Effects of transparent brand communication on perceived brand authenticity and consumer responses

Purpose This study aims to understand the effects of brands’ transparent communication (i.e. production transparency and cost transparency) on consumers’ perceptions of a brand’s perceived transparency and authenticity, as well as how such perceptions impact consumers’ attitude, trust and behavioral intentions. Design/methodology/approach Two between-participants factorial design experiments ( n = 176 for Study 1 and n = 169 for Study 2) were conducted to examine consumers’ responses to a brand’s cost transparency and production transparency. Findings The results revealed that transparency in the focal brand’s communication of production and cost would increase consumers’ perceptions of the brand’s transparency and authenticity because of its perceived information sensitivity. Such positive effects were found to similarly impact consumers’ attitude, trust and behavioral intention toward the brand. Practical implications The results point to the importance of brand transparency in marketing communication, specifically as it pertains to the influence that the inclusion of transparent cost and production information can have on consumers’ perceptions of authenticity, trust and attitude, as well as how these perceptions translate into behavioral intention. Originality/value To the best of the authors’ knowledge, this study is among the first to explore the differences between production transparency and cost transparency in influencing consumer responses and the underlying mechanisms. The findings also expand to the literature on brand transparency and brand authenticity.