This chapter explores the evolving landscape of influencer marketing with the advance of virtual influencers—AI-powered, computer-generated characters designed to emulate human influencers. As traditional advertising faces growing consumer skepticism, social media influencers have emerged as compelling alternatives, with electronic word-of-mouth (e-WOM) playing a central role in shaping consumer behavior. Recently, virtual influencers have garnered attention for their ability to engage audiences, offering brands unprecedented control and consistency in their messaging. However, concerns around their authenticity, credibility, and ethical use remain prevalent. Drawing on empirical research, this chapter investigates how virtual influencers are perceived by social media users, with a specific focus on parasocial interactions and source credibility. Using in-depth interviews analyzed through thematic analysis, the study identifies key factors that make virtual influencers persuasive, including physical and social similarity to the target audience, engaging content, and interactive behaviors. While respondents acknowledge their appeal—especially in contexts such as technology promotion—virtual influencers are seen as less credible than human influencers when promoting products they cannot physically use. Nonetheless, credibility can be enhanced through third-party validation and relevant, high-quality content. The findings highlight that while virtual influencers hold promise, their persuasive power is highly context-dependent and currently falls short of human influencers in terms of perceived authenticity and trustworthiness. The chapter concludes by emphasizing the potential for virtual influencers to gain traction as technology improves and audience expectations evolve.