Quality Certificates Alleviate Consumer Aversion to Sponsored Search Advertising

Abstract

Building on growing evidence that consumers respond poorly to sponsored search advertising, this paper studies whether incorporating trust signals into ads can alleviate these negative reactions. We leverage a system glitch on a major e-commerce platform that removed the display of a badge representing a quality certificate from all eligible listings, to show that certification leads to a greater increase in sales for sponsored listings than for organic listings. We then corroborate these results using a second field experiment that randomizes the salience of ad display on the same platform. We find that more salient ad disclosure causes a more significant sales reduction in sponsored listings without a quality certificate compared to those with a quality certificate. The results of the experiments offer robust evidence that trust signals can enhance consumer sentiment toward sponsored search advertising.

Keywords: sponsored search advertising, quality certificates, e-commerce