From signals to cost inference: The role of perceived signal cost in entrepreneurial athlete branding

Entrepreneurial athlete branding – including co-investment partnerships and athlete-owned ventures – has become increasingly common on social media, yet little is known about how consumers interpret these emerging branding arrangements. Drawing on signaling theory, this study examines how consumers infer signal cost from different athlete branding arrangements and how these inferences shape purchase intentions. A U.S.-based online experiment (N = 367) demonstrates that co-investment and self-branding are perceived as involving greater athlete investment than third-party endorsements and that perceived signal cost mediates the relationship between branding type and purchase intention. Furthermore, parasocial relationships exert the strongest influence when branding signals provide less visible commitment cues, whereas their influence diminishes as branding signals become more diagnostic of personal investment. This study advances signaling theory by directly testing the signal-cost-response pathway and identifying receiver conditions that shape cost inference in athlete branding while offering practical insights into how athletes and brands can structure commercial partnerships to enhance consumer responses.