CAN ARTIFICIAL INTELLIGENCE SELL GREEN? BRAND TRUST AND CONSUMER RESPONSES TO AI-GENERATED ADVERTISING

Abstract

The growing use of artificial intelligence (AI) in digital advertising is transforming how brands communicate environmental value, but it also raises questions about whether consumers trust green claims generated through AI. This study investigates whether AI-generated green advertising can effectively communicate environmental value and translate such communication into favourable consumer responses in the emerging bio-cosmetic market. A stimulus-based online survey of Generation Z consumers in Pakistan (N = 374) was conducted, who evaluated an AI-generated Instagram-style advertisement for a fictional bio-cosmetic brand before completing the questionnaire. The findings show that AI-generated green advertising strengthens green brand trust, which subsequently translates into stronger bio-cosmetic purchase intention and greater willingness to pay a premium. Green brand trust serves as the central pathway through which AI-generated green advertising drives consumer outcomes; however, this process is conditional: higher AI skepticism weakens the positive relationship between AI-generated green advertising and green brand trust. The study extends signaling theory to AI-enabled green advertising by integrating the environmental signal, trust-based mechanism, behavioural and economic outcomes, and a receiver-level boundary condition within a single framework. For managers, the findings suggest that AI-generated green advertising should be built around specific and credible environmental claims that strengthen green brand trust, while transparent evidence supporting those claims can help convert consumer trust into more favourable marketplace responses.