| Summary: | Virtual Influencers (VIs) are artificially-generated characters that are designed to behave
like real social media influencers. These digital natives are becoming increasingly popular
as brands seek new ways to engage with younger audiences. Being a fresh subject of interest, extant literature has mainly explored VIs through key differences from their human
counterpart. However, it is unclear how users may perceive these digital creations.
This study examines the interaction between VIs and generation Z Instagram users in
terms of Parasocial Interaction and perceived VIs’ attributes, with Customer Engagement
as the outcome. A measurement model was developed with credibility, authenticity, humanization, and novelty value being the key VIs’ attributes. Primary data was collected
through an online survey (N=221).
The findings show significant positive impacts of Parasocial Interaction with VIs on Customer Engagement. However, this effect is partially mediated by the perception of VIs’
credibility and novelty value. The measurement model explains 73% of Customer Engagement, with novelty value having the strongest effect on this outcome.
The research provides theoretical contributions to the B2C endorsement literature while
bridging the gap between VIs and younger audiences' outcomes. Managerial implications
reveal how brands can harness the benefits of implementing these novel characters.
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