Background: The increasing presence of advertising clutter and ad fatigue in digital environments has encouraged firms to adopt alternative advertising formats that appear more authentic and less disruptive than traditional advertising. One increasingly endorsed approach is user-generated content advertising, where brands incorporate consumer-made content into their marketing communication strategies. Although previous research has shown positive effects of UGC, limited attention has been given to UGC used specifically as advertising, particularly in comparison to traditional advertising across different product categories.

Purpose: The purpose of this study is to examine the effectiveness of UGC advertising compared to traditional advertising in influencing consumer engagement and purchase intention, and to determine whether these effects differ between search and experience products.

Method: The study adopted a quantitative explanatory research design using a 2x2 between-subjects experiment. The independent variables consisted of advertising type, UGC versus traditional advertising, and product type, search versus experience products. Data were collected through an online survey with female respondents who were randomly assigned to one of four experimental conditions. The dependent variables were cognitive engagement, emotional engagement, behavioural engagement, and purchase intention. The data were analysed using descriptive statistics, reliability analyses, correlation analysis, ANOVA analyses, regression analyses, and mediator analysis.

Conclusion: The findings show that UGC advertisements generate significantly higher consumer responses across all dependent variables and product categories, compared to traditional advertising. The results demonstrate that the positive effects of UGC advertising are significantly stronger for experience products than for search products, indicating that product type moderates the relationship between advertisement type and consumer response. Overall, the findings contribute to a more nuanced and context-sensitive understanding of UGC advertising effectiveness. Furthermore, consumer engagement acts as a mediator for purchase intention, whereas explanatory perceptions predict UGC effectiveness.