How to Better Target and Incent Paid Endorsers in Social Advertising Campaigns: A Field Experiment

We investigate paid endorsement as a crowd-sourcing social advertising mechanism that allows advertisers to bypass publishers (e.g., Facebook) and recruit individual endorsers of their own choice at affordable prices. Specifically, we investigate (i) how incentives affect endorsers’ participation and effectiveness, (ii) what types of endorsers are most effective in generating online engagement (likes, comments, and retweets), and (iii) the potential differences between generating different types of engagements. We conduct a large scale field experiment in which we manipulate exogenously pay rates and eligibility to participate. Our findings suggest that increasing financial incentive doesn’t necessarily improve participation rate. In addition, endorsers who are effective are often not responsive. Further, it can be misleading to assess the attractiveness of endorsers simply based on observed engagements. Our findings provide new insights on how marketers can improve the effectiveness of paid endorsement by identifying and incentivizing high potential endorsers.