Customer Engagement and Advertising Effectiveness A Moderated Mediating Analysis

Journal of Internet Commerce
ISSN: (Print) (Online) Journal homepage: https://www.tandfonline.com/loi/wico20
Customer Engagement and Advertising

Effectiveness: A Moderated Mediating Analysis
Anubha & Samik Shome
To cite this article: Anubha & Samik Shome (2021) Customer Engagement and Advertising
Effectiveness: A Moderated Mediating Analysis, Journal of Internet Commerce, 20:4, 409-449, DOI:
10.1080/15332861.2021.1955324
To link to this article: https://doi.org/10.1080/15332861.2021.1955324
Published online: 09 Aug 2021.
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JOURNAL OF INTERNET COMMERCE
2021, VOL. 20, NO. 4, 409–449
https://doi.org/10.1080/15332861.2021.1955324
Customer Engagement and Advertising Effectiveness: A

Moderated Mediating Analysis
Anubhaa and Samik Shomeb
a
Jaipuria Institute of Management, Ghaziabad, India; bInstitute of Management, Nirma University,
Ahmedabad, India
ABSTRACT KEYWORDS
Marketing communications are witnessing a historic change in Customer engagement;
current times with online digital video advertising becoming a generation Y; YouTube
trend. Marketers are spending a significant pie of advertising advertising; PROCESS
macro; moder-
budget on such video advertising on YouTube as it is a preva- ated mediation
lent digital video channel among Generation Y. Purchasing
decisions of this generation are influenced by YouTube adver-
tising. Thus, understanding the perceived value of YouTube
advertising becomes imperative for global marketers, espe-
cially in India which consists of 440 million millennials to tar-
get them. In this backdrop, the current study supplements to
the extant literature by adding new linkages in the field of
advertising by investigating attitude toward advertising as a
mediator, mediating the relationship of perceived advertising
value with purchase intentions. The study applies moderated
mediation to examine the role of customer engagement. The
mediation and moderated mediation were tested using
PROCESS macro v3.5 by Andrew F. Hayes after collecting
responses from 374 millennials. Implications for marketers are
discussed in the end.
Introduction
Effective marketing communication is the backbone of any business in a
hypercompetitive society and is essential for enhancing customer engage-
ment (Li and Lo 2015; Rodriguez 2017; Coursaris, Van Osch, and Balogh
2016). It has been intensified by the exponential growth of online digital
video channels (Foye 2018). These channels are preferred over traditional
mediums like television and radio by Generation Y as their behavioral deci-
sions are greatly influenced by them (Hayes 2019). Corporates, in their
pursuit to reach such customers, are harnessing the power of such digital
video channels, and therefore, are directing a significant portion of their
advertising budget to these channels (Foye 2018). YouTube is one such
highly popular online digital video channel among this generation (Lee and
CONTACT Samik Shome samik@nirmauni.ac.in Institute of Management, Nirma University, Ahmedabad,

Gujarat, India.
ß 2021 Taylor & Francis Group, LLC
410 ANUBHA AND S. SHOME
Hong 2016; Chadha 2018). The total advertising budget on online digital
video channels is estimated to reach $37 billion by the year 2022 from $16
billion in 2017 out of which 25% is expected to be spent on YouTube
advertising alone (Foye 2018).
Generation Y spends a significant portion of time on such online digital
videos especially on YouTube through their smartphones (Smith 2020).
During this process, they come across a number of advertisements which
may have a substantial impact on their purchasing decisions. Therefore,
YouTube advertising should be highly effective to reach this cohort as tar-
geting it via traditional mode is highly challenging (Hayes 2019).
Furthermore, a substantial increase in advertisement recall, brand aware-
ness and purchase intention has been reported on account of YouTube
advertising (Iqbal 2020). With more than 2.3 billion logs per month,
YouTube is a medium with which businesses can reach Generation Y and
can drive them to the upper levels of the marketing funnel, i.e., desire and
action (Mohsin 2021; Statista 2021a). The enormous consumption and tre-
mendous popularity of YouTube provide marketers a gigantic opportunity
to communicate their brand contents to viewers and engage them (Kujur
and Singh 2018).
Due to cost-effectiveness and greater reachability, marketers are increas-
ingly preferring YouTube to advertise their brands. By this, they try to
motivate Generation Y customers to develop positive purchase intentions
toward their advertised brands. Several researchers have explored the fac-
tors which increase the effectiveness of YouTube advertising and impact
the purchase intentions of its viewers (Firat 2019; Nabila and Achyar 2020;
Duffett 2020; Aslam, Farhat, and Arif 2020). Majority of the studies investi-
gated YouTube advertising effectiveness by examining the impact of differ-
ent factors like, brand awareness (Uparimart 2018; Aziza and Astuti 2019;
Dehghani et al. 2016); brand liking (Duffett et al. 2019; Duffett 2020);
brand preference (Duffett et al. 2019; Duffett 2020); informativeness
(Uparimart 2018; Aziza and Astuti 2019; Nabila and Achyar 2020;
Dehghani et al. 2016; Firat 2019); attitude (Yang et al. 2017; Nabila and
Achyar 2020); trendiness (Firat 2019); multimedia tools (Gupta, Singh, and
Sinha 2017); advertising value (Dehghani et al. 2016; Aziza and Astuti
2019; Nabila and Achyar 2020; Firat 2019); credibility (Nabila and Achyar
2020); entertainment (Uparimart 2018; Aziza and Astuti 2019; Dehghani et
al. 2016); irritation (Dehghani et al. 2016; Uparimart 2018; Aziza and
Astuti 2019; Nabila and Achyar 2020; Firat 2019); and, customization
(Uparimart 2018; Aziza and Astuti 2019; Nabila and Achyar 2020), among
others on behavioral decisions. It should be noted that customers’ purchase
intentions are steered by the advertising value they experience on YouTube
(Aziza and Astuti 2019). Hence, the perceived value of an advertisement
JOURNAL OF INTERNET COMMERCE 411
may play a crucial role in shaping the attitude which in turn impacts the
purchase intentions of customers (Nabila and Achyar 2020).
A lack of understanding of how the perceived value of an advertisement
drives customers’ attitudes and subsequent purchase intentions in the con-
text of YouTube is problematic for marketers. They are keen to know how
the perceived value of their YouTube advertisement can be enhanced to
increase its effectiveness. Several literatures, in the past, have studied the
effectiveness of online advertising based on its value in different contexts
like web (Ducoffe 1995; Kim J. U., Kim W. J., and Park 2010); internet (An
and Kim 2008); email (Haq 2009); social media (Chandra, Goswami, and
Chouhan 2012; Arora and Agarwal 2020; Sari, Suziana, and Games 2020;
Ying et al. 2020); Facebook (Duffett 2015; Hamouda 2018); mobile phones
(Haq and Ghouri 2017; Hongyan and Zhankui 2017; Kim 2020); short mes-
sage service (SMS) (Chowdhury et al. 2016; Eshra and Beshir 2019); and,
Instagram (Gaber, Wright, and Kooli 2019), among others based on differ-
ent dimensions. However, limited studies were found which examined the
effectiveness of advertising in YouTube based on its value (Dehghani et al.
2016; Yang et al. 2017; Uparimart 2018; Aziza and Astuti 2019; Firat 2019;
Nabila and Achyar 2020). Therefore, in this age of technology driven mar-
keting communications, there is a need to further research and explore the
topic to get more insights. Hence, this study contributes to the existing
advertising literature by examining how perceived value in a YouTube
advertisement can increase its effectiveness by impacting the attitude and
purchase intentions of Generation Y.
Past literature has shown that viewers when coming across a YouTube
advertisement, tend to just skip or disregard it due to their engrained
behavior (Taylor 2017; Handayani and Hudrasyah 2015). The study done
by Magnaglobal (2016) revealed that people tend to skip an advertisement
when they find it irrelevant for them or it is too long. People also skip it
when they do not like the brand or do not enjoy its theme. The irritation
experienced by YouTube advertising is an important parameter which
reduces its perceived value (Aziza and Astuti 2019). Viewers consider such
advertisements as an interference in their privacy (Edelman 2020). The ten-
dency of people to skip YouTube advertisement as soon as they watch it is
a matter of primary concern for marketers as its hampers its evaluation
(Jung 2017). Hence, it becomes imperative for marketers to understand
how to increase the effectiveness of YouTube advertising to motivate view-
ers to watch it. Only then the evaluation of an advertisement is possible
which may have an influence on their attitude and purchase intentions.
This can be achieved by increasing the overall perceived advertising value
for the viewers. Additionally, the literature review revealed that several
studies focused on Generation Y in studying the effectiveness of online
advertising in contexts like, social media (Arora and Agarwal 2019, 2020;
Sari, Suziana, and Games 2020) and mobile phones (Kim 2020). However,
only a few studies have investigated the effectiveness of YouTube advertis-
ing from the perspective of Generation Y (Dehghani et al. 2016; Aziza and
Astuti 2019). Hence this indicates a gap which this study intends
to address.
The literature suggests that perceived advertising value is a unidimen-
sional construct (Dehghani et al. 2016; Yang et al. 2017; Uparimart 2018;
Aslam, Farhat, and Arif 2020) and marketers need to know which dimen-
sion of value they should focus on for enhancing the effectiveness of adver-
tising. The notion of advertising in online digital videos was added to the
marketing literature in recent years (Lee and Hong 2016; Chadha 2018;
Foye 2018). Though several studies have investigated the effect of perceived
advertising value on customers’ behavioral responses to judge its effective-
ness, these studies considered perceived advertising value as a first-order
construct. They demonstrated the effects of various dimensions exclusively
on perceived advertising value which in turn impacts attitudes and pur-
chase intentions (Firat 2019; Nabila and Achyar 2020; Eshra and Beshir
2019; Arora and Agarwal 2020; Kim 2020; Sari, Suziana, and Games 2020;
Ying et al. 2020). As such, perceived advertising value is a context-specific
phenomenon and can vary from one context to another (Voorveld et al.
2018), much of the existing advertising literature has been related to vari-
ous contexts like web, internet, email, SMS, mobile, Facebook and
Instagram have been unidimensional (Kim J. U., Kim W. J., and Park 2010;
An and Kim 2008; Haq 2009; Hamouda 2018; Kim 2020; Eshra and Beshir
2019 and Gaber, Wright, and Kooli 2019). Furthermore, studies done in
the context of YouTube are also unidimensional (Dehghani et al. 2016;
Yang et al. 2017; Uparimart 2018; Aziza and Astuti 2019; Firat 2019;
Nabila and Achyar 2020). However, the impact of perceived advertising
value as a multidimensional construct on attitude and purchase intention
has not been investigated yet in the context of online advertising effective-
ness especially in the YouTube context. Due to the popularity of YouTube
among Generation Y (Mohsin 2021), it is warranted to examine the impact
of perceived advertising value as a multidimensional construct on advertis-
ing effectiveness in the context of YouTube. However, the literature has
not yet demonstrated how overall perceived advertising value influences the
attitude and purchase intentions of Generation Y. In other words, no study
examined the impact of perceived advertising value as a second order con-
struct on the attitude and purchase intentions of Generation Y in the con-
text of YouTube. This indicates a gap in the literature which encouraged
this study. This study addresses this gap by contributing to the YouTube
literature by examining advertising value as a second order construct and
shows the impact of overall perceived value rather than of individual

dimension. The current study is of the view that informativeness, entertain-
ment, credibility and personal relevancy of an advertisement in totality
determines its value for the YouTube viewers. In other words, when
Generation Y viewers find that an advertisement is entertaining and pleas-
ing (i.e., entertainment); trustworthy and believable (i.e., credibility);
important, meaningful and valuable for them (i.e., personal relevancy) and
provide them timely and relevant information (i.e., informativeness), their
perceived advertising value may be more. This overall enhanced value may
have a favorable impact on their attitude toward advertising and this may
impact their purchase intentions.
It should also be noted that extant literature has tried to examine the
effect of perceived advertising value in the context of YouTube on the atti-
tudes and purchase intentions (Firat 2019; Nabila and Achyar 2020) but
the focus was on studying the simple and direct effects of perceived adver-
tising value on purchase intention which may not portray the accurate rela-
tionship of the variables. Though Uparimart (2018) and Aziza and Astuti
(2019) have tested indirect effect also but via brand awareness, then no
study has tested attitude as a mediator between perceived advertising value
and purchase intention. This is a gap in the literature and prompted this
study. Hence, this study aims to examine the indirect effect of perceived
advertising value on purchase intention via attitude toward YouTube adver-
tising. As the study assumes that behavioral intentions can be better
explained through attitude (Anubha and Shome 2020), this indicates that
favorable attitude toward YouTube advertising based on its perceived value
may result in more positive purchase intentions toward advertised brands.
Consequently, understanding such attitudes is essential as they are the
main catalysts of advertising exposure. This in turn influences customers’
behavioral responses toward such advertising (Chandra, Goswami, and
Chouhan 2012). Hence, this study contributes to the advertising literature
by examining the attitude toward advertising as a mediator, mediating the
relationship between perceived advertising value and purchase intentions.
Kim et al. (2010) has argued that the relationship between perceived
advertising value and purchase intentions is much beyond the simple direct
relationships Overall, it is an entire mechanism rather than direct associ-
ation only (Kim J. U., Kim W. J., and Park 2010). Likewise, researchers
have attempted to test the mediating and moderating effects of different
variables on the relationship of perceived advertising value with purchase
intentions (Hongyan and Zhankui 2017). Furthermore, these mediating and
moderating effects can be operationalized simultaneously, and hence, these
may affect the association of perceived advertising value with purchase
intentions. Extant literature on online advertising effectiveness has
examined such mediating and moderating effects separately (Hongyan and

Zhankui 2017; Aziza and Astuti 2019). The existing studies do not reveal
how moderator and mediator can modify the relationship of perceived
advertising value with purchase intentions simultaneously. Hence, the cur-
rent study also addresses this gap. Therefore, this study integrates both the
mediating and moderating variables in a single model (moderated medi-
ation) and comprehensively examines the effect of these variables in the
association of perceived advertising value and purchase intentions toward
advertised brand.
To test the moderation mediation, the paper tests Customer Engagement
as a moderator, moderating the mediating relationship between advertising
value and purchase intentions. The selection of customer engagement as a
moderator is based on certain logical assumptions. First, several researchers
have proved that customer engagement drives purchase intentions and
behavior in an online context (Islam, Rahman, and Hollebeek 2018;
Heerde, Dinner, and Neslin 2019; McLean and Wilson 2019; Hollebeek and
Macky 2019), hence, customer engagement may be a critical indicator of
online advertising effectiveness (Wu 2016). Secondly, several recent studies
have explored customer engagement in different contexts like online brand
communities (Islam et al. 2018); travel websites (Anubha, Jain, and Hooda
2019); technological environment (Hollebeek et al. 2019a); mobile app
(Hollebeek, Islam, and Macky 2019b); online services (Khan et al. 2019);
service quality (Islam et al. 2019a); service failure recovery (Islam, Rahman,
and Hollebeek 2019b), esports videogames (Abbasi et al. 2020); online
banking (Islam et al. 2020); digital age (Rasool, Shah, and Islam 2020) and
tourism destinations (Rather 2020), among others. This clearly indicates the
seriousness with which practitioners and academicians alike are attempting
to understand how customer engagement leads to various behavioral deci-
sions (Hollebeek and Macky 2019; Hollebeek et al. 2019a; Kaur et al. 2020;
Rather, Tehseen, and Parrey 2018). However, the research is sparse in the
context of customer engagement with YouTube advertising (Wu 2016;
Kujur and Singh 2018). Thirdly, it has been shown by Habibi, Laroche, and
Richard (2014) that a high customer engagement in social media advertis-
ing produces positive impacts. Lastly, purchase intentions are also steered
by customer engagement (Hollebeek and Macky 2019) that is a clear indi-
cation that if customers are highly engaged toward an advertising, this may
have a positive influence on their attitude which will have a direct influence
on their purchase intention. At this point, it is important to note that exist-
ing literature has not tested customer engagement as a moderator.
Therefore, the present study aims to address this gap by measuring the rip-
ple effect of customer engagement with YouTube advertising and compares
the impacts of high and low customer engagement. In other words, the
Figure 1. The proposed model.
current study proposes a comprehensive moderated mediation model

(Figure 1) to empirically investigate the influence of perceived advertising
value in YouTube advertising on purchase intentions of Generation Y using
Brackett and Carr’s Model (2001) which has been explained in theoretical
background section. Hence the current study proposes the following
research questions:
1. Does perceive advertising value by impacting the purchase intentions for

the advertised brands on YouTube contribute to increasing the effectiveness
of such advertising?
2. Does the impact of the perceived value of YouTube advertising on pur-
chase intention can be mediated by attitude toward advertising?
3. Do different levels of customer engagement have diverse effects on these
mediation dynamics?
To answer these questions, this study investigates the role of overall per-
ceived advertising value in impacting purchase intentions to assess the
effectiveness of online advertising in the context of YouTube. The present
study recommends that attitude toward advertising as a mediator in the
relationship of perceived advertising value with purchase intentions and
proposed that this mediation varies as per the different levels of cus-
tomer engagement.
Thus, this study has theoretical and practical significance. In terms of its
theoretical importance, first, the present study reveals that the mechanism
of moderating and mediating variables can be operationalized simultan-
eously in explaining the relationship of perceived advertising value with
purchase intentions. It demonstrates a complex moderated mediation
mechanism to investigate the impact of perceived advertising value in the
context of YouTube advertising on purchase intentions for advertised
brands. Second, the perceived advertising value has been tested as a

second-order construct in this study, hence, contributing toward advertis-
ing value literature. Lastly, this study is aimed at Generation Y customers,
therefore, provides more insight into the Generation Y literature.
Practically, this study recommends marketers ways to enhance perceived
advertising value in the context of YouTube. Specifically, the findings of
this study indicate the role of Generation Y customer engagement in affect-
ing the relationship between perceived advertising value and their attitude
toward YouTube advertising which finally impacts their purchase intentions
for the advertised brands. The study, therefore, suggests that to increase the
effectiveness of online advertising in the context of YouTube, which is
reflected in terms of favorable purchase intentions, marketers should con-
sider both advertising value and Generation Y’s engagement as the most
important strategic components.
The organization of the paper is as follows. Section “theoretical back-
ground” presents the theoretical background of the study followed by a lit-
erature review in Section “literature review.” The rationale for choosing
millennials as a sampling frame for the study is provided in the method-
ology in Section “methodology.” In Section “data analysis and findings,”
the study presents findings based on data analysis accompanied by its
detailed discussion in Section “discussion.” The implications of the study
are deliberated in Section “theoretical and managerial implications.” Section
“limitations and direction for future research” deals with the limitations of
the study and discusses the future research opportunities followed by con-
cluding remarks in Section “conclusion.”
Theoretical background
The current study adopts Brackett and Carr’s Model (BCM) as the underly-
ing theoretical mechanism to build the conceptual relationships among
various constructs of this study. The BCM affirms that the various dimen-
sions of advertising, viz. informativeness, entertainment, irritation and
credibility impact the perceived value of an advertisement which has a sig-
nificant influence on their attitudes (Brackett and Carr 2001; Gaber et al.
2019). In other words, this model explains how attitudes toward advertising
are formed through various antecedents of the perceived value of web
advertising. Underpinnings of BCM have been chosen to provide a theoret-
ical foundation to this study as literature has proved that BCM is a more
advanced advertising value model as compared to earlier models developed
by advertising researchers including Ducoffe (1996). Moreover, BCM has
got more explanatory power in examining the effectiveness of online
advertising than previous models (Brackett and Carr 2001; Arora and
Agarwal 2019).
Consistent with the BCM model, the “perceived advertising value” is
influenced by various characteristics viz. Informativeness, entertainment,
credibility and personal relevancy of an advertisement and in turn influen-
ces the attitude of customers toward online advertising (Nabila and Achyar
2020; Aktan et al. 2016; Kim 2020; Arora and Agarwal 2020). The BCM
model has studied perceived advertising value as a unidimensional con-
struct that is influenced by four constructs namely Informativeness, enter-
tainment, irritation and credibility. However, in the context of the present
study, perceived value has been examined as a multidimensional construct
that comprises informativeness, entertainment and credibility and personal
relevance as first-order constructs .
In tune with BCM, “attitude towards advertising” is the outcome of
advertising value which a viewer perceives based on its informativeness,
entertainment, irritation and credibility (Gaber, Wright, and Kooli 2019).
The general premise that perceived value influences the attitude is not
exhaustive as it does not provide complete insight into what drives the
effectiveness of an online advertisement as BCM is silent on the impact of
the perceived value of an advertisement on the purchase intentions of view-
ers toward advertised brands. However, an advertisement is considered to
be effective only when it drives purchase intentions (Firat 2019; Aslam
2020). Hence, the current study extends the BCM by adding purchase
intentions as an outcome of attitudes toward advertising as purchase inten-
tions are driven by attitudes (Fishbein and Ajzen 1975). It increases its
explanatory power in explaining the effectiveness of online advertising.
Furthermore, the ability of online advertising to engage its customers is
an important parameter to judge its effectiveness. Based on it, this study
adds one more construct, namely customer engagement to the proposed
model to get better insights as highly engaged customers to show more
favorable behavioral responses in terms of attitude and purchase intentions
in online context (Islam, Rahman, and Hollebeek 2018; Heerde, Dinner,
and Neslin 2019; McLean and Wilson 2019; Hollebeek and Macky 2019).
Based on the aforementioned conceptual underpinnings and by specifically
drawing on the theoretical establishments of BCM, the next section intro-
duces the conceptual model and related hypotheses.
Literature review
YouTube advertising
YouTube advertising can be defined as a pay-for-placement system that
allows brands to reach 2.3 billion users per month through targeted
advertisements. These advertisements, which include videos, banners and

text, among others, can be shown before the requested video plays or as an
overlay while a video plays or in the right margin of the webpage (Mohsin
2021). At present, YouTube feeds more than 1 billion hours of video per
day to its users (Newberry 2021). Literature has shown that there is a sub-
stantial increase in advertisement recall, brand awareness and purchase
intention on account of YTadv (Iqbal 2020). This is a medium which may
drive viewers to the upper levels of the marketing funnel viz. desire and
action toward advertised brands (YouTube Effectiveness Guide 2019).
YouTube, today, provides multiple advertising formats such as skippable
advertisements, non-skippable advertisements, sponsored advertisements,
display advertisements, bumper advertisements and overlay advertisements.
(YouTube Help 2020b).
YouTube advertising started in 2006 when it offered various advertising
possibilities to companies claiming that it can be used as an effective mar-
keting tool by the marketers (Schwemmer and Ziewiecki 2018). Google
tried to develop YouTube into a revenue-generating product by the
medium of advertisements just after its acquisition in October 2006.
(Gerhards 2019). Hence, the main goal was to attract a greater number of
advertisers. YouTube presented various opportunities for marketers to
monetize their videos (Gerhards 2019; Kim 2012). To achieve this, more
professionally produced content was created rather than user-generated
content on YouTube with the launch of the YouTube advertising revenue-
sharing partner program (Gerhards 2019). Traditional media companies
started using YouTube as a platform to promote their content (Kim 2012).
By and by, advertisers and marketers started realizing the potential of
YouTube advertising for monetization (Schwemmer and Ziewiecki 2018).
Companies in their pursuit increased their budgets on YouTube advertising
(Foye 2018). All this has led to an increased demand of YouTube from
advertisers (Gerhards 2019).
YouTube has become the second-largest search engine after Google, the
owner of YouTube in the world. It is the second most visited website in
the world. It is the largest of the video creating and sharing sites across the
globe (Aslam 2021). YouTube has 2.3 billion monthly users with more
than 77% are millennials aged between 23 and 38 years (Statista 2021a;
Aslam 2021). More than 500 h of video are uploaded every minute (Statista
2021b). Daily one billion hours of video content are viewed (Smith 2020).
Generation Y spends a huge amount of time on YouTube videos through
mobile devices (Smith 2020). As per the YouTube user statistics, 54% of
millennials check YouTube daily whereas 29% of millennials watch
YouTube advertisements until completion without skipping (Hayes 2019;
McCarthy 2017). Recently, YouTube has become Google’s one of the most
profitable businesses, earning $19.8 billion in 2020. Based on these statis-

tics, it can be inferred that YouTube has tremendous potential for the pur-
pose of advertising and hence this study tries to understand the
effectiveness of YouTube advertising to achieve a high level of customer
engagement which drives the attitudes and purchase intentions of
Generation Y.
Conceptual model and hypotheses development

Perceived advertising value leading to purchase intentions
Perceived advertising value can be defined as the utility or worth of an
online advertisement for a customer (Ducoffe 1996, Ying et al. 2020). In
other words, it is the subjective evaluation of the overall worth of an online
advertisement for a viewer. It is directly linked with the acceptance of an
advertising message by the target group of customers based on its useful-
ness (Lu, Wu, and Hsiao 2019). Subsequently, it enhances the purchasing
probability of an advertised product. Several literatures have revealed that
increased purchase intentions based on the advertising value are the indica-
tors of its effectiveness (Firat 2019; Aziza and Astuti 2019). Marketers tend
to exchange value with Generation Y customers via YouTube advertising as
their main motive is either to sell their products or to motivate them to
purchase (Dehghani et al. 2016). Hence, to increase the effectiveness of
their YouTube advertising, marketers need to enhance its value for their
target customers. The perceived value of an advertisement has many drivers
namely, entertainment, informativeness, credibility and personal relevancy
(Brackett and Carr 2001; Gaber, Wright, and Kooli 2019). The different
customers perceive a YouTube advertisement differently depending on the
value they receive. This perception shapes their purchase intentions for the
advertised brands which indicate the effectiveness of a YouTube advertise-
ment (Firat 2019; Aziza and Astuti 2019).
The first driver of perceived advertising value in the context of YouTube
advertising is entertainment (Dehghani et al. 2016; Yang et al. 2017;
Uparimart 2018; Aziza and Astuti 2019; Nabila and Achyar 2020; Firat
2019). Entertainment, in an online advertisement, indicates that the con-
tents of an advertisement are pleasing, entertaining and enjoyable which
motivates them to watch it fully (Ducoffe 1996; Gaber Wright, and Kooli
2019). The advertising literature has shown that the entertaining attribute
of an online advertisement in various contexts helps the customers in eval-
uating the advertised product and thus, significantly contributes to enhanc-
ing its value (Hamouda 2018; Arora and Agarwal 2019; Ying et al. 2020;
Kim 2020; Sari, Suziana, and Games 2020).
The second driver of perceived value in a YouTube advertisement is

informativeness (Dehghani et al. 2016; Yang et al. 2017; Uparimart 2018;
Aziza and Astuti 2019; Nabila and Achyar 2020; Firat 2019). Falc~ao and
Isaıas (2020) revealed that in search engines like YouTube the value of
advertising is measured by its informativeness. In the context of online
advertising, informativeness refers to the ability of an advertisement to
inform its target customer about the advertised product in order to provide
them complete and timely information (Ducoffe 1996). The advertising lit-
erature has shown that informativeness of online advertisement in various
contexts helps the customers in evaluating the advertised product and thus,
significantly contributes in enhancing its value (Brackett and Carr 2001;
Hamouda 2018; Arora and Agarwal 2019; Ying et al. 2020; Kim 2020; Sari,
Suziana, and Games 2020).
YouTube advertising literature cites that the credibility of advertising as
the next/third salient driver of its perceived value (Dehghani et al. 2016;
Yang et al. 2017; Aziza and Astuti 2019; Nabila and Achyar 2020).
Credibility can be defined as the truthfulness and believability of the claims
made about the advertised product (MacKenzie and Lutz 1989; Gaber,
Wright, and Kooli 2019). In other words, it is the trustworthiness of adver-
tising as perceived by the viewers. The online advertising literature has
shown that the credibility of an online advertisement in various contexts
significantly enhances its perceived advertising value (Hamouda 2018;
Arora and Agarwal 2019; Ying et al. 2020; Sari, Suziana, and Games 2020).
The fourth driver of perceived advertising value is personal relevance.
Personal relevance refers to the degree to which the contents of advertising
are relevant to the current needs, activities, and interests of the viewers
(Wells, Leavitt, and McConville 1971; Arora and Agarwal 2019). The per-
ceived value of YouTube advertising is higher for consumers when they
perceive it as relevant for them (Dehghani et al. 2016; Uparimart 2018).
Consumers attend personally relevant advertising well which results in their
cognitive processing which enhances the perceived value of advertising and
makes it more effective (Gaber, Wright, and Kooli 2019). Several adver-
tisers have now started sharing personally relevant advertisements in the
context of social media to save the customers from the clutter created by
numerous advertisements (Jung 2017; Arora and Agarwal 2019).
The literature has also revealed that advertising value perceived by cus-
tomers in a YouTube advertisement significantly influences their purchase
intentions (Aziza and Astuti 2019; Firat 2019). It is to be noted that litera-
ture has investigated the effectiveness of online advertising taking perceived
advertising value as a first-order construct. Studying the impact of per-
ceived advertising value as a second-order or multidimensional construct
having four drivers (namely, entertainment, informativeness, credibility and
personal relevance) on purchase intention in the context of online advertis-

ing is missing. In this backdrop, the current study proposes the follow-
ing hypothesis:
H1: Positive perceived ad value (PVadv) driven in the context of YouTube Advertising
(YTadv) evokes viewers to have positive purchase intention towards the
advertised products
Perceived advertising value leading to attitude

Attitude is an experienced penchant to acknowledge a stimulus either posi-
tively or negatively (Jalilvand et al. 2012; Casal o, Flavian, and Guinalıu
2011; Fishbein and Ajzen 1975). It expresses the feelings of people and
reveals whether they are favorably or unfavorably predisposed to some
‘stimulus’ or ‘object’. The conceptual framework, BCM, proposed by
Brackett and Carr (2001) explained that the perceived advertisement value
in cyberspace had a significant impact on customers’ attitudes toward
advertising. It has been found that the value derived from web advertising
leads to the development of attitude (Ducoffe 1996). Arora and Agarwal
(2019) and Ying et al. (2020) confirmed that customers reflect favorable
attitudes toward social media advertisements if they perceive higher value
from them. Past literature on advertising effectiveness in the context of
mobile has declared that the higher value of a mobile advertisement
resulted in more positive attitude toward it (Kim 2020). Similar results
were observed by Hamouda (2018) and Shareef et al. (2019) in the context
of Facebook advertising. Furthermore, the research has shown that per-
ceived advertising value is an important antecedent of attitude in the con-
text of Instagram advertising (Gaber, Wright, and Kooli 2019). The current
study concurs with the existing literature. If customers perceive high value
from YouTube advertising, they will have favorable attitude toward it
(Nabila and Achyar 2020). In the light of the above information, the fol-
lowing hypothesis is posited:
H2: Positive perceived advertising value leads to having a positive attitude
towards YTadv.
Attitude leading to purchase intentions

An initial response of a customer’s exposure to an advertising stimulus is
referred to as Attitude toward advertising (Wang and Sun 2010; Mackenzie
and Lutz 1989). In literature, the attitude has been proposed as an immedi-
ate antecedent of purchase intentions (Fishbein and Ajzen 1975). Several
studies have, thus, proposed that customers’ purchase intentions are signifi-
cantly influenced by their attitude toward online advertising in various
contexts (Hamouda 2018; Arora and Agarwal 2020; Ying et al. 2020).
Aslam et al. (2020), revealed that attitude toward advertising has a signifi-
cant contributing impact on shopping intentions for brands in both types
of YouTube advertisements namely full-length and skippable advertising.
The current research harmonizes with these studies. If consumers have
favorable attitude toward YouTube advertising, they will develop favorable
purchase intentions toward advertised products (Yang et al. 2017; Nabila
and Achyar 2020). In the light of the above information, the following
hypothesis is posited.
H3: Attitude towards YTadv will result in positive purchase intentions.
Attitude as a mediator toward purchase intentions

The advertising literature recommended that favorable attitude toward an
advertisement in cyberspace is an initial indicator of its effectiveness. It
indicates that viewers’ perceived value from such advertisements is high
(Brackett and Carr 2001; Gaber, Wright, and Kooli 2019). As purchase
intentions are followed by attitude, developing a positive attitude is very
important to increase the effectiveness of an online advertisement (Arora
and Agarwal 2020; Ying et al. 2020). But an empirical investigation of atti-
tude toward advertising as a mediator is missing in the advertising litera-
ture. Additionally, customers will develop favorable attitude toward online
advertising only when they perceive value in it as they find it more enter-
taining, informative, credible and personally relevant for them (Nabila and
Achyar 2020; Arora and Agarwal 2019; Kim 2020). Furthermore, Pan et al.
(2020), in their study, have proposed that attitudes toward advertising on
social networks like YouTube have a significant direct effect on purchase
intentions. Also, the literature has demonstrated that perceived advertising
value has a direct casual effect on purchase intentions in the context of
YouTube (Aziza and Astuti 2019; Firat 2019). The current study assumes
that behavioral intentions can be better explained through attitude
(Anubha and Shome 2020). Based on it, this study examines the mediating
impact of attitude toward YouTube advertising in the relationship between
perceived advertising value and purchase intentions. Hence, the study pos-
its the following hypothesis:
H4: The relationship between positive perceived ad value and purchase intentions is
mediated by a positive attitude towards the YTadv.
Moderated mediation effect of customer engagement

Consumer engagement refers to the willingness of consumers to actively
participate and interact with a focal object like online advertising which
may vary in direction and magnitude and shows a significant influence on

consumers brand attitudes and purchase intentions (Islam, Rahman, and
Hollebeek 2017). Customer engagement is a psychological construct which
is beyond involvement (Dolan et al. 2019). It is an important construct for
marketers as it helps them in understanding customers’ relationships with
the brands in the context of social media (Hollebeek, Glynn, and Brodie
2014). Literature has observed that customer engagement toward an adver-
tisement is a measure of its effectiveness (Rodriguez 2017; Cher and
Arumugam 2019). Various metrics exist to access the engagement level of
the customers toward YouTube advertising namely views and view rate.
Views represent the number of times people watched (were engaged) an
advertisement. Similarly, the view rate gives the number of views or
engagements a YouTube advertisement receives divided by the number of
times that advertisement is shown (YouTube Help 2020a). In other words,
the engagement toward an advertisement can be accessed on the basis of
whether people skip it or watch it. It is important to note that these metrics
are silent on what makes customers watch a YouTube advertisement.
Literature has revealed that viewers when coming across a YouTube adver-
tising, tend to either skip or disregard it out of their habit (Taylor 2017;
Handayani and Hudrasyah 2015). Whereas, the study done by Magnaglobal
(2016) revealed that people avoid skipping a YouTube advertising if it
deems fit with their interests. This tendency to avoid skipping YouTube
advertising indicates a higher level of customer engagement. Furthermore,
some customers watch an advertisement till the end when they are inter-
ested in the product advertised or if they are familiar with the brand indi-
cating higher customer engagement (Rodriguez 2017).
Previous literature has shown that the impact of perceived advertising
value on advertising acceptance varies among customers depending on their
engagement with the social networks (Coursaris, Van Osch, and Balogh
2016; Rodriguez 2017; Cher and Arumugam 2019). Engagement with
advertising within a specific social media platform influences its evaluations
(Voorveld et al. 2018) and hence, will influence the perceived value
obtained from it. Furthermore, several recent literatures have shown that
customer engagement drives purchase intentions and behavior in an online
context (Islam, Rahman, and Hollebeek 2018; Heerde, Dinner, and Neslin
2019; McLean and Wilson 2019; Hollebeek and Macky 2019; Islam et al.
2020), hence, it needs to be explored well as it is an essential indicator of
the effectiveness of online advertising (Kujur and Singh 2018). The current
study purports that customer engagement with YouTube advertising may
moderate the power of the mediation effect that attitude toward YouTube
advertising has in the relationship of perceived YouTube advertising value
and purchase intentions toward advertised brands which are missing in the
existing literature. According to Wu (2016), customers, who are highly

engaged with social media advertising, will derive more value from it by
spending more time on it as such an advertisement gratifies their various
gratifications and needs. Depending upon that watching advertising stimu-
lates the interests of viewers to learn more about it, they feel good after
watching it and spend their time on YouTube advertising, their engage-
ment might be high or low (Hollebeek, Glynn, and Brodie 2014; Islam et
al. 2020). It is also observed that higher level of customer engagement will
lead to higher level of attitudes and behavioral intentions (Islam, Rahman,
and Hollebeek 2018; Abbasi et al. 2020).
Customer assessment of perceived advertising value also varies depending
on the degree of customer engagement toward YouTube advertising.
Customers, for whom the level of engagement is high, may perceive more
value from a YouTube advertisement than the ones who have a low level
of engagement (Wu 2016). Accordingly, a high level of customer engage-
ment will generate a more positive attitude toward advertising, leading to
favorable purchase intentions. This study, therefore, posits that the indirect
effect of perceived advertising value on purchase intentions toward adver-
tised brands via attitude toward advertising may vary across the levels of
CE toward YouTube advertising. Following this theorizing, the high cus-
tomer engagement toward YouTube advertising should amplify perceived
advertising value positively and in turn, may impact their attitudes toward
it. Therefore, the study hypothesized:
H5: Customer engagement towards YTadv positively moderates the indirect
relationship between perceived ad value and purchase intentions.
Methodology
The current study focuses on the perception of millennials toward YTadv
which they encounter while viewing YouTube videos. Aged between 23 and
38 years, millennials or generation Y is the population who was born
between the years 1981 and 1996 (Anubha and Shome 2020). Millennials
are educated, tech-savvy, connected, and are witty toward market gimmicks
including YTadv (Dimock 2019; Hamed 2017; Nielsen Research 2017).
Seventy two percent of them watch such videos regularly (Montana 2018)
to fulfill their different needs of information. Brightcove (2018) conducted
a video marketing survey among millennials. The survey revealed that 85%
of them have purchased a product based on a video advertisement. 56% of
them feel that video advertising is more appealing as compared to other
advertising formats. India has a total of 440 million millennials which con-
stitute 34% of the total Indian population (Ahluwalia 2018). They are
responsible for approximately 71% of household income (Ahluwalia 2018;
Table 1. Demographics of the respondents.

Variables Categories Frequency Percent
Gender Male 195 52.14
Female 179 47.86
Total 374 100
Age (in years) (Generation Y) 23–26 108 28.88
27–30 100 26.74
31–34 88 23.53
35–38 78 20.85
Total 374 100
Educational qualifications Graduate or less 164 43.85
Post Graduate 167 44.65
PhD 18 4.81
Others 25 6.69
Total 374 100
Mehta 2018; Bhargava 2017). Given their sheer size alone, this group of
people is incredibly valuable to global marketers and should be considered
in marketing strategies. Hence, marketers across the globe are targeting this
generation via YouTube advertising so as to create positive purchase inten-
tions toward such brands as this generation is highly active on YT.
Sample framework and collection of data

The current cross-sectional study collects data from YT viewers belonging
to Generation Y who come across various YTadv while consuming such
videos. The study uses convenience sampling as this is the most adopted
technique in various studies in the domain of social science (Othman et al.
2019). Data were collected by distributing the hard copies of the question-
naire in the Delhi NCR region including Noida, Delhi, Faridabad,
Gurugram, and Ghaziabad between November and December 2020. Delhi
NCR region was selected for data collection as this has a population from
all over India for education and employment reasons. The questionnaire
contained two filtered questions, one to ascertain that the respondent is a
millennial and the second was to assure that they are exposed to YTadv
while watching YouTube videos. Total 390 questionnaires were collected
back out of which 16 were canceled due to missing values, unengaged
responses, and the presence of outliers. In total 374 final responses were
retained for data analysis. Table 1 displays the demographics of the
respondents.
Sample size
Boomsma’s (1982) simulations were employed to determine the sample
size. The study, therefore, used the following formula to calculate the lower
bound of the sample size: n 50r2 – 450r þ 1100, with r ¼ total number of
indicators divided by the total number of latent variables. With 25
indicators and seven latent constructs in the present study, r ¼ 25/7 ¼ 3.57,
and hence for r ¼ 3.57, the lower bound of the sample size is 130. As the
sample size of the current study is 374, which is enough above the accept-
able size of 130 and therefore the sample size is adequate enough to per-
form the structural analysis (Westland 2010). Furthermore, following the
rule of thumb as suggested by (Nunnally 1978; Kahai and Cooper 2003)
which says that in structural analysis, the sample size should be a minimum
of ten times the number of variables and therefore, sample size (374)
chosen for the current study is appropriate.
Development of scale items

A meticulous analysis is needed for scale development as it serves as a
foundation over which valid relationships among the variables are estab-
lished. Therefore, items have been adopted carefully from the previous lit-
erature after incorporating a few modifications so as to fit in the
framework of the present study. Entertainment was measured with three
items derived from Ducoffe (1996). Similarly, the scale of informativeness
included three items adapted from Ducoffe (1996). Credibility has been
measured using three items from (Brackett and Carr 2001) and one from
Tsang, Ho, and Liang (2004). Four items were adapted from Wells, Leavitt,
and McConville (1971) to measure Personal Relevance. Attitude toward
YTadv has been further accessed based on three items from Wang and Sun
(2010) and two items from MacKenzie and Lutz (1989). Purchase
Intentions were measured with three items of Coyle and Thorson (2001).
Customer engagement was appraised through three items adapted from
Hollebeek, Glynn, and Brodie (2014) and Islam et al. (2020). A five-point
Likert scale was used to measure all scale items in which one indicated
strongly disagree and five denoted strongly agree. Scale items along with
their sources are shown in Table 2.
Control variables
Since the age and gender of the respondents may influence purchase inten-
tions toward advertised brands (Shaouf, L€ u, and Li 2016), therefore, these
variables were used as control variables in this study. These variables were
controlled only to elucidate their effects on variables included in the con-
ceptual model. Consequently, the present study has not examined the mod-
erating effects of gender and age in the relationship of exogenous variables
with endogenous variables
Table 2. Scale items and their adaption sources.

Constructs Scale items Description Sources
Entertainment ENT1 YouTube advertising is entertaining Ducoffe (1996)
ENT2 YouTube advertising is pleasing Ducoffe (1996)
ENT3 YouTube advertising is enjoyable Ducoffe (1996)
Informativeness INF1 The YouTube advertising provides timely Ducoffe (1996)
information
INF2 YouTube advertising supplies relevant product Ducoffe (1996)
information
INF3 YouTube advertising is a good source of Ducoffe (1996)
product information
Credibility CRD1 YouTube advertising is credible Brackett and Carr (2001)
CRD2 YouTube advertising is trustworthy Brackett and Carr (2001)
CRD3 YouTube advertising is believable Brackett and Carr (2001)
CRD4 I believe that YouTube advertising is a good Tsang, Ho, and
reference for purchasing products Liang (2004)
Personal relevance PRL1 YouTube advertising is important to me Wells et al. (1971)
PRL2 YouTube advertising is meaningful to me Wells, Leavitt, and
McConville (1971)
PRL3 For me YouTube advertising is worth Wells, Leavitt, and
remembering McConville (1971)
PRL4 YouTube advertising is valuable for me Wells, Leavitt, and
McConville (1971)
Attitude toward ATA1 Overall, I consider YouTube advertising a Wang and Sun (2010)
advertising (ATadv) good thing
ATA2 Overall, I like YouTube advertising Wang and Sun (2010)
ATA3 I consider YouTube advertising very essential Wang and Sun (2010)
ATA4 I am satisfied with YouTube advertising MacKenzie and
Lutz (1989)
ATA5 Overall, YouTube advertising is positive MacKenzie and
Lutz (1989)
Purchase intentions PUI1 It is very likely that I will purchase the product Coyle and Thorson (2001)
advertised on YouTube
PUI2 I will definitely try the product advertised Coyle and Thorson (2001)
on YouTube
PUI3 I will purchase the product advertised on Coyle and Thorson (2001)
YouTube next time I need a product.
Customer Engagement CE1 Watching YouTube advertising stimulates my Hollebeek, Glynn, and
interest to learn more about advertised Brodie 2014; Islam et
brand so I avoid skipping it. al. 2020
CE2 I feel good when I watch YouTube Advertising Hollebeek, Glynn, and
if I am interested in brand, product Brodie 2014; Islam et
or service. al. 2020
CE3 I spend a lot of time in watching YouTube Hollebeek, Glynn, and
advertising when I am familiar with the Brodie 2014; Islam et
brand, product or service. al. 2020
Data analysis and findings

Before checking the quality of data using Exploratory Factor Analysis
(EFA), data were checked for critical assumptions like normality, multivari-
ate collinearity, and outliers which are required to be met for structural
testing. Then, the proposed model’s fitness, validity, and reliability were
ascertained using Pooled Confirmatory Factor Analysis (PCFA).
Conditional process modeling (PROCESS macro) as suggested by Hayes
(2017) was employed to test the proposed hypotheses for mediation and
moderated mediation. A number of recent studies published in prestigious
journals have employed PROCESS macro successfully (Arya, Sethi, and
Table 3. Skewness and Kurtosis.

Descriptive statistics
Skewness Kurtosis
N Minimum Maximum Mean Std. deviation
Statistic Statistic Statistic Statistic Statistic Statistic Std. error Statistic Std. error
ATadv 374 1.00 4.60 3.3321 0.71939 –0.592 0.126 0.100 0.252
Purchase intentions 374 1.00 5.00 2.8241 1.00225 –0.158 0.126 –0.410 0.252
PVadv 374 –1.65 0.71 –0.0089 0.43685 –1.484 0.126 2.696 0.252
Valid N (listwise) 374
Table 4. Collinearity diagnostics.

Coefficientsa
Unstandardized coefficients Collinearity statistics
Standardized coefficients
Model B Std. error Beta t Sig. Tolerance VIF
1 Constant 0.408 0.192 2.131 .034
PVadv 0.680 0.093 0.296 7.336 .000 0.884 1.131
ATadv 0.727 0.056 0.522 12.919 .000 0.884 1.131
a
Dependent variable: purchase intentions.
Paul 2019; Khan et al. 2019). The results of data analysis are presented in
this section.
Assumptions assessment
Skewness and kurtosis were calculated to examine the data normality. The
values of skewness and kurtosis in Table 3 fall within the acceptable limits
(skewness ± <2, kurtosis ± <3), assuring the normality of the data (George
and Mallery 2010; Hair et al. 2010). Multivariate collinearity was checked
by the Variance Inflation Factor (VIF) and tolerance. Table 4 proves that
VIF and tolerance lie within the tolerable limits (VIF < 2, tolerance > 0.5),
and hence, multi-collinearity is not a threat (Hair et al. 2010; Dwivedi and
Merrilees 2013). Furthermore, multicollinearity is not a problem in the
study as correlations among all the three constructs (shown in Table 5) are
less than 0.80 (Jalali, Jaafar, and Ramayah 2014). The study has chosen a
sample size of 374 which is adjudged as relevant for structural analysis
with confidence level set at 95% and error margin at 5%, since the popula-
tion is very large consisting of millions of people (Erkan and Evans 2016).
Exploratory factor analysis

EFA was employed to ascertain the quality of data. Biasness-testing is sig-
nificant when data collection involves a self-reported questionnaire and the
same respondent provides both the predictor variable along with the criter-
ion variable (Arya, Sethi, and Paul 2019). Therefore, Common Method
Variance (CMV) was gauged by Harman’s single factor test. The first factor
Table 5. Validity values.

CR AVE MSV ASV PVadv ATadv Purchase intentions
PVadv 0.915 0.729 0.291 0.226 0.854
ATadv 0.885 0.607 0.500 0.331 0.402 0.779
PVadv 0.905 0.761 0.500 0.395 0.539 0.707 0.872
Notes: Output was calculated using Stats Tool Package (Gaskin 2016). Values in bold represent the square root
of AVE.
was found to explain only 36.61% of variance which is lesser than 50%
(Anubha and Shome 2020; Arya, Sethi, and Paul 2019; Podsakoff et al.
2003), hence the measures are free from biasness (Harman 1960).
Confirmatory factor analysis, validity, and reliability

Constructs’ reliability was checked via Cronbach alpha and Composite
Reliability (CR). Cronbach alpha calculated values for all the constructs were
found to be between 0.71 and 0.90 which is more than the threshold limit
(a 0.70) and therefore, the reliability of the proposed model is confirmed
(Anubha and Hooda 2019; Hair et al. 2010; Fornell and Larcker 1981). All
CR values came out to be more than 0.89 which is also above 0.70, the min-
imum tolerance value (Fornell and Larcker 1981; Hair et al. 2010).
Consequently, the reliability and consistency of the data were vouched.
To test the fitness of the model, the study employed PCFA. All the fit
indices as given in Table 6 met the acceptable criteria. Consequently, the
proposed model is a good fit for data. After running PCFA, it was found
that all the scale items belonging to a specific construct were found to have
standardized factor loadings of more than 0.62 which is above the accept-
able limit of 0.60 (Hair et al. 2010). All the CR values given in Table 5 are
found to be >0. Furthermore, the Average Variance Extracted (AVE) for
all the constructs shown in Table 5 was above 0.5, the minimum threshold
value (Prusty, Anubha, and Gupta 2021; Hair et al. 2010; Fornell and
Larcker 1981). Also, CR > AVE. This is a clear indication that all the items
related to a particular construct are significantly correlated and hence con-
vergent validity is ensured as CR > 0, CR > AVE, AVE > 0.5 (Hair et al.
2010). Discriminant validity indicates the degree to which a particular con-
struct of the study is dissimilar from its counterparts. For the existence of
discriminate validity, these two conditions must be fulfilled:
AVE > maximum shared variance (MSV) and AVE > average shared vari-
ance (ASV). It is evident from Table 5 that AVE values exceeded both
MSV as well as ASV values. Also, the square root of AVE (shown in bold
in Table 5) was more than the correlation of a specific construct with other
constructs (Fornell and Larcker 1981). Hence, discriminant validity
is ensured.
430
ANUBHA AND S. SHOME
Table 6. Various fit indices.

Root mean Standardized
Goodness of square error of Root mean Normed Comparative Tucker–Lewis root mean
Fit indices v2/df fit index approximation square residual fit index fit index index square residual
Recommended threshold 1 <v2/df <3 0.90 0.08 < 1 0.08 < 1 0.90 0.90 0.90 <0.08
(Hair et al. 2010)
Values obtained by PCFA 1.9 0.918 0.049 0.032 0.913 0.956 0.95 0.044
ATadv as a mediator between PVadv and purchase intentions

Mediation was accessed using simple mediation model 4 as explained by
Hayes (2017). This model focusses on estimating the direct and indirect
effects of X on Y. The direct effect includes the path that goes directly
from X to Y without going via M, whereas, the indirect effect is calculated
through M, a mediator which lies between X and Y (X ¼ > M ¼ > Y).
The direct and indirect, effects can be calculated by using the two Ordinary
Least Square (OLS) regression equations. The first regression equation esti-
mates the value of M from X:
M ¼ iM þ aX þ eM (1)
The second equation estimates the value of Y from the values of both X
and M:
Y ¼ iY þ c0 X þ bM þ eY (2)
where
a ¼ regression coefficient showing the direct effect of X on M;
b ¼ regression coefficient showing the direct effect of M on Y;
c0 ¼ regression coefficient showing the direct effect of X on Y;
iM and iy ¼ regression intercepts; and,
eM and eY ¼ estimation errors.
According to Hayes (2017), the indirect effect of X on Y via mediator M
can be calculated by multiplying a and b attained from (1) and (2) equa-
tions:
Indirecteffect ¼ ab (3)
Furthermore, the total effect of X on Y can be calculated by the follow-
ing OLS regression model:
Y ¼ iY þ cX þ eY (4)
where c ¼ regression coefficient measuring the total effect.
Also, total effect ¼ direct effect þ indirect effect
c ¼ c0 þ ab (5)
or, Indirect effect ¼ Total effect – direct effect
ab ¼ c c0 (6)
It can be inferred from equation (6), that the indirect effect is calculated by
subtracting the direct effect taking M as constant from the total effect. The
conceptual and statistical depictions of model 4 are shown in Figures 2 and 3.
The calculated output generated through Model 4 has been shown in
Table 7. The total effect of PVadv on purchase intentions was accessed
using OLS regression equation (3) which showed that slope coefficient
Figure 2. Conceptual model (model 4) – indirect effect of X on Y through M, a mediating

variable (Hayes 2017).
Figure 3. Statistical model (model 4): indirect effect of X on Y through M (Hayes 2017).
(c ¼ 1.0875) is positive and significant with the standard error (s.e.) ¼

0.1047, p ¼ .00, R2 ¼ .2247 and R ¼ .4740. Furthermore, the direct effect
(c’) of PVadv on purchase intentions, calculated using equation (2), was
also found to have a significant and positive slope of 0.6796 with s.e. ¼
0.0926 with R ¼ .682, R2 ¼ .4652, t ¼ 7.3358 and p ¼ .00. Also, zero is not
included between 95% confidence interval lower limit (LLCI) ¼ 0.4975 and
upper limit (ULCI) ¼ 0.8618 while ATadv remains constant. Hence H1 is
supported. Model 1 of Table 7 clearly shows that PVadv has a significant
impact on attitude with slope coefficient (a ¼ 0.5611) with s.e. ¼ 0.0803,
p ¼ .00, R2 ¼ .1161, R ¼ .3408, t ¼ 6.9906. Furthermore, the LLCI ¼ 0.4033
and ULCI¼ 0.7190 also did not include zero, hence H2 is supported. It is
also evident from the results of Table 7 that a positive attitude toward
advertising (ATadv) will result in positive purchase intentions (b ¼ 0.7268)
with s.e.¼ 0.0563, t ¼ 12.9190, p ¼ .000 and zero is not lying between LLCI
¼ 0.6162 and ULCI ¼ 0.8375 supporting H3.
Furthermore, it is evident from the output of Table 7 (models 2 and 3) that
if the attitude is added to the total effect equation (3), then there is a significant
Table 7. Results of mediation by Hayes macro (model 4).

Model 1
Outcome variable: (ATadv)
R R2 MSE F df1 df2 p
.3408 .1161 0.4587 48.8687 1.0000 372.0000 .0000
Variables Coefficient SE t p LLCI ULCI
Constant 3.3371 0.0350 95.2721 .0000 3.2682 3.4059
PVadv 0.5611 0.0803 6.9906 .0000 0.4033 0.7190
Model2
Outcome variable: purchase intentions
.6821 .4652 0.5401 161.3902 2.0000 371.0000 .0000
Constant 0.4082 0.1916 2.1311 .0337 0.0316 0.7849
PVadv 0.6796 0.0926 7.3358 .0000 0.4975 0.8618
ATadv 0.7268 0.0563 12.9190 .0000 0.6162 0.8375
Model 3: Total effect model
.4740 .2247 0.7809 107.8035 1.0000 372.0000 .0000
Constant 2.8337 0.0457 62.0013 .0000 2.7348 2.9236
PVadv 1.0875 0.1047 10.3828 .0000 0.8815 1.2935
Total effect of X on Y
Effect SE t p LLCI ULCI
1.0875 0.1047 10.3828 .0000 0.8815 1.2935
Direct effect of X on Y
0.6796 0.0926 7.3358 .0000 0.4975 0.8618
Indirect effect(s) of X on Y:
Effect BootSE BootLLCI BootULCI
ATadv 0.4079 0.0849 0.2462 .5830
Partially standardized indirect effect(s) of X on Y:
ATadv 0.4069 0.0823 0.2517 .5781
Completely standardized indirect effect(s) of X on Y:
ATadv 0.1778 0.0352 0.1092 .2498
increase in R2 of the model from 0.2247 to 0.4652 which is a shred of sufficient

evidence to rely on the role of attitude as a mediator. The indirect effect of
PVadv on purchase intentions via attitude (ab ¼ 0.4079) as summarized in
Table 7 was entirely above zero as LLCI ¼ 0.2462 and ULCI ¼ 0.5830. Hence,
the effect is significant at p < .05 indicating the presence of mediation.
Furthermore, partially standardized indirect effect 0.4069 was also found to be
above zero with LLCI ¼ 0.2517 and ULCI ¼ 0.5781. Similarly, the completely
standardized indirect effect 0.1778 did not include zero in both the limits as
LLCI ¼ 0.1092 and ULCI ¼ 0.2498. All the measures of various effect sizes
have a 95% confidence interval entirely above zero, which is clear evidence that
the indirect effect is greater than no effect, hence H4 is supported.
Assessment of the moderated mediation effects

The current study has proposed that customer engagement toward
YTadv moderates the relationship between PVadv and mediator (attitude
Figure 4. Conceptual diagram (model 7): moderator W moderating the relationship between X
and mediator M (Hayes 2017).
Figure 5. Statistical diagram (model 7): conditional indirect effect of X on Y through M and
moderator W (Hayes 2017).
toward YTadv). The moderated mediation effect was examined with

Model 7 of PROCESS macro which is a conditional process model. This
model was used to measure the strength of the indirect relationship
between PVadv and purchase intentions for both (low and high) values
of customer engagement, the moderator in the current study. The con-
ceptual and statistical diagrams of model 7 have been shown in Figures
4 and 5 respectively. The indirect effect of X is calculated using two
OLS regression equations.
The first equation estimates M as a linear function of X where the effect
of X is linearly related to W:
M ¼ iM þ a1X þ a2W þ a3XW þ eM (7)
The second equation estimates Y from X and M both

Y ¼ iY þ c’X þ bM þ eY (8)
According to the mediation model, X influences Y in both ways direct
and indirect. The effect of X on M is not a1 in equation (7). Rather, the
effect of X on M is a function of W in this model, as revealed by rewriting
equation (7) in an equivalent form:
M ¼ iM þ ða1 þ a3WÞX þ a2W þ eM (9)
The conditional indirect effect of X on Y through M denoted as x is the
product of the conditional effect of X on M from equation (7) and the
effect of M on Y controlling for X in equation (8)
x ¼ ða1 þ a3 WÞb (10)
Equation (10) can be rewritten as;
x ¼ a1 b þ a3 bW
where a1b ¼ the regression intercept; and a3b ¼ slope of the line.Weight for
W ¼ a3b (the index of moderated mediation).
Furthermore, the moderator, customer engagement was split into two
categories viz. high customer engagement and low customer engagement
on the basis of the median value (Souiden Chtourou, and Korai 2017).
Results of moderated mediation are shown in Tables 8 and 9. Table 9
shows that the interaction between perceived AD value (PVadv) and cus-
tomer engagement was statistically significant (a3 ¼ 0.3980, s.e. ¼ 0.1764,
p < .05), suggesting that customer engagement moderates the effect of per-
ceived ad value (PVadv) on attitude. Furthermore, it is evident from Table
8 that when customer engagement is low (represented by 0), the effect was
positive and significant (b ¼ 0.3023, s.e. ¼ 0.1491, p < .05). Also, when cus-
tomer engagement is high (represented by 1), perceived AD value (PVadv)
was a significant positive predictor (b ¼ 0.7003, s.e. ¼ 0.0942, p < .001).
The same results are depicted through the interaction graph in Figure 6
which illustrates that customer engagement strengthens the positive rela-
tionship between PVadv and ATadv. It is also evident from Figure 6 that
the slope is steeper for the high level of customer engagement than for the
low level of customer engagement.
Furthermore, conditional Indirect Effects (IE) of perceived AD value
(PVadv) on purchase intentions are positive both; at low engagement, IE ¼
0.2197 and at high engagement, IE ¼ 0.5090. They also do not include
zero as LLCI ¼ 0.0087; ULCI ¼ 0.4450 for low customer engagement and
LLCI ¼ 0.2978; ULCI ¼ 0.7467 for high customer engagement which indi-
cates the presence of moderated mediation (Table 8). Index of moderated
mediation (Hayes 2015), an omnibus test of the conditional indirect effect
Table 8 Results of moderated mediation by Hayes macro (model 7).

Model: a
Outcome variable: (ATadv)
.3817 .1457 0.4457 21.0376 3.0000 370.0000 .0000
constant 3.2337 0.0545 59.2887 .0000 3.1265 3.3410
PVadv 0.3023 0.1491 2.0274 .0433 0.0091 0.5955
Customer Engagement 0.1840 0.0708 2.5978 .0098 0.0447 0.3233
Int_1 0.3980 0.1764 2.2565 .0246 0.0512 0.7449
Product terms key:
Int_1: PVadv x customer engagement
Test(s) of highest order unconditional interaction(s):
R2-chang F df1 df2 p

XW .0118 5.0918 1.0000 370.0000 .0246
Model: b
Focal predictor: PVadv (X)
Moderating variable: customer engagement (W)
Conditional effects of the focal predictor at values of the moderator(s):
Customer engagement Effect SE t p LLCI ULCI

0.0000 0.3023 0.1491 2.0274 .0433 0.0091 0.5955
1.0000 0.7003 0.0942 7.4317 .0000 0.5150 0.8857
Model C

.6821 .4652 0.5401 161.3902 2.0000 371.0000 .0000
constant 0.4022 0.1913 2.1027 .0362 0.0261 0.7783
PVadv 0.6796 0.0926 7.3358 .0000 0.4975 0.8618
ATadv 0.7268 0.0563 12.919 .0000 0.6162 0.8375
Direct effect of X on Y

0.6796 0.0926 7.3358 0 0.4975 0.8618
Conditional indirect effects of X on Y:
PVadv -> ATadv-> purchase intentions
Customer Engagement Effect BootSE BootLLCI BootULCI

0.0000 0.2197 0.1116 0.0087 .4450
1.0000 0.5090 0.1131 0.2978 .7467
Index of moderated mediation (difference between conditional indirect effects):
Index BootSE BootLLCI BootULCI

Customer Engagement 0.2893 0.1507 0.0063 .6015
Pairwise contrasts between conditional indirect effects (effect1 minus effect2)
Effect1 Effect2 Contrast BootSE BootLLCI BootULCI

0.5090 0.2197 0.2893 .1507 0.0063 0.6015
(Preacher, Rucker, and Hayes 2007) of perceived AD value (PVadv) on

purchase intention does not contain zero as LLCI ¼ 0.0063 and ULCI ¼
0.6015, it can be inferred that the indirect effect is conditional on both the
levels of customer engagement, the moderator. Hence it can be inferred
that customer engagement significantly moderated the indirect effect of
PVadv on purchase intention and H5 is supported.
Table 9. Model coefficients for the conditional process model.

Outcome variables
ATadv Purchase intentions
Antecedents Coefficients S.E. p Coefficients S.E. p
X a1 0.3023 0.1491 <.05 c’ 0.6796 0.0926 <.001
W a2 0.1840 0.0708 <.05
XxW a3 0.3980 0.1764 <.05
M b 0.7268 0.0563 <.001
Constant iM 3.2337 0.545 <.001 iY 0.4022 0.1913 <.05
R2 ¼ .15 R2 ¼ .47
F (3,370) ¼ 21.037, p < .001 F (2,371) ¼ 161.39, p < .001
5.0
4.5
4.0
Atude towards Adversing
3.5
3.0
2.5
Low Customer Engagement
2.0
High Customer Engagement
1.5
1.0
0.5
0.0
Low High
Perceived Adversing Value
Figure 6. Interaction graph showing customer engagement as a moderator.
Discussion
The results of the study disclosed that millennials’ attitude toward YTadv
mediates the relationship between PVadv and purchase intentions. The
study further confirms that this mediation is partial as direct and indirect
effects of PVadv on purchase intentions were found to be significant. Aziza
and Astuti (2019) have also confirmed the direct effect of PVadv on pur-
chase intentions as significant. The study also proves that PVadv directly
influences the attitudes toward YTadv. This relationship between perceived
ad value (PVadv) and attitude toward adv was also found significant by a
number of researchers (Nabila and Achyar 2020; Gaber, Wright, and Kooli
2019; Aktan et al. 2016). Additionally, this study revealed that millennials’
attitude toward YTadv significantly impacts their purchase intentions which
are in line with the findings of Nabila and Achyar (2020). However, atti-
tude toward adv as a mediator between PVadv and purchase intentions
makes this study stands apart from others, concentrating on the fact that
attitude toward advertising has more explanatory power to explain pur-
chase intentions. This can be attributed to the fact that viewers evaluate an
advertisement from both angles hedonic and utilitarian. The hedonic value
of an advertisement is based on the entertaining contents it includes.
Perceived advertising value, though, results in positive purchase intentions.
Nevertheless, when viewers evaluate a YT adv from a utilitarian angle for
informativeness and credibility along with a hedonic angle, the overall pur-
chase intentions are also influenced by its personal relevancy for them.
The majority of the available literature (Brackett and Carr 2001; Ducoffe
1996; Dehghani et al. 2016; Yang et al. 2017) have identified the entertain-
ment, credibility, personal relevance, and informativeness as independent
antecedents of PVadv, which affects attitude toward adv or attitude toward
a brand or purchase intentions. The results of the current study find sup-
port from the aforementioned studies and confirm that PVadv influences
millennials’ attitudes toward such advertising and result in the creation of
positive purchase intention due to their increased capabilities to evaluate
such advertising based on various criteria viz. entertainment, informative-
ness, personal relevance, and credibility (Nabila and Achyar 2020).
The moderating role of customer engagement further generated stimulat-
ing results. The study revealed that customer engagement significantly
moderated the relationship between PVadv and ATadv. The positive rela-
tionship between PVadv and ATadv is strengthened in the presence of cus-
tomer engagement. The results of the study confirmed that the strength of
the relationship between PVadv and ATadv was found to be significantly
stronger for the high level of customer engagement as compared to the low
level. These findings reveal that a high level of customer engagement
enhances the relationship between perceived ad value and attitude
toward adv.
Theoretical and managerial implications

Based on the findings, the current study offers various theoretical and prac-
tical implications which are discussed here.
Theoretical implications
This study contributes to the existing marketing literature by various means.
First, the studies, examining the effectiveness of advertising in the context of
YouTube, are very limited (Dehghani et al. 2016; Yang et al. 2017;
Uparimart 2018; Aziza and Astuti 2019; Firat 2019; Nabila and Achyar
2020). Furthermore, all these studies have used PVadv as a first-order
construct to study the effectiveness of YTadv. However, in this study, PVadv

value has been investigated as a second order construct to examine its effect
on purchase intentions which provides further insights into advertising litera-
ture. Hence, it is a novel contribution to the current literature as it will pro-
vide better insights to analyze the advertising effectiveness.
Secondly, this study proposes a comprehensive moderated mediation
approach to examine the impact of PVadv in the context of YouTube on
purchase intentions. The study endorses that the effect of PVadv in the
context of YouTube on the purchase intentions toward advertised products
are mediated by attitudes toward such advertising. This mediation effect is
then moderated by customer engagement. The study reveals that attitude
toward YTadv partially mediates the relationship of PVadv in the context
of YouTube with purchase intentions and customer engagement has mod-
erated mediation effect in this relationship. The current study, thus, empir-
ically validates the proposed moderated mediation model. Such moderated
mediation approach has not yet been applied in the context of YouTube
advertising. This indicates a gap and this study contributes to the advertis-
ing literature by filling this important gap.
Thirdly, this study seems to be a pioneer in applying and extending BCM
to examine the PVadv in YouTube on purchase intentions to judge the adver-
tising effectiveness. The results demonstrate that the PVadv inclines to differ
between high and low customer engagement toward YTadv. It indicates that
highly engaged customers perceive more value in a YTadv. Therefore, this
study provides more insights into BCM, particularly in the context of online
advertising. Fourthly, no study has applied BCM to investigate the effects of
mediating and moderating variables simultaneously in the association of
PVadv and purchase intentions. This study supplements the BCM literature
by applying it to propose a moderated mediation model which shows that the
impact of PVadv in the context of YouTube on purchase intentions is influ-
enced by a mediator and moderator at the same time. Thus, in the future,
studies could use BCM to examine moderated mediated model in examining
the effectiveness of online advertising in various other contexts.
Fifthly, the present study examines the influence of PVadv in the context
of YT on the attitudes toward YTadv. This study also explores the attitude
formation process based on BCM. The findings authenticate BCM as a suit-
able framework for understanding attitudes toward YTadv, therefore, signi-
fying one more contribution to the BCM literature. Lastly, only a few
studies have investigated the effectiveness of YouTube advertising from the
perspective of Generation Y customers (Dehghani et al. 2016; Aziza and
Astuti 2019). Hence the present study fulfills this gap and contributes to
the Generation Y literature.
Practical implications
The study provides several significant practical implications for marketers.
The findings are useful to marketers in improving both attitude and pur-
chase intentions through PVadv. The results suggest that PVadv in the con-
text of YouTube drives both attitudes toward YTadv and purchase
intentions, further indicating that increasing PVadv will improve both out-
comes. Therefore, the current study recommends to marketers design their
YTadv in such a way which provide more value to Generation Y custom-
ers. Correspondingly, YTadv should be based on humor appeal to satisfy
the hedonic needs of customers. The strategy to use humor in advertising
the brands will increase the probability of making YTadv campaigns
impactful and memorable for their viewers. This will create a more mean-
ingful relationship between a brand and its target audience and will make
them engaged. Such customer engagement in turn will improve attitudes
and will boost their purchase intentions. Additionally, marketers should
demonstrate credibility in their YTadv. It will enhance the PVadv in the
context of YT for a customer as credibility produces trust. The core idea of
the credibility hinges on showing that the advertised product really per-
forms as has been promised. The strategy to infuse credibility in a YTadv
will improve the chances of being listened to in a crowded place where cus-
tomers are overburdened with information overload. Therefore, instead of
creating an impression of credibility marketers should create a product
packed with supreme performance and then should signify credibility in
their advertisement through demonstration. To improve credibility further
in a YTadv, marketers can provide customers a chance to try their product.
It will increase customers’ confidence in their advertisements and will pro-
vide them more value. This will make customers engaged and will influence
their attitudes and purchase intentions.
Next, marketers should provide timely and relevant information in their
YouTube advertisements. Such up-to-date information will attract the
attention of Generation Y customers and will improve the value of YTadv.
This improved value will make them more engaged toward YTadv which
will influence their attitudes as well as purchase intentions. Kaur et al.
(2020), in the context of virtual brand communities (VBC), observed that
the targeted contents will increase customers’ sense of belonging and iden-
tification which will increase their engagement with VBC. Correspondingly,
marketers can target their customers based on their demographics, interests
and shopping behaviors. Such type of personalization will provide them a
better experience, and therefore, will increase their engagement with the
YTadv. Such increased engagement in turn will lead to the formation of
positive attitudes and favorable purchase intentions. In the light of the
above implications, the current study opined that Generation Y customers
perceived advertising value will be more if they are convinced with the
contents of the advertising.
Correspondingly, marketers are advised to improve PVadv by making it
more entertaining, informative, credible and personally relevant, which in
turn will make Generation Y customers more engaged. This will improve
their attitudes and purchase intentions. When they feel that the advertise-
ment is entertaining, informative, credible and personally relevant, they are
likely to perceive more value from it (Dehghani 2016). That is, by increas-
ing PVadv in the context of YouTube, marketers will elevate customer
engagement. In other words, customers who perceive more value in a
YTadv, are likely to have a more positive attitude and favorable purchase
intentions. It highlights the strategic importance of perceived value for
improving the effectiveness of online advertising in the context of
YouTube. Additionally, brands on YouTube can enhance Generation Y
customer engagement by including distinct calls to action (CTA) at the end
of the advertising which allows them to directly purchase a product. This
may increase the propensity to buy advertised products which is the ultim-
ate goal of any business to sustain in the present competitive landscape.
Limitations and direction for future research

This study has few limitations which offer opportunities for research in the
future. First, the study focuses only on Generation Y and therefore the
results cannot be generalized to other generational cohorts. Therefore,
future studies can be conducted with samples from other generations as
behavioral differences exist among various generations. Second, this study
has been undertaken in India. However, other countries should also be
explored to examine the impact of perceived YTadv value on the purchase
intentions of millennials to get future insights as marketers to advertise on
YT to target a global audience. As the data for the study was collected only
from Delhi-NCR, other geographical locations of India can also be explored
in future studies. Furthermore, the proposed model validates only for
YouTube. The role of perceived ad value may vary on other social media
sites viz. Facebook, Twitter, and Instagram are equally popular among mil-
lennials. The future validation of the model in the context of the above-
mentioned social media sites, therefore, can offer new insights and add
value to advertising literature. Here, attitude toward advertising has been
examined as a mediator, future researchers may test other contemporary
mediators like ad congruency, brand love, brand experience, brand image,
and brand trust to understand the role of perceived ad value on purchase
intentions. Furthermore, customer engagement moderated the relationship
between perceived ad value and attitude toward adv, hence future
researchers can exploit customer engagement with the aforementioned

mediators to get fruitful insights into the subject matter.
Conclusion
Since long back, advertising has been used to inform, motivate, and per-
suade prospective customers about various products and brands. The popu-
larity of online digital video advertising has changed the advertising
landscape. In their pursuit, to target millennials who are tech-savvy, have
more faith in such advertising videos, and spend a significant portion of
their time on YouTube, marketers are increasing their YT advertising
budget to target such generation (Dimock 2019; Foye 2018). Therefore, the
current study concludes that millennials’ purchase intentions are based on
YTadv. The study also provides ample empirical evidence for the use of
attitude toward advertising as a predictor of purchase intentions for prod-
ucts and brands advertised on YT. However, the purchase intentions are
not only governed by millennials’ attitudes. The kind of value which mil-
lennials perceive in YT advertising based on its credibility, informativeness,
entertainment, and personal relevancy plays a substantial role in shaping
their attitudes toward it. Hence, perceived advertising value not only shapes
purchase intentions directly but also through the presence of attitude
toward such advertising. The current study reflects the conclusion that the
purchase intentions of millennials are getting stronger while their attitude
toward YouTube advertising is shaped as a mediator (PVadv ! ATadv !
purchase Intentions). As such, marketers get enough insights to design
their advertising on YT strategically in such a way that not only enhances
millennials’ perceived advertising value but also influences their attitudes
favorably by increasing their engagement level with such advertising. The
resultant purchase intentions will increase the propensity to buy these
advertised products and brands which is the ultimate goal of advertising.
ORCID
Anubha http://orcid.org/0000-0002-2719-7697
Samik Shome http://orcid.org/0000-0001-8618-6763
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Customer Engagement and Advertising

Anubha & Samik Shome

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Customer Engagement and Advertising Effectiveness: A

CONTACT Samik Shome samik@nirmauni.ac.in Institute of Management, Nirma University, Ahmedabad,

shows the impact of overall perceived value rather than of individual

examined such mediating and moderating effects separately (Hongyan and

Figure 1. The proposed model.

current study proposes a comprehensive moderated mediation model

1. Does perceive advertising value by impacting the purchase intentions for

brands. Second, the perceived advertising value has been tested as a

advertisements. These advertisements, which include videos, banners and

profitable businesses, earning $19.8 billion in 2020. Based on these statis-

Conceptual model and hypotheses development

The second driver of perceived value in a YouTube advertisement is

personal relevance) on purchase intention in the context of online advertis-

Perceived advertising value leading to attitude

Attitude leading to purchase intentions

Attitude as a mediator toward purchase intentions

Moderated mediation effect of customer engagement

may vary in direction and magnitude and shows a significant influence on

existing literature. According to Wu (2016), customers, who are highly

Table 1. Demographics of the respondents.

Sample framework and collection of data

Development of scale items

Table 2. Scale items and their adaption sources.

Data analysis and findings

Table 3. Skewness and Kurtosis.

Table 4. Collinearity diagnostics.

Exploratory factor analysis

Table 5. Validity values.

Confirmatory factor analysis, validity, and reliability

Table 6. Various fit indices.

ATadv as a mediator between PVadv and purchase intentions

Figure 2. Conceptual model (model 4) – indirect effect of X on Y through M, a mediating

(c ¼ 1.0875) is positive and significant with the standard error (s.e.) ¼

Table 7. Results of mediation by Hayes macro (model 4).

increase in R2 of the model from 0.2247 to 0.4652 which is a shred of sufficient

Assessment of the moderated mediation effects

toward YTadv). The moderated mediation effect was examined with

The second equation estimates Y from X and M both

Table 8 Results of moderated mediation by Hayes macro (model 7).

R2-chang F df1 df2 p

Customer engagement Effect SE t p LLCI ULCI

R R2 MSE F df1 df2 p

Effect SE t p LLCI ULCI

Customer Engagement Effect BootSE BootLLCI BootULCI

Index BootSE BootLLCI BootULCI

Effect1 Effect2 Contrast BootSE BootLLCI BootULCI

(Preacher, Rucker, and Hayes 2007) of perceived AD value (PVadv) on

Table 9. Model coefficients for the conditional process model.

Theoretical and managerial implications

construct to study the effectiveness of YTadv. However, in this study, PVadv