Go with the flow!

Sammanfattning: With the growth of e-commerce, companies are using different online advertising efforts in order to attract consumers and entice them to buy their products. However, despite huge investments made in online advertisement, little is known about its impact on consumers' perceptions. Online grocery stores are a rather new phenomenon and within the digital grocery context, a new form of advertising has been identified where the advertisement is placed in the feed next to a specific product. Many previous studies have focused on effects of online advertising on the advertised brand, but few researchers have investigated how the retailer exposing the ad is affected by the advertisement. The purpose of this study is to explore, within the online grocery store context, the effects of advertisements placed in the product feed on consumers' perceptions of both the advertised brand and the retailer. The study was conducted through a quantitative method to examine how consumers perception of the advertised brand and retailer differed when the advertisement was present in the product feed, versus when the advertisement was absent. The results of the study showed that the advertisement had a positive effect on consumers' attitude, perceived inspiration, perceived quality and perceived price on the advertised brand, and that perceived quality and perceived inspiration increased the probability of consumer purchasing the advertised product. In addition, a positive effect on consumers' attitude, perceived inspiration, perceived price and web atmosphere could be derived to the retailer, which further is linked to customer satisfaction. Thus, using advertisements in the feed of an online grocery store will have a significant effect on both how the brand and retailer is perceived by the consumer on multiple fronts.