Transparency matters

This study examines how sponsorship disclosure format and influencer compensation nature shape perceived sponsorship transparency and its effects on source credibility, information credibility, online engagement, and purchase intention among Instagram micro-influencers. Drawing on the Persuasion Knowledge Model, Communication Transparency Theory, Parasocial Interaction Theory, and Source Credibility Theory, the study conceptualizes perceived sponsorship transparency as consumers’ holistic judgment of how openly the commercial relationship is communicated. A between-subjects experiment (420 participants) was analyzed using two-way analysis of variance, regression, and serial mediation. Disclosure format, but not compensation nature, influenced perceived transparency, with platform-integrated disclosures outperforming hashtag-based ones, extending the Persuasion Knowledge Model to platform-governed ecosystems. Transparency sequentially mediated behavioral outcomes through source and information credibility, with source credibility the stronger mediator. Limitations include snowball sampling, a fictitious influencer and brand, and no confirmatory factor analysis.