The digitization of news publishing has resulted in new ways for advertisers to reach readers, including additional native advertising formats that blend in with news. However, native ads may redirect attention off-site and affect the readers' impression of the publishers. Using a combination of observations of ad content across many publishers and two large randomized experiments, we investigate the characteristics of a pervasive native ad format and compare the impact of different native ads characteristics on perceived news credibility. Analyzing 1.4 million collected ad headlines, we found that over 80% of these ad headlines use a clickbait-style and that politics is among the most common topics in ads. In two randomized experiments (combined n=9,807), we varied the style and content of native ads embedded in news articles and asked people to assess the articles’ credibility. Experiment 1 (n=4,767) suggested that different publishers were impacted differently by the ads and motivated the more detailed design of Experiment 2 (n=5,040). This latter experiment used hundreds of unique combinations of ads, articles, and publishers to study effects of clickbait and political ads. Findings from this pre-registered experiment provide evidence that clickbait and, to a lesser extent, political ads, substantially reduce readers' perception of the articles' credibility. This phenomenon is driven by the least well-known publishers and by readers' prior familiarity with those publishers. Importantly, we rule out large effects of non-clickbait ads, compared with no ads, on readers' attitudes. Many publishers using clickbait native ads may trade short-term revenues for audience trust.
In-store shopping is a recurring behavior often happening in a stable context, making it very likely for the formation of habits. Relying on heuristics and habits can help consumers free up their mental resources for more important deliberative tasks. This is broadly consistent with the finding that consumers' choices exhibit state dependence. However, much prior work has simply distinguished all state dependence from other sources of correlated choices (e.g., latent consumer heterogeneity), thus leaving open the question of whether some of this state dependence should be attributed to habits. Here, using panel data on households' purchases across many product categories, we use store closures as a shock that partially disrupts households' shopping behavior to identify the role of formed shopping habits in repeated brand purchases. Closures force people to visit new stores to purchase products in categories they previously bought at the closed store, where we posit they are more likely to engage in deliberative decision-making processes --- driving them to explore some options that are normally ignored in a familiar store because of learned habits. Following a store closing at which they frequently purchased products in a given category, households are more likely to purchase something other than their modal brand in that product category. This effect remains after accounting for the reduced availability of their modal brand. Over time, households return to higher levels of purchasing their modal brand, consistent with the formation of new habits. However, we find that the temporarily increased deviation from their prior modal brand due to store closures results in a lasting impact on households' brand choices, leading them to permanently lower rates of purchasing their baseline modal brands. This illustrates how habit formation, while advantageous for consumers in other ways, can lead to non-optimal choices.
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