The Effect of AI-generated Video Advertisement towards Customer Loyalty on McDonald in Malaysia

Low, Kha Wai (2025) The Effect of AI-generated Video Advertisement towards Customer Loyalty on McDonald in Malaysia. Masters thesis, Tunku Abdul Rahman University of Management and Technology.

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Abstract

The rise of Artificial Intelligence (AI) in marketing has introduced new ways of creating advertisements, particularly through AI-generated video ads. However, despite the increasing use of this technology, there is uncertainty about whether AIgenerated advertisements can truly foster customer loyalty. Concerns around emotional disconnect and authenticity have emerged as key challenges. This study aims to examine the impact of AI-generated video advertisements on customer loyalty, focusing specifically on McDonald's customers in Malaysia. Data was collected through an online survey of 388 respondents and analysed using SPSS and SmartPLS software. The mediation analysis revealed that affective satisfaction significantly mediates the relationships between image appeal, social presence, interactivity, and accessibility with brand loyalty, while cognitive satisfaction significantly mediates the relationships between argument quality, message source credibility, image appeal, interactivity, and accessibility with brand loyalty; however, cognitive satisfaction did not mediate the relationship between social presence and brand loyalty. The study concludes that AI advertisements, if designed carefully to balance emotional engagement and information clarity, have strong potential to enhance brand loyalty. However, brands must address the risks associated with losing human touch and ensure trust remains central to their messaging strategies. This research provides important insights for marketers seeking to optimize AIdriven campaigns while maintaining authentic connections with consumers. Keywords: digital marketing, McDonald's Malaysia, elaboration likelihood model, emotional and cognitive satisfaction, brand loyalty, and AI-generated advertising.