people obtain this new information, those new pieces of information will affect people’s attitude.

Furthermore previous research suggests that negative information will be processed differently than positive or neutral information (Herr, Kardes, & Kim, 1991; Skawronski & Carlson, 1989). In earlier research it has been found that negative information has a stronger impact on attitudes and behaviours than positive information (Baumeister, Bratslavsky, Fickenauer, & Vohs, 2001; Rozin & Royzman, 2001). Skowronski and Carlston (1989) argue that the greater impact of negative information on evaluation can be declared by the fact that negative information is considered to be more diagnostic than positive information. Diagnosticity refers to perceived relevance of information during decision making (Skowronski & Carlston, 1989). For instance, when consumers get negative related product information, they are inclined to classify the product as low in quality. In contrast, positive or neutral product information is less valuable for categorizing products because this positive information is usually provided for high, average and low-quality products. The information integration theory assumes that when people are exposed to new unfavourable information, positive attitudes tend to become less positive and attitudes that are negative are likely to become more negative and vice-versa. More research too has demonstrated that positive information leads to favourable evaluations whereas negative information leads to unfavourable evaluations (Lee, Park, & Han, 2008; Smith & Petty, 1996).

2.3 Effects of negative information

In contrast to the basic principle of the information integration theory, a small group of other studies suggest an opposite effect which implies that disclosure of unfavourable information could actually lead to more favourable brand evaluations (Crowley & Hoyer, 1994; Eisend 2006). On the basis of a meta-analysis, Eisend (2006) found that providing negative information

University of Amsterdam | Literature review 14 in advertising messages enhances source credibility. The attribution theory is used as possible explanation for this effect. The theory deals with how individuals interpret events or behaviour to arrive at a reasonable explanation or cause (Jones & Davis, 1965). As is supported by the finding of Eisend (2006); when negative information is included in a persuasive message, a consumer is more inclined to think that the advertiser is telling the truth, which strengthens credibility towards the source and reduces negative cognitive responses. The above described positive effect on brand credibility works till a certain level of the included amount of negative information. Eisend (2006) indicated that a trade-off takes place; favourable effects of disclosure of adverse information will only arise if the rewards of perceived honesty may outweigh the losses of negative information about product attributes. Specifically, in Eisend’s (2006) study was found that including less than fifty percent of moderate negative information does not harm positive credibility effects, whereas more negative information will lead to negative effects and a decrease in attitude. Even more remarkable was that two-sided messages whereby an unfavourable attribute was highly correlated with a favourable attribute in a claim, were found more persuasive, than when only favourable attributes in claims were presented. If a claim is said for example higher price and high quality, consumers might refrain from this trade-off. In summary, the results of the study showed that two-sided messages are effective, particularly they enhance source credibility, reduce negative cognitive responses and have positive impact on brand attitude and purchase intention.

The study of Demmers et al. (2015) supported not only the results of Eisend (2006) but also found additional results that suggest that the inclusion of unfavourable information also positively affects actual consumer behaviour. In their research is has been found that negative information being disclosed by the firm, leads to higher willingness to pay and product preference, compared to messages without the additional negative information. The authors accredit this effect not only to the increase in brand trust but the authors assume that self-disclosure of negative information leads to a change in meaning of negative information based on the stealing thunder theory. The stealing thunder strategy is a self-disclosure strategy which refers to the idea that an organization in crisis situation ‘steals the thunder’ by publishing its own crisis before other parties discover and release the crisis (Arpan & Roskos-Ewoldson, 2005). Arpan and Roskos-Ewoldson (2005) found that self-disclosure in crisis context leads to an increase in brand credibility associated with the fact that participants perceive the crisis as less severe. In line with the findings of Arpan and Roskos-Ewoldson (2005), the study of Demmers

University of Amsterdam | Literature review 15 et al. (2015) demonstrated that source disclosure is crucial as well in product valuation: disclosing unfavourable information only leads to higher willingness to pay if the brand itself discloses the information compared to disclosure by a consumer. More specifically, the underlying mechanism of the positive effect of disclosure of unfavourable information might be explained by the change in a consumer’s perception of negative information. Participants who received the disclosed unfavourable information from the brand itself, did perceive the information significantly less negative and at the same time more relevant in comparison with the condition where information was disclosed by a consumer (Demmers et al., 2015).

2.4 Negative transparency and brand attitude

This study examines the effect of self-disclosure of unfavourable information on the attitude towards the focal brand and its competitor. Brand attitude is a construct which is largely investigated in branding literature. Studies have been trying to investigate both the

antecedents and the consequences of brand attitude (Berger & Mitchell, 1989; Chang, Hsu, & Chung, 2008; Park, Jaworski & Maclnnis, 1986). Wilkie (as cited in Keller, 1993) clarifies that brand attitudes refer to consumers’ overall evaluation of a brand, which often form the foundation for consumer behaviour, for instance in brand choice. Furthermore, brand attitude can be seen as an expression of a given value towards a brand. Several studies suggest that cognitive and affective components predict brand attitude formation and change (MacKenzie & Spreng, 1992; Syvia & Chan-Olmsted, 2005). Specific beliefs related to the object (e.g. perceived usefulness or helpfulness) were associated with the cognitive component, whereas the affective component is derived from the emotional or affective reaction of the consumers towards a product or brand (Syvia & Chan-Olmsted, 2005). This research interprets the variable ‘functional product evaluation’ as a cognitive aspect and the variable ‘brand trust’ as an affective aspect to understand better, how brand attitudes are established once consumers are exposed to negative information. Following this line of reasoning, it is expected that after disclosure of information the attitude is formed by two distinct pathways, via brand trust and via functional product evaluation.

2.4.1 Mediating effects of functional evaluation and brand trust of focal brand.

Drawing upon a typology of product benefits from a study of Sheth, Newman and, Gross (1991), functional product evaluation can be supported by functional benefits of a product which refers to the advantages of product consumption. In other words, functional product evaluation refers to what a product concretely can do for a consumer. These functional benefits are often related

University of Amsterdam | Literature review 16 to rather basic motivations, such as safety needs, cleaning, satiating hunger and quenching thirst. In earlier research is found that when products fulfil functional needs, people will evaluate the product and the brand more favourable than when needs are not fulfilled (Homburg, Koschate, & Hoyer, 2006; Voss, Spangenberg, & Grohmann, 2003).

Since this research focuses on effects of transparency in the food industry, the functional evaluation of food will be examined. On the basis of the study of Grunert (2005), food quality perceptions are used as indicators for functional benefits. Four central concepts were found which establish consumers’ food quality perception: taste, health, convenience and process characteristics as natural or organic production. This study will focus on functional evaluation associated with perceived healthiness. An explanation for this choice is that in earlier research is found that consumers are more concerned about what ingredients are in food and whether these (artificial) ingredients involve health risks (Grunert, 2005; Kozup, Creyer, & Burton, 2003). Consumers demand ingredient transparency and therefore in our study it is researched how proactive disclosure of information about the presence of sweeteners and related health risks influence brand attitudes. Studies in the field of communication about food quality and safety provide a starting point for understanding the influence of health claims and nutrition information on consumers’ evaluation. Roe, Levy and Derby (1999) demonstrated that consumers had more favourable evaluation of the healthiness of a product and higher purchase intentions when favourable health claims and nutrient claims were presented. As could be expected, Kozup et al. (2003) found that unfavourable nutrition information and unfavourable health claims lead to a negative product evaluation and participants indicated that they perceived higher disease risks. Following this line of reasoning, it can be expected that the inclusion of unfavourable health and nutrition information leads to lower functional product evaluation due to higher perceived health risks. This leads to the following hypothesis:

H1: Functional product evaluation mediates the relationship between disclosure of information and brand attitude, such that disclosure of negative information leads to a decrease in functional product evaluation which in turn reduces the attitude towards the brand.

Not only functional product evaluation but also brand trust is an important factor that could affect consumers’ brand attitude. Brand trust can be described as a feeling of security felt by the consumers to rely on the ability of the brand (Delgado-Ballester & Munuera-Alemán, 2005). Consumers can trust a brand in a way that they believe that the firm acts in the best interests of the customer instead of the best outcomes for the firm.

University of Amsterdam | Literature review 17 Doney and Cannon (1997) state that reliability, safety and honesty are important factors that consumers incorporate in their operationalization of trust. The fact that brand trust positively affects brand attitudes is demonstrated in previous research (Delgado-Ballester & Munuera-Alemán, 2005; Erdem & Swait, 2004). According to Chaudhuri and Holbrook (2001) brand trust can serve as a tool while consumers have to cope with uncertainty. Trust in a brand can be considered very important in the buying decision process which is positively related to repurchase and attitudinal loyalty (Chaudhuri & Holbrook, 2001).

Earlier research examined that transparent information in general leads to an increase in trust towards a brand (Bhaduri & Ha-Brookshire, 2011; Christensen, 2002). A potential declaration of above described findings could be that consumers seek information as a strategy for reducing risks (Locander & Herman, 1979). It is plausible that consumers will experience less risk during decision making processes when complete information is provided, even with the inclusion of negative information. For instance, consumers who are completely informed about a product are less suspicious and will have more trust in a brand. Furthermore, as earlier discussed by Eisend (2006), two-sided advertisements providing negative information leads to higher message and source credibility. More important, not purely providing unfavourable information but rather self-disclosure of unfavourable information (e.g. crisis) will be rated as more credible as opposed to having the information first disclosed by another source (Arpan & Roskos-Ewoldsen, 2005). It seems that brand credibility is closely related to brand trust, whereas trust refers to confidence in a business, credibility refers to the quality of being believable ( Erdem, & Swait, 2004). Based on previous findings, it can be expected that the inclusion of negative product related information leads to higher brand trust due to risk reduction and increased brand credibility. This leads to the following hypothesis:

H2: Brand trust mediates the relationship between disclosure of information and brand attitude, such that disclosure of negative information leads to an increase in brand trust which in turn has a positive relationship with the attitude towards the brand.

Following the first hypotheses, functional product evaluation and brand trust mediate the relationship between disclosure of information and brand attitude. The two different paths that lead to attitude formation have contradictory predictions; while trust towards the brand is expected to increase after providing unfavourable information, functional product evaluation is expected to decrease. When people have conflicting beliefs, a balance must be found to arrive at a final evaluation. Based upon the findings of Eisend (2006) it is assumed that the gains of

University of Amsterdam | Literature review 18 higher brand trust will outweigh the losses of lower product functional evaluation which eventually lead to an increase in attitude towards the brand. This results in the following hypothesis:

H3: The attitude towards the brand is higher under negative (versus neutral) transparent conditions.

2.5 Negative transparency and competing brands

In the prior chapter the concept of negative transparency and its effects on the attitude towards the focal brand were discussed. Whereas this part will focus on the effects of disclosure of unfavourable information on attitudes of competitors. This study will elaborate on the existing theory about spillover effects of scandals on competing brands and will propose the hypotheses that will investigate the spillover effect in proactive disclosure context.

2.5.1 Spillover effects

Spillover refers to the concept in which ‘information and existing perceptions influence beliefs that are not directly addressed by or related to the original source or perception object’(Janakiraman et al., 2009, p. 476). The business dictionary declares spillover as ‘a secondary effect that follows from a primary effect and may be far removed in time or place from the event that caused the primary effect’. Previous literature found that the presence of spillover effect has great influence on consumers’ evaluations of products and brands (Lei, Dawar, & Lemmink, 2008; Janakiraman et al., 2009). As mentioned before, spillover effects are widely researched in earlier studies focused on spillover in brand extensions (e.g., Loken & John, 1993) and brand portfolios (e.g., Lei et al., 2008). For instance, positive spillover effects are used as marketing tool in the success of line extensions, whereby consumers transfer high quality perceptions across products which carries the same family brand. When a brand introduces a new product, consumers tend to be less unsecure when evaluating the quality of the new product because they could apply the perceived quality of other products of the same brand.

Spillover can also entail considerable risks when negative information is involved. To exemplify, if a company or brand caused environmental damage with one product, it is very likely that people assume that other products of the brand also harm the environment. Perceived intentions of a company will be transferred and the underlying assumption could be that a company sets certain standards that are valid within the company. In the context of spillover

University of Amsterdam | Literature review 19 between different brands in a product category, not the company but the industry is the connection that predicts how people evaluate competitors.

In this study we rely on existing literature that investigates competitive spillover. Roehm and Tybout (2006) identified under which conditions a brand scandal spills over and negatively affects the product category and competitors’ attitudes. On the one hand competitors might suffer from the associated guilt of the scandalized brand. On the other hand, a scandal might be considered belonging exclusively to the scandalized brand. The authors clarify that scandal spillover among competitors is moderated by both accessibility and diagnosticity. The accessibility-diagnosticity framework (Feldman & Lynch, 1988) provides that strength of existing links in a consumer’s mind combined with new information affects the decision-making process. Accessibility in this context means that elements as brands, product attributes and categories belong to a network of associations and these elements can activate each other when the links between them are strong. The more accessible a brand or an attribute is, the easier it is memorized (Feldman & Lynch, 1988). As earlier described, diagnosticity refers to the perceived relevance of information during a decision-making process (Skowronski & Carlston, 1989). Earlier research found that spillover is especially likely for negative information, which is considered more diagnostic than positive information (Ahluwalia, Burnkrant, & Unnava, 2001). Roehm and Tybout (2006) claim that if one brand is considered informative for another brand, the information referring to the first brand would be applicable to the other brand. The authors extend this claim to a scandal context, where they predict that spillover to a competitor will only occur when the competitor is accessible and when the scandal is perceived as diagnostic for the competitor. In other words, similarity between two brands is not the only predictor for spillover, merely when the scandal is related to an attribute that is shared with the competing brand, spillover occurs. Their assumptions were supported by their findings focused on brands in the fast food category. Participants perceived Mc Donald’s, Burger King and Dairy Queen as similar fast food brands but a scandal containing hamburgers at Burger King only spills over to Mac Donald’s. An explanation for this finding might be that the hamburger scandal (attribute) was not in common with the brand Dairy Queen, that sells especially ice creams. In addition, Janikaraman et al. (2009), who focussed on quality perception spillover across competing brands, also found that spillover only occurs when brands and their products are perceived in a similar way.

University of Amsterdam | Literature review 20

2.5.2 Mediating effects of functional evaluation and brand trust of competing brand

Based upon earlier research about negative information disclosed by others, this study theorises that spillover on competitors also occurs in a context where a brand proactively discloses unfavourable information. The studie of Roehm and Tybout (2006) suggest that consumers would assume that comparable brands in the same industry use the same practices as the scandalized brand. If we apply this assumption to our research, we expect that when one brand shares negative information about the product that should apply for the other brands in the category as well. In addition, if the competitors would use different practices, it is to be expected that the competitor should inform consumers to distinguish itself. This results in the following hypothesis:

H4: Functional product evaluation mediates the relationship between disclosure of information from a focal brand and the attitude towards a competing brand, so that disclosure of negative information from a focal brand leads to a decrease in functional evaluation towards a product of a competing brand, which in turn decreases the attitude towards the competing brand.

To further identify the effect of negative transparency from a focal brand on attitudes towards its competitors, it should be investigated how trust of a competing brand will be affected. Given research on spillover effects in self-disclosure context is scarce, this study bases assumptions on previous literature about spillover effects of unfavourable information disclosed by third parties. Lei et al. (2008) examined negative spillover of product harm crisis in brand portfolios. In their experiment, participants were exposed to a crisis story about one of the three subbrands that were investigated and afterwards brand attitude and brand trust of the subbrands and the parent brand were explored. Their results showed that subbrands suffer from each other’s crisis and as a consequence brand evaluation and brand trust decreased. Whereas in scandal and crisis context it is argued that both the scandalized brand and related brands will experience a decrease in brand trust due to spillover effects, in self-disclosure context this study expects different effects on brand trust. Based on previous literature about effects of self-disclosure of negative information (Arpan & Roskos-Ewoldsen, 2005; Eisend, 2006) it is found that while trust towards the focal brand will increase, this study assumes that an opposite effect will occur for its competitors. When consumers infer that the disclosed unfavourable product information provided by focal brand might be a common characteristic within the product category, it can be expected that they could be more suspicious towards the competing brand which results in lower

University of Amsterdam | Literature review 21 brand trust. More important, goodwill is shown by the transparent brand by providing honest information even without having the obligation to do that. It can therefore be assumed that the demonstrated ‘best practice’ of the focal brand could have an adverse effect on trust of competitors that do not self-disclose. Furthermore, the consequence of spillover of negative functional evaluation on the competing brand will affect brand trust: when consumers perceive the product as less healthy it is plausible that confidence in the brand will decrease. In our study it can therefore be assumed that that the function of signaling of best practice and the negative functional evaluation would drive the effect on brand trust. This leads to the following hypothesis:

H5: Brand trust mediates the relationship between disclosure of information from a focal brand and the attitude towards a competing brand, so that disclosure of negative information from a focal brand leads to a decrease in trust towards a competing brand, which decreases the attitude towards the competing brand.

Following the previous hypotheses, functional product evaluation and brand trust mediate the relationship between disclosure of unfavourable information of the focal brand and the attitude towards competing brands. It could be argued that the two different paths lead to attitude formation, wherein both trust towards the competing brand and functional product evaluati on seem to decrease. With the presumption that brand trust and functional product evaluation positively affect brand attitudes (Ballestor & Alemán, 1967; Erdem & Swait, 2004; Homburg et al., 2006; Voss et al., 2003) it can be assumed that the attitude towards the competing brand will decrease. This leads to the following hypothesis:

H6: The attitude towards the competing brand is lower under negative (versus neutral) transparent conditions of the focal brand.

According to the above mentioned hypotheses, it could be argued that consumers who were exposed to negative information about the focal brand will have a more positive attitude towards the focal brand in comparison with the competitor that does not self-disclose. Our assumption is supported by a unanticipated finding of the study of Roehm and Tybout (2006) that suggested that when spillover occurred, the scandal was less detrimental to the scandalized brand. Obviously, if consumers conclude the scandal might be a common practice within the industry, they may relativize their attitude of the scandalized company

University of Amsterdam | Literature review 22

2.6 Moderating impact of brand familiarity

Previous research has recognized the important role of brand familiarity in (negative) information processing and brand evaluation (Alba & Hutchinson, 1987; Dawar & Lei, 2009; Pham & Muthukrishnan, 2002). Brand familiarity refers to the number of brand related direct or indirect experiences that consumers have had (Alba & Hutchinson, 1987). These brand related experiences can range from exposure to the brand in advertisement, in media or in a store to purchase or usage of the brand. Familiar brands have shown to be more easily recalled and better liked by consumers than unfamiliar brands (Dahlen; Rindflesich & Inman, as cited in Dawar & Lei, 2009). More specifically, brand familiarity may even act as a buffer against the impact of negative information on brands. Pham and Muthukrishnan (2002) declared this effect by the fact that brand familiarity provides easier accessibility of prior attitudes toward the brand. For instance, when a crisis occurs to a familiar brand, consumers’ earlier experiences with the brand will make it easier to retrieve the pro-attitudinal information, which in turn diminishes the influence of the crisis information. In contrast, when a crisis occurs to an unfamiliar brand, the crisis information becomes the primary information on which the brand is evaluated. In addition, it has been found that consumers tend to perceive familiar brands less responsible for a crisis than unfamiliar brands, which translates into a lesser negative impact on brand evaluations (Dawar & Lei, 2009).

That brand familiarity impacts brand evaluations has been shown in previous research (Dawar & Lei, 2009; Pham and Muthukrishnan, 2002) but this study focuses on the moderating role of brand familiarity in spillover effects. Under the condition that familiarity in valence is neutral, this study expects that brand familiarity reduces the effect of negative spillover, because the new transferred negative information basically updates the existing information about a brand. Whereas, less familiar brands associated with not so well developed knowledge are more likely to change in brand evaluations since the disclosed negative information that spills over, becomes the only relevant piece of information. Simonin and Ruth (1998) researched the spillover effects of brand alliances and found that brands less familiar than their partners experience stronger spillover effects than their partners. Based upon earlier research is it is likely to assume that when negative spillover occurs from the focal brand to its competitor, brand familiarity of the competitor can act as a buffer against the associated negative information. This leads to the following hypothesis:

University of Amsterdam | Literature review 23 H7A: The effect of disclosure of negative information from a focal brand on functional product evaluation of a competing brand is moderated by brand familiarity. Disclosing negative information will have a stronger impact on product evaluation for unfamiliar competitor s than familiar competitors.

Following hypothesis 7A, it is plausible that consumers have more confidence in familiar brands than unfamiliar brands as a result of the disclosure of unfavourable information. The experienced lack of confidence in the competing brand may be the first or one of only a few experiences consumers have with the unknown brand, which will result in lower brand trust. This leads to the following hypothesis:

H7B: The effect of disclosure of negative information from a focal brand on brand trust of a competing brand is moderated by brand familiarity. Disclosing negative information will have a stronger impact on brand trust for unfamiliar competitors than familiar competitors.

2.7 Research model

In prior sections seven sets of hypotheses were established. An illustration of the hypothesized relationships between disclosure of negative information and focal brand attitude and attitude towards its competitors is presented in the research model in figure 2.

University of Amsterdam | Method 24

3. Method

The conceptual model and hypotheses were developed and presented in the previous section. This chapter describes the methodology, including the research design and a description of the sample. Subsequently, the procedure, the development of the stimuli and the measurements of the variables are described. In the last section, a statistical procedure is discussed.

3.1 Research design

In order to test the hypotheses a quantitative research method was used. A 2 (message valence: neutral information versus negative information) x 2 (brand familiarity competing brand: unfamiliar versus familiar) between-subjects design is used. The independent variable is disclosure of negative information, which can either be absent or present and the dependent variable is brand attitude. The mediating variables are trust and functional product evaluation and the moderator is brand familiarity of the competing brand. It was decided to only examine the effects of the moderating role of brand familiarity of the competing brand because in this study the main focus is on the effect of negative information from a focal brand on non-transparent competing brands. In the study participants were randomly divided into four conditions (see table 1). In the first condition a neutral framed advertisement about a focal brand and a positive framed advertisement about a familiar competing brand were presented and in the second condition a negative framed advertisement about a focal brand and a positive advertisement about a familiar competing brand were presented. In the third condition a neutral framed advertisement about a focal brand and a positive advertisement about an unfamiliar competing brand were provided. Finally, in the fourth condition a negative framed advertisement about a focal brand and a positive framed advertisement about an unfamiliar competing brand were provided. The conditions in which no negative framed advertisements about the focal brand was showed, served as control groups.

Table 1: Overview of the four conditions

Neutral frame Negative frame

Familiar competing brand Condition 1: n= 52 Condition 2: n= 53

University of Amsterdam | Method 25

3.2 Sample

Non-probability sampling techniques have been used to reach participants. The data collection began on the 14th of December and ended on the 23rd of December. The survey is written in Dutch and only distributed among Dutch people. Firstly, the national homogenous sample was employed to avoid cultural differences in food perception and eating behaviour. Secondly, the brands of yogurt, which are used in the questionnaire are sold in the Dutch supermarkets. Before collecting data, the sample size was determined. According to Saunders, Lewis, and Thornhill (2012) a sample size of at least 30 participants is required to have a normal distribution. In this study, the sample size should thusbe at least 120. Final analysis was done with a total of a 209 participants, so the criterion of Saunders et al. (2012) was met.

3.3 Procedure

Participants were gathered by sending an invitation through private mail and via social media as Facebook. The participation was voluntary and without incentive. The introduction of the survey described the context of the research and contained an anonymity statement, emphasizing the confidentiality of the answers. Participants were not informed about specific research goals. The survey consisted of different sections.

First, participants were exposed to two different advertisements on the same page: one advertisement about the focal brand (neutral or negative framed) and one advertisement about a competing brand (which was familiar or unfamiliar). These advertisements were introduced on the same page to ensure that participants can compare both advertisements. The presentation order of the two different advertisements was counterbalanced (on top of the page versus on the bottom of the page) to avoid sequential measurement.

The second section of the survey was focused on the focal brand and the advertisement of the focal brand has been shown again on the top of the page to avoid confusion. Subsequently, with regard to the showed advertisement, questions were asked about the perceived brand trust, functional evaluation of the product and brand attitude. In the third section the competing brand is introduced in the same way. First, the advertisement about the competing brand was shown again, followed by questions about perceived brand trust, functional evaluation of the product and brand attitude.

University of Amsterdam | Method 26 Next, a manipulation check was included to test whether the manipulations of disclosure of negative information and brand familiarity were well understood. In the last section, demographic variables of the participants were asked, such as age, gender and level of education.

After survey completion, participants were debriefed that the presented advertisements were fictitious and specially developed for this study. Finally, the survey ended with contact details of the researcher for further questions or comments and participants were thanked for participation. The complete questionnaire is included in the appendix.

3.4 Development of the stimuli

Stimulus material need to be developed in order to set up the survey. An important starting point was the selection of an industry for the study. For several reasons, it was decided that the food sector was appropriate for this research. The first reason is that transparency in food information has been a much debated topic for some time now (Beulens, Broens, Folstar, & Hofstede, 2005; Grunert, 2005). Based upon a report from Price Waterhouse Coopers (2015) it seems that European consumers are increasingly concerned about the safety of their food. Consumers demand greater transparency in understanding what is in food, where it has come from and its quality (Beulens et al., 2005). Moreover, since this study is focused on the influence of proactive disclosure of negative information, it is most suitable to choose a food category which has a more or less neutral reputation prior to the study. For that reason, the dairy industry is an appropriate choice.

Brand familiarity

After the selection of the food industry, comparable familiar yogurt brands were selected to use in the study. The yogurt brands Activia and Optimel were carefully chosen because they offer comparable yogurt products and both can be grouped under the low-calorie dairy products. Furthermore, the brands can be considered as competitors in The Netherlands and both position their dairy products as a healthy choice (FrieslandCampina wordt Koninklijke onderneming, 2009). The two selected familiar brands were counterbalanced in the experiment to avoid the use of specific brand-treatment combinations. Aside from the use of familiar brands, an unfamiliar brand was used in the study. To ensure that no single participant would recognize the chosen unfamiliar brand, a fictitious brand was used. Based upon the pre-test, the fictitious brand ‘Pure Yog’ was perceived as most unfamiliar brand. Because the participants had to believe that the

University of Amsterdam | Method 27 fictitious brand was comparable with the familiar brands, a brand name was chosen from which it could be inferred that it was a brand that sells yogurt.

Advertisement focal brand.

In order to manipulate proactive disclosure of negative information, two types of advertisements were developed: a neutral framed advertisement for the control condition and a negative framed advertisement for the experimental condition. To better research potential spillover effects only familiar brands were used as focal brand in the advertisements. Because consumers consider familiar brands much more as a frame of reference in a product category than less familiar brands that are associated with not so well developed knowledge. To obtain the most realistic representation of the advertisements and to ensure that the participants thought that the information was provided by the brand itself, the menu bar of the actual website of Activia and Optimel was copied, to create the impression that print screens of online advertisements have been taken from the websites. The self-constructed products named ‘Activia 0%’ and ‘Optimel 0%’ were introduced and the product information was based upon diverse elements of existing advertisements about dairy products to make it more realistic. The participants in the control and experimental condition both received information, which emphasized that the yoghurt contains 0% fat and no sugar.

Subsequently, in the neutral framed advertisement it is communicated that artificial sweeteners are used to maintain the sweet taste. In the negative framed advertisement the presence of sweeteners as well as additional information about related health risks as diabetes due to increased production of insulins is communicated. In order to maintain credibility of the proactive disclosure of negative information, in the concluding sentence it is mentioned that the particular brand is aware of these related health risks of sweeteners and will continue to innovate healthier products. Both types of advertisements contain identical design, font, color and food shot in order to ascribe differing effects to the experimental manipulation. The only difference is the valence of the product information.

Advertisement competing brand

Given the fact that we should treat the focal and competing brand equally in the experiment, a third advertisement about the competing brand is developed. All participants of the control and experimental condition were exposed to the same product information about the competing

University of Amsterdam | Method 28 brand. To measure brand familiarity, participants were randomly assigned to a condition where an advertisement about a familiar competing brand (Activia/Optimel) was showed or a condition where an advertisement about an unfamiliar competing brand (Pure Yog) was showed. Once more the brands Activia and Optimel were counterbalanced. To ensure that the advertised product of the competitor was comparable with the advertised product of the focal brand, a light product was introduced: ‘Activia Light’, ‘Optimel Light’ or ‘Pure Yog Light’. The third advertisement features a typical advertisement which sums up all the positive aspects ‘no sugar and no fat’ and nothing was reported about sweeteners. The text is comparable with the neutral framed text of the focal brand but the addition of sweeteners is not mentioned. To illustrate clearly a difference in the advertisement of the focal and the competing brand, a different design, font, colour and food shot was chosen.

3.5 Pre-test

Prior to the experiment, a pre-test was conducted to test if the chosen stimuli was interpreted in the right way. The pre-test had four main objectives. First, to test if participants perceive the chosen brands familiar or unfamiliar. Second, to ensure that the stimuli was perceived credible and subsequently to test the manipulated message valence (neutral versus negative). Important was that the negative framed advertisement was not perceived extremely negative, since the study focused on the effects of mildly unfavourable information. Finally, pre-attitudes of familiar brands were measured, to ensure that participants in general would not have an extreme negative or positive attitude towards these brands.

Twenty five participants filled out the pre-test, which was an online survey (see appendix). A total of four brands were selected for the pre-test. Two familiar brands (Activia and Optimel) and two fictitious brands (Alunt and Pure Yogh) were used. Firstly, the participants were asked if they were familiar with the four brands: Activia, Optimel, Pure Yog en Alunt. To measure brand familiarity, the scale of Somonin and Ruth (1998) (a = .94) was used on a seven point Likert scale (very strongly disagree [1] to very strongly agree [2]) with the following items: (1) “I am familiar with this brand”, (2) “I recognize this brand”, (3) “I have heard of this brand before”. Secondly, the attitudes towards the familiar brands were measured with the use of a seven-point semantic differential scale developed by Stuart, Shimp and Engle (1987). Afterwards the participants were random allocated to one of the four conditions where a different advertisement was showed: 1) Activia neutral framed advertisement, 2) Activia negative framed advertisement, 3) Optimel neutral framed advertisement, 4) Optimel negative

University of Amsterdam | Method 29 framed advertisement. After reading one of the four advertisements, the participants were asked to fill in a questionnaire which measured message credibility and perceived message valence. Message credibility was measured on a seven-point Likert scale using five items, (believable, accurate, trustworthy, unbiased and complete). The items were based on a scale of Johnston and Kaye (2004) (a = .87). To measure perceived message valence the scale of John, Allen, and Kardes (1996) ( a = .84). was used. An example item is “I like the product information”. All four items were conducted by using a seven-point Likert scale.

3.5.1 Results pre-test

A total of 25 participants completed the questionnaire. Of the participants 64% was female. Of all participants 80% was under 40 years of age, (M = 31.72, SD = 10.63). First the reliability of the scales that were used, were measured through Cronbach’s Alpha. The reliability of all constructs was acceptable, as they exceeded the standard of 0,7 (Saunders, Lewis, and Thornhill, 2012). Finally, pre-attitudes of Activia and Optimel were measured and the framed advertisements were tested on brand familiarity, perceived credibility and perceived valence.

Pre attitude

The attitude scale has high reliability, the Cronbach’s Alpha of this scale is a = .939. None of the items would substantially affect reliability if they were deleted. To ensure that participants in general would not have an extreme negative or positive attitude towards the brands, pre-attitudes of Activia and Optimel were measured. Based upon a one-way ANOVA, participants evaluate Activia (M = 5.23, SD = .37) and Optimel (M = 4.91, SD = .79) neutral to fairly positive. Given the fact that the attitudes towards these brands are not extremely negative or extremely positive, the brands Activia and Optimel are appropriate to use in the experiment. Furthermore, there is not a significant difference in pre-attitudes of Activia and Optimel F (1, 23) = 0.98, p = .30 and therefore counterbalancing is successful.

Brand familiarity

The Cronbach’s Alpha of this scale is a = .749, which is a reliable scale. None of the items would substantially affect reliability if they were deleted. A one-way Repeated Measures ANOVA reveals that participants perceive the brand Pure Yog (M = 1.11, SD = .21) slightly more unfamiliar than Alunt (M = 1.29, SD = 0.44). The differences in brand familiarity are not significant F(1, 24) = 3,47, p = .075. As a result, Pure Yog is the most appropriate brand in the experiment because participants reported Pure Yog as most unfamiliar brand.

University of Amsterdam | Method 30 Furthermore, participants perceived the brand Pure Yog significantly less familiar (M = 1.11, SD = .21) than the brands Activia and Optimel (M = 6.69, SD = .54) , F(1, 24) = 1913,91, p < .001. The manipulation of brand familiarity was interpreted in the right way. Finally, it has been tested that there was not a significant difference in brand familiarity between Activia (M = 6.68, SD = .54) and Optimel (M = 6.70, SD = 0.57), F(1, 24) = 0,277, p = .603. For that reason, it can be concluded that counterbalancing is successful for the familiar brands Activia and Optimel.

Credibility

The credibility scale has high reliability, the Cronbach’s Alpha of this scale is a = .873. None of the items would substantially affect reliability if they were deleted. Results showed that all presented advertisements have been found credible (Mean > 4). A one-way ANOVA reveals that participants perceived the negative framed advertisements slightly more credible (M = 5.4, SD = .77) than the neutral framed advertisements (M = 4.74, SD = 1.30), but no significant differences were found in perceived credibility, F(1, 23) = 2,23 p = .15. As shown in the results, advertisements are perceived reasonably credible which indicates that the stimuli are realistic enough to use in the experiment.

Perceived valence

The valence scale has high reliability, with Cronbach’s Alpha a = .951. None of the items would substantially affect reliability if they were deleted. To test if the advertisements were interpreted in the right way in terms of message valence a one-way ANOVA was performed. The test reveals that participants perceived the negative framed advertisements significantly more negative (M = 3.58, SD = 1.51), than the neutral framed advertisements (M = 4.79, SD = 1.05), F(1, 23) = 5,43 p < 0.05. In addition, it can be said that the negative framed advertisement is perceived as mildly unfavourable information since the mean of the score of message valence is not extremely low. Based on the findings of the pre-test it is argued that the developed material was successful and that material and the brands can be used in the main study.

3.6 Manipulation check

In order to measure if the manipulation of disclosure of negative information was successful, in the last section of the survey the participants were asked to what extent they find that the advertisement emphasized positive or negative consequences of consumption of yoghurt (extreme negative consequences [1] to extreme positive consequences [7]).

University of Amsterdam | Method 31 Furthermore, in order to test if the manipulation in brand familiarity was successful, participants were asked how familiar they were with the brands measured on a seven-point semantic differential scale.

3.7 Measures

All items in the survey were obtained from English studies. As the survey was only handed out to a Dutch speaking audience, the original English items were translated into Dutch. In order to assure that the content of the items remain the same, the translated Dutch items were translated back into English again by an unrelated person. Some differences between this last translation and the original items were revised in the final Dutch version of the survey.

Brand attitude

As with the pre-test the attitude towards the brand was measured on a seven-point semantic differential scale developed by Stuart, Shimp and Engle (1987). Participants were asked to evaluate the brands, based on seven items ranging (good-bad, high quality-poor quality, like very much-dislike very much, superior-inferior, attractive-unattractive, pleasant-unpleasant, and interesting-boring).

Brand trust

To measure brand trust the scale of Chaudhuri and Holbrook (2001) (Cronbach’s a = .81) was used. The scale consists of four items based on a seven-point ratings of agreement (very strongly disagree [1] to very strongly agree [2]) with the following four statements: (1)“I trust this brand”, (2) “I rely on this brand”, (3) ‘This is an honest brand” and (4) “This brand is safe”.

Functional evaluation towards the product

To measure functional product evaluation items of two existing scales were used. All items of the scale ‘nutrition attitude’ of Kozup, Creyer and Burton (2003) (Cronbach’s a= .84) were used and two of the three items of the existing scale of Provencher, Polivy and Herman (2009 ). One item was excluded because that statement concerns an attitude about dieting and weight control. Participants were also asked to report their opinions (on 7-point scales) about the advertised product. The following five statements were used: (1) “I think the nutrition level of this product is”(from poor [1] to good[7]), (2) “Based on the information provided, how important would this product be as part of a healthy diet?” (not important at all [1] to very important [7]), (3) “This product is” (bad for your heart [1] to good for your heart[7]), (4) “How healthy is this snack for