Abstract:
In today’s dynamic and competitive market environment, consumer behaviour is
rapidly evolving, requiring brands to adopt innovative advertising strategies to
sustain long-term relationships. Hence, this study investigates the impact of ambient
advertising on brand loyalty in Sri Lanka’s food and beverage industry, with
particular emphasis on the mediating role of customer engagement. The objectives of
the study are to examine the influence of creativity, unexpectedness, and novelty in
ambient advertising on brand loyalty, while assessing the mediating effect of
customer engagement. The study tested four hypotheses. H1–H3 proposed that
creativity, unexpectedness, and novelty in ambient advertising positively influence
brand loyalty, and H4 proposed that customer engagement mediates this relationship.
A quantitative, cross-sectional design was adopted, and data were collected from 384
respondents representing diverse demographic profiles. A purposive sampling
method was employed to ensure participants were exposed to ambient advertising. A
structured, validated questionnaire was used, and reliability and validity were
confirmed through Cronbach’s alpha and factor analysis. Data were analysed using
correlation, multiple regression, and mediation analysis in SPSS. The results reveal
that all three dimensions of ambient advertising significantly and positively affect
brand loyalty. Moreover, customer engagement partially mediates these
relationships, confirming H1–H4 and rejecting alternative null hypotheses. These
findings underscore that ambient advertising enhances brand loyalty directly and
indirectly by fostering deeper engagement. The study makes both theoretical and
practical contributions. Theoretically, it extends existing knowledge by empirically
validating the mediating role of customer engagement in an emerging market context.
Practically, it provides actionable insights for marketers in the food and beverage
industry, highlighting the importance of designing creative, surprising, and novel
campaigns that stimulate customer engagement and build stronger brand loyalty.
Therefore, strategically leveraging ambient advertising, brands can strengthen loyalty
and achieve sustainable competitive advantage in cluttered markets.
