Should a luxury Brand's Chatbot use emoticons? Impact on brand status

Abstract Luxury brands are increasingly adopting chatbots for online customer service. But, little is known about the role of adding design features such as emoticons on customers' luxury experience. This study fills this research gap by exploring the influence of a luxury brand chatbot's adoption of emoticons on status perception and its underlying mechanisms. Results from two experiments suggest that luxury brands might be better off not using emoticons in chatbot communications because it dampens the brand status perception due to perceived unexpectedness, which in turn decreases the perception of the appropriateness of the interaction with chatbots. However, this negative effect of luxury brand's use of emoticons in chatbot communication only exists for traditional luxury brands, not for masstige brands. This study advances the literature on AI, particularly regarding luxury brand‐specific chatbot applications. It also offers insights for luxury brand managers that they should be cautious in adopting emoticons in chatbot communication given the risk of ruining the brand status, especially when the brand is a traditional luxury brand as opposed to a masstige brand.