When Advertising Speaks Honestly: The Role of AI Usage Declaration in Shaping Consumer Perception and Behavior

This study examines how disclosing the use of Generative AI in social media advertising influences consumer perceptions and engagement. Based on the Persuasion Knowledge Model, two experiments tested the effects of AI disclosure on ad credibility, language comprehension, and users’ willingness to like or share the ad. Study 1 (N=230) found that declaring AI use improves perceived credibility and comprehension. Study 2 (N=324) confirmed these effects across product categories and showed that AI disclosure boosts engagement intentions. Mediation analyses revealed that perceived credibility fully explains the link between AI disclosure and consumer engagement. These findings highlight transparency as a key factor in enhancing consumer trust and behavioral responses in digital advertising. The results align with regulatory initiatives advocating for AI disclosure, showing that transparency not only supports ethical communication but also drives strategic benefits.