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A

RESEARCH PROJECT REPORTON

Impact of Celebrity Endorsement for Social Causes

Submitted in partial fulfillment for the award of the DegreeMASTER ON BUSINESS ADMINISTRATION

(2011- 2013)

Submitted To: Submitted By:Dr. J.N. Giri Swmdwn Daimari(Faculty of MIMT) Roll No. 1115270131

M.B.A. 4 th Sem.

Mangalmay Institute of Management and TechnologyGREATER NOIDA


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Declaration

This is to certify that the project report titled IMPACT OF

CELEBRITY ENDORSEMENT FOR SOCIAL CAUSES

carried out by Swmdwn Daimari , has been accomplished

under my guidance & supervision as a duly registered MBA

student of MANGALMAY INSTITUTE OF MANAGEMENT &

TECHNOLOGY. This project is being submitted by him in the

partial fulfillment of the requirements for the award of the

Master of Business Administration from MIMT COLLEGE. His

dissertation represents his original work and is worthy of

consideration for the award of the degree of Master of

Business Administration.

Swmdwn DaimariMBA 4 th sem

Roll No.:1115270131

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ACKNOWLEDGEMENT

I express my sincere gratitude to my faculty guide Dr. J. N. Giri of myinstitute for his able guidance, continuous support and cooperation

throughout my project, without which the present work would not have been

possible.

Swmdwn Daimari

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TABLE OF CONTENTS

CHAPTER SUBJECT PAGE NO.

Ch.# 1.0 Introduction.. 7

Ch.# 2.0 Research Methodology. 10

2.1 Primary Objective. 11

2.2 Hypothesis 12

2.3 Research Design.. 12

2.4 Sample Design. 13

2.5 Scope of the Study.. 14

2.6 Limitations 14

Ch.# 3.0 Critical Review of Literature. 15

3.1 Communication Theories.. 16

3.2 Models in Celebrities Endorsement 21

Ch.# 4.0 Brand, Celebrity and Consumer 29

4.1Brand. 31

4.2 Celebrity... 32

4.3 Celebrity Endorsement.. 33

4.4 Celebrity and Brand. 34

4.5 Understanding Consumer Behavior. 34

Ch.# 5.0 The Advantages and Disadvantages of

using Celebrities as endorsers 39

Ch.# 6.0 Celebrity Endorsement- An Indian Perspective 47

Ch.# 7.0 Findings and Analysis 51

Ch.# 8.0 Suggestions. 60

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Conclusion 63

Ch.# 9.0 Bibliography and References 67

Annexure. 70

Ch.# 10.0 Case Study 74

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ABSTRACT

The use of celebrities endorsing brands has been steadily increasing over the

past 20 years or so. Marketers visibly acknowledge the power of celebrity in

influencing buyer's purchase decision and thereby extending the market

share of the company. They believe that likeability or a favorable attitude

towards a brand is created by the use of a celebrity. Different kinds of

celebrities are used for endorsement purpose, but two of the most common

types are entertainers and sports persons.

The purpose of this study is to understand the kind of impact these

endorsements have on consumers and there by on the brands. In order to

achieve this purpose three research questions have been considered:

Why and when do brands use celebrities as endorsers? What are the risks

involved in celebrity endorsements? What impact does celebrity

endorsements have on consumer behavior?

Research uses primary source of data. The research tools applied for the

analysis of data were mainly statistical tools. The scope of the research is

limited to the responses of 100 people living in Delhi NCR region. On the

basis of analysis and the interpretations of the results obtained certain

recommendations and conclusions have been derived from the research.

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The main limitation of this research is that the scope of this research is

limited to the response of 100 people who will be filling the questionnaire

and thus cannot be generalized for the whole population.

CHAPTER-1.0INTRODUCTION

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1.0 INTRODUCTION

It is a known fact that the best endorsements achieve an eclectic balance

between the product (brand) and the celebrity. Giving a brand a 'face' is

more than just a marketing strategy to increase sales or gain market share, it

is a decision that can change the future of the brand forever.

Choice of the celebrity, hence, is of utmost importance and is usually done

based on many different parameters - appeal, looks, popularity or even just a

fantasy figure to endorse a brand.

In today's highly competitive markets, big brands are at logger-heads when it

comes to products, each having a similar product to that of a rival. Where

does one brand gain that quintessential advantage - advertising, service, promise of trust, or even the all important price factors? Advertising seems

to be the best platform where brands prefer to compete on - right from hiring

the best advertising agencies to getting the biggest celebrities.

The general belief among advertisers is that brand communication messages

delivered by celebrities and famous personalities generate a higher appeal,

attention and recall than those executed by non-celebrities. The quick

message-reach and impact are all too essential in today's highly competitive

environment.

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India is a country where people are star-struck by film stars, cricketers,

politicians, and even criminals. Why? Populations of 1 billion and ticking,

everyday people need something or someone to look up to. A sense of

security, admiration, comfort, familiarity, and above all, someone theyaspire to be at some hidden level in their lives. And clever marketers

leverage this very celebrity appeal and are successfully carrying out their

jobs by giving the bottom lines of all the brands what they want - profit,

market share and even recall.

Now, despite the potential benefits derived from celebrity endorsements,

they increase a marketer's risk manifolds and should be treated with full

attention and aptitude. A brand should be cautious when employing

celebrities to ensure promise believability and delivery of the intended

effect. The growing importance of mythical characters as celebrities and

their sway over the target segments are ample proof of public demand for

icons to look up to. As the celebrities traverse from a mere commercial

presence to public welfare message endorsements, a whole new dimension isadded to this process and helps us in achieving a holistic view of the impact

which celebrities generate in every sphere and segment through their well-

versed endorsements.

At the end of the day, the questions that need to be answered are: does a

company benefit from a celebrity endorsement? Does anyone buy a product

because a Bollywood or TV actor/actress stands up and reads a script in

somewhat convincing manner? Are their distinctions in how consumers

perceive these types of endorsements and respond to them? What happens

when a celebrity endorser gets involved in a public scandal, or worse, dies?

Will the product lose consumer support or perish?

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CHAPTER-2.0

RESEARCH METHODOLOGY

2.1 PRIMARY OBJECTIVE

2.2 HYPOTHESIS

2.3 RESEARCH DESIGN

2.4 SAMPLE DESIGN

2.5 SCOPE OF THE STUDY

2.6 LIMITATIONS

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2.0 RESEARCH METHODOLOGY

Research Methodology is the analysis of the principles of methods, rules,

and postulates employed by a discipline, the development of methods, to be

applied within a discipline and a particular procedure or set of procedures. It

is the maneuver of doing research of particular problem. This includes type

of research, sampling method and data collection sources etc.

2.1 PRIMARY OBJECTIVE

The primary objective of this research is to analyze the effect of Celebrity

Endorsement on Consumer Behaviour.

SECONDARY OBJECTIVE

The secondary objectives of this research are as follows:

1. To examine why does the brand uses the celebrities as endorsers

2. To find out when does the brand uses the celebrities as endorsers

3. To find what are the various risk involved in using celebrities as

endorsers

4. To examine whether Celebrity endorsement leads to brand

enhancement or not

5. To find whether consumer focuses on their needs and cost factor or

gets carried away by brands enhanced by the famous people

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6. To find the motivating factors that affects the buying decision of a

consumer?

2.2 HYPOTHESIS(H0)1 = Celebrity Endorsement does cast an impact on consumer

buying behaviour through advertisements.

(H1)1 = Celebrity Endorsement does not cast an impact on consumer

buying behaviour through advertisements.

2.3 RESEARCH DESIGN

A research design is the plan, structure and strategy of investigation

conceived so as to obtain to research problem and control variances. It is the

specification of methods and procedures for acquiring the information

needed. It is overall operational pattern or framework of the project that

stipulated what information is to be collected and from which source and by

what procedure.

Research design provides the glue that holds the research project together. A

design is used to structure the research, to show how all of the major parts of

the research project -- the samples or groups, measures, treatments or

programs, and methods of assignment -- work together to try to address the

central research questions.

Type of research design- DESCRIPTIVE

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The research is descriptive in nature. In this project report, firstly primary

data was collected regarding how a celebrity can help a consumer in

identification of a product. A questionnaire was then drafted for the same, to

understand the psyche of the customers to know their needs, expectationsand their attitude, their liking and disliking and their views and comments

about Celebrity Endorsement and towards the brand that they see on various

media mode.

On the basis of analysis of the result collected from the survey, certain

conclusions have been derived, which are clearly mentioned in detail in the

later part of this project report.

2.4 SAMPLE DESIGN

Sample design is about choosing how many elements (businesses, people

etc) to include in a survey in order to provide a good basis for measuring

economic and social phenomena. Estimation is about producing aggregate

information from data collection in samples. It includes calculating quality

measures based on sampling (sampling errors).

The procedure by which a few subjects are chosen from the universe to be

studied in such as way that the sample can be used to estimate the same

characteristics in the total is referred to as sampling.

The data collected is in the form of a questionnaire as primary data andcertain studies which have already been conducted are also considered

which will be used as secondary data.

Type of sample design- CONVEYNCE

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The research is to be based on non probability sampling technique which

attempts to obtain a sample of convenience element. The survey conducted

involves a sample of 100 elements.2.5 SCOPE OF THE STUDY

The research conducted attempts to find out the effect of celebrity

endorsement on consumer buying decision. In order to achieve this purpose

a survey has been conducted which include 100 elements from Delhi NCR

region.

Thus the scope of the study is limited to the response of 100 elements only.

2.6 LIMITATIONS

Research project are hindered in their smooth flow by some unforeseen

problems. The problems arise in the form of constraints with time and scope

of study. Some of the limitations in the course of research are as follows-

Sampling error- the research included a small sample size, which can

not determine the characteristics of the total population.

Limited time- since we are restricted to just four months to cover the

work, which is less to undergo the entire study.

At times the information given by the respondents were found to be

contradicting in nature.

Also, sometimes the respondents were reluctant to give their time in

order to fill the questionnaire.

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CHAPTER-3.0

CRITICAL REVIEW OF LITERATURE

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3.1 COMMUNICATION THEORIES:

3.1.1 The one step communication model3.1.2 The two step flow model3.1.3 Elements of communication

3.2 MODELS IN CELEBRITY ENDORSEMENT

3.2.1 Source Credibility Model3.2.2 Source Attractiveness Model3.2.3 Product Match-up Model3.2.4 Meaning Transfer Model

When researchers first began to study mass communication, they thought

that media was all-powerful. They developed the ONE STEP FLOW also

called the HYPODERMIC NEEDLE MODEL. In this model, media is seen

as a powerful hypodermic needle that injects information directly into the

mind of the masses, which are eager to receive it. This way the masses

would know what they were told to know and do what they were told to do

through the power of mass communication.

MEDIA

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The "hypodermic needle theory" implied mass media had a direct,

immediate and powerful effect on their audiences. In the 1940s and 1950s

mass media were perceived as a powerful influence on behavior change.

Several factors contributed to this "strong effects" theory of communication,

including: the fast rise and popularization of radio and television, and the

emergence of the persuasion industries, such as advertising and propaganda.

3.1.2 THE TWO STEP FLOW MODEL

By the year 1940, researchers realized that there was more to simple mass

communication cause and effect model. They became aware that while

people do get some of their information from the media directly, it wasnt

the media alone that made them act.

While the mass communication does have some effect, the strongest

influence comes from the interpersonal communication, especially from the people which the researchers called opinion leaders.

An opinion leader as a peer to whom others turn for information and

influences the opinion of others. Opinion leaders gather the information

from the media and other resources, synthesize it, think about it and pass it

on to others.

This was shown in the TWO STEP FLOW MODEL developed by KATZ

and LAZARFELD in 1955. This model shows information flowing from the

media to opinion leaders and from them to the masses.

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The above model shows

that the information

does not flow directly from the text into the minds of its audience

unmediated but is filtered through "opinion leaders" who then communicateit to their less active associates, over whom they have influence. The

audience then mediates the information received directly from the media

with the ideas and thoughts expressed by the opinion leaders, thus being

influenced not by a direct process, but by a two step flow.

The idea of opinion leader became very important, especially for

professional communicators who were trying to influence the opinions and

actions of large number of people. There are two types of opinion leaders:

Formal opinion leaders are people whose opinion is valued because

they hold an important office or position for example film stars, sports

celebrities, politician etc

Informal opinion leaders are people who just have a strong influence

on the opinions of their peers.

When a celebrity endorses a product through a mass medium, the form of

communication is considered to be interpersonal as he or she seems to

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influencing the customer directly into purchasing a product by giving his or

her opinion about it. Since people relate to such celebrities and are deeply

impacted by their endorsements, these celebrities can easily be categorized

as opinion leaders. Therefore there are cases where people get lured into buying a product without knowing its true characteristics.

3.1.3 THE COMMUNICATION PROCESS AND ITS ELEMENTS:

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The above diagram represents the actual communication process. As can be

seen there eight elements to any communication process. They are explained

below:

SENDER: The sender is the source from where the information

originates. There can be many people involved in originating the

information; it can range from 1-2 individuals to a large organization

depending upon the type of communication process involved

ENCODING: The message so generated by the sender has to be

passed to the receiver. The process of putting thought into symbolic

form is called as encoding. MESSAGE: The message is the actual idea which the sender wants to

transmit to the receiver. The message can be verbal or non verbal. It

should be such that it is easily understandable and transmittable

through the channel of communication being used.

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CHANNEL: A channel is the medium through which the message is

send by the sender to the receiver. The channel used can be audio,

visual or audio visual medium. The channel used should be in

accordance to the message. DECODING: The message so sent by the sender has to be transferred

into a form which is easily understandable by the receiver. The

decoding of the message greatly depends upon the social environment

RECEIVER: The receiver is the person/persons to whom the message

is directed at. In mass communication receivers are large in number

and thus are self directed. RESPONSE and FEEDBACK: Response is a set of reactions that the

receiver has after being exposed to the message.

Feedback is an important part of the communication process, as

without it the sender would not be able to make out if the receiver has

been able to interpret the message in the way it was intended. And on

this basis sender modifies his/her message. NOISE: Noise is the unplanned hindrances in the way of the

communication process due to which receiver receives a different

message then that send by the sender. Noises can be of three kinds:

semantic, environmental and mechanical.

3.2 MODELS IN CELEBRITY ENDORSEMENTS

Whilst there is a growing interest in the literature regarding celebrity

endorsement, most of the work can be classified into the following four

theory areas. These include Source Credibility Model, Source

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Attractiveness Model, Match up Proposition and Meaning Transfer

Model.

3.2.1 SOURCE CREDIBILITY MODEL

Source Credibility in a broad sense, refers to a communicators positive

characteristics that affect the receivers acceptance of a message (Ohanian

1990, p. 41) and rests on the research in social psychology. The Source

Credibility Model is generally considered to have two main dimensions;

namely Trustworthiness (the audience's degree of confidence in and

degree of acceptance of the speaker and the message) and expertness (the

extent to which a communicator is perceived to be a source of valid

assertions). This model suggests that the effectiveness of a message depends

upon how the consumers perceive the endorser (Hovland et al. 1953).

Previous research established a link between expertise and persuasiveness.

An expert celebrity tends to be more persuasive and generates a higher

willingness to buy the brand by consumers. Furthermore, research has also

demonstrated the positive effect of trustworthiness on attitude change. In a

research study McGinnies and Ward (1980) found that an expert a

trustworthy source generated the strongest opinion change by consumers and

the trustworthy communicator was persuasive whether an expert or not

(Ohanian 1990). Till and Busler (2000) found the expertise dimension to bemore important than physical attraction as a match-up factor. Kamins, et al.

(1989) indirectly supported source credibility model. In their study,

enhanced credibility and effectiveness was reflected in overall higher ratings

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on perceived quality of service and respondents also revealed greater

purchase intentions.

It should be noted that it is often difficult to define source credibility in

exact terms. This is because of different operationalisations and use of different labels and terminology such as ethos, prestige, reputation, authority

and competence by different researchers and authors (Ohanian 1990 p. 41).

Ohanians (1990) study is considered to be a key research paper in the area

of celebrity endorsement. Her three factors fifteen-item credibility scale has

been widely accepted and replicated by other researchers. Using two

exploratory and two confirmatory samples, Ohanian (1990) developed a

fifteen-item semantic differential scale to measure perceived expertise,

trustworthiness and attractiveness. Four celebrities and four products were

selected and to purify and validate the scale. The whole study was divided in

two stages.

In the exploratory stage, after assessing the level of familiarity (with

Madonna and John McEnroe), respondents were asked to evaluate 72

semantic differential items. These were reduced to 27 items representing

three dimensions (expertise, trustworthiness and attractiveness) by factor

analysis. Finally, in order to obtain a practical size of five items per factor,

the items with the lowest item-to-total correlations were eliminated while

maintaining an acceptable level of reliability. In the confirmatory analysis,

five items per subscale (total of 15 items) along with some other validationitems were used to assess the final scales reliability and validity. Two adult

samples (138 and 127) and two different celebrities (Linda Evans and Tom

Selleck) were used to support the generalizability of the scale. Following

table represents the final three dimensions source credibility scale.

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Source: Construction and Validation of a Scale to Measure Celebrity

Endorsers Perceived Expertise, Trustworthiness, and Attractiveness;

Ohanian (1990).

Table 2.1 Source-Credibility Scale

3.2.2 SOURCE ATTRACTIVENESS MODEL

Source Attractiveness Model; considered to be a component of the source

valance model (McGuire 1985) and draws on the research in social

psychology. The source attractiveness model is mainly based on four

dimensions; namely familiarity (knowledge of source through exposure),likeability (affection for source based on his/her physical appearance or

behaviour), similarity (resemblance between the source and the audience),

and attractiveness. It suggests that effectiveness of the message depends

on these four dimensions. Sources that are familiar, likeable and/or similar to

the consumers are attractive and to this extent persuasive (Ohanian 1990).

Empirical findings posit that physical attractiveness is one of the key factors

in an individuals initial judgment of another individual as well as

influencing attitude change

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(Baker and Churchill 1977; Caballero and Pride 1984; Chaiken 1979; Joseph

1982; Mills and Aronson 1965). Attractive models led to more favorable

attitudes toward the advertisement and stronger purchase intentions.

Physical attractiveness of the celebrity endorser was found to influencesubject recall, product attitudes and purchase intention to a greater extent

than endorser likeability or level of product involvement (Kahle and Homer

1985).

3.2.3 PRODUCT MATCH-UP MODEL

The Celebrity-Product Match proposition holds that in order to make an

advertisement effective, there should be congruence between the product

and the celebrity in terms of characteristics such as image, expertise or

attractiveness. The Match-up model states that attractive endorsers are more

effective when promoting products used to enhance ones attractiveness

(Kamins 1990) and that the impact will not be significant in the case of an

attractiveness unrelated product. Findings for the research studies conducted

by Baker and Churchill (1977), Friedman and Friedman (1979), Joseph

(1982) and Kahle and Homer (1985) demonstrated consistent results.

Kahle and Homer (1985) found that in the case of attractiveness related

products, the use of physical attractive celebrities increased subject recall,

product attitudes, and purchase intention. However, they did not demonstrate

that an attractive celebrity is less effective when endorsing a product notused to enhance ones attractiveness, such as home computers. Kamins

(1990) set up a full test of the match-up proposition. He paired attractive and

unattractive celebrities with either attractiveness related or unrelated

products. He paired a celebrity with a product and found interaction effect

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between attractiveness and product type. Predicted interaction was found for

spokesperson credibility and attitude toward the advertisement but not

for brand attitude or purchase intention. Erdogan et al. (2001)

investigated practitioners perspective and found that while selectingcelebrity endorsers, managers considered a number of factors. Consistent to

meaning transfer model (McCracken 1989), managers view the celebrity as a

multidimensional personality with a bundle of meanings. Moreover, the

study demonstrated that there should be a proper fit between celebrity

characteristics and product types. Implicitly, they supported the product-

match up proposition. Agencies considered congruence, credibility,

profession, popularity, and obtainability issues to be more important while

deciding upon a celebrity. They also rated trustworthiness and expertise

more important in the case of technical/attractiveness-unrelated product

(Erdogan et al. 2001). On the other hand, they indicated that celebritys

physical attractiveness, familiarity and likeability were more important for a

non-technical or attractiveness-related product.

Till and Busler (1998, 2000) examined attractiveness versus expertise as a

relevant match-up factor and found a general attractiveness effect on brand

attitude and purchase intent but no match-up effect was found based on

attractiveness. Based on their findings, Till and Busler proposed that though

attractiveness is important, expertise is more appropriate for matching

products with a celebrity endorser.

3.2.4 MEANING TRANSFER MODEL

McCracken (1989) addressed the endorsement process from a cultural

perspective. He argued that the endorsement process depends upon the

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symbolic properties of the celebrity endorser and the celebrity served the

endorsement process by taking on the meanings that then carry from

advertisement to advertisement. McCracken has described the Celebrity

Endorsement process as a special instance of a more general meaningtransfer (McCracken 1986; McCracken 1989). In the model, cultural

meanings move through a conventional path to individual consumers.

Meanings begin as something inherent and resident in the culturally

constituted, physical, and social world. Meanings move from culturally

constituted world to consumer goods through advertising and fashion

systems and than it is transferred to individual consumer through the efforts

of the consumer. Thus, meaning keeps on circulating in the consumer

society (McCracken 1986; McCracken 1989).

McCracken (1989)s meaning transfer theory has direct implications for the

celebrity endorsement process. He argues that for the purpose of

communication, a celebrity has a set of fictional roles and when consumers

respond to celebritys specific characteristic, they are in fact responding to a

very particular set of meanings. A celebrity is a persuasive communicator

not only because of being attractive or credible but also because he/she has

made up certain meanings the consumer finds compelling and useful. The

effectiveness of the endorser depends upon the meanings he or she brings to

the endorsement process.

McCracken has described the whole Meaning Transfer Process in three

stages. As shown in figure in the initial stage, the meanings generated from

distant movie performances, political campaigns, or athletic achievements

and performance, reside in celebrities themselves. In the second stage,

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meanings are transferred to the product through advertisement and the

endorsement process. In the third stage the meanings are transferred from

the product to the consumer where the properties of the product become the

properties of the consumer (McCracken 1989).

3.3 CELEBRITY ENDORSEMENT STRATEGY

Marketers generally use individuals who have achieved some form of

celebrity status for their companies to serve as spokespersons. Most of the

people that are hired by any company to pitch their products or services are

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popular people that can be movie stars, entertainers, athletics, or pop-stars,

and occasionally a politician or some other well-known public figure may be

used (Belch & Belch, 2001). Further, when a company decides upon using

an endorsement strategy for their marketing communication tool, the mainfocus lies in exposing their brand (Kotler, Armstrong, Saunders, & Wong,

2001).In an endorsement strategy a new sort of product is given a new brand

name that is unique for that product (Riezebos, 2003).along with the unique

brand name, companies also get provided with the name of an endorser. In

such case, the endorser is a celebrity and function is endorsement which

means an approval or support that can be seen as a guarantee or

recommendation to the consumers. According to Riezebos (2003) it is only

advisable to use endorsers for brands if there is a high level of brand-added

value. This means that the name of the endorser should be clearly visible

next to the name of the branded article.

Companies have jointly been using their brands and their own name, through

the use of celebrity endorsers, in a hope that celebrities might boost

effectiveness of their marketing attempts in the long-term (Belch & Belch,

2001).Basically, a company is trying to send various types of information to

their target audience.

In order to be able to develop an effective advertising and promotional

campaign, a company has to select their endorser who are appropriate todifferent channels and media (Till & Shimp, 1998),such as source, message,

and receiver (Belch & Belch, 2001).Thus, the brand can be seen as the

message the company is trying to send to their audience. Moreover, the

source which is intended to send this message in an endorsement strategy

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becomes the celebrity and the receiver in the communication process

becomes the consumer (Belch & Belch, 2001)

CHAPTER-4.0

BRAND, CELEBRITY ANDCONSUMER

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4.1 BRAND4.2 CELEBRITY4.3 CELEBRITY ENDORSEMENT

4.3.1 Types of Celebrity Endorsements4.4 CELEBRITY AND BRAND

4.4.1 Celebrity Brand Compatibility4.5 UNDERSTANDING CONSUMER BEHAVIOUR

4.5.1 Consumer Decision Making Process

4.5.2 Impact of Brand on Consumer DecisionMaking Process

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4.0 BRAND, CELEBRITY AND CONSUMER

4.1 BRAND:

Brand is the proprietary visual, emotional, rational and cultural image that a

consumer associates with a company or the product. Few examples to clarify

its meaning are Amu l - utterly butterly delicious; Coke thanda matlab

coca-cola; Pepsi Yeh dil mange more; Kurkure- Masti bole to kurkure.

The above examples convey one message that when people watch these

advertisements a connection is created which results in people wanting to go

for the experience of buying. People feel that by using the brand, they will

receive certain traits or characteristics that they otherwise do not have, thus

generating sense of fulfillment.

Advertisements enforce what exactly the brand stands for and what to expect

by its consumption and also what all factors, features and attributes makes it

better and different from its competition. Advertisements force people to

think about what they see or hear. This gets enhanced when a celebrity

endorses the brand. The subjective intangible feelings of a customer become

objective and tangible in the form of celebrity and the level of expectations

rises.

4.2 CELEBRITY:

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Celebrities are people who enjoy public recognition and are the experts of

their respective fields having wider influence in public life and societal

domain. Attributes like attractiveness, extraordinary life style or special

skills , larger than life image and demigod status can be associated withthem.

Celebrities appear in public in different ways. They appear in public when

fulfilling their professional commitments or they appear in public by

attending special celebrity events. Celebrities have universal presence and

appeal, and are present everywhere, in news, fashion shows and magazines,

tabloids and above all advertisements.

4.3 CELEBRITY ENDORSEMENT:

McCracken's (1989) definition of a celebrity endorser is, "any individual

who enjoys public recognition and who uses this recognition on behalf of a

consumer good by appearing with it in an advertisement (marcoms), isuseful, because when celebrities are depicted in marcoms, they bring their

own culturally related meanings, thereto, irrespective of the required

promotional role."

Friedman and Friedman (1979) found empirical evidence that, in the

promotion of products high in psychological and/or social risk, use of

celebrity endorser would lead to greater believability, a more favorable

evaluation of the product and advertisement, and a significantly more

positive purchase intention.

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Thus, companies use celebrities to endorse their products; however, there are

deeper attributes that are involved in celebrity endorsement. Celebrities

might endorse as a brand ambassador or a brand face.

4.3.1 Types of Celebrity Endorsements

Celebrity branding has many aspects. A slight change in the type of

branding used can result in either a great success or a dismal failure.

Celebrity branding falls into five general categories:

Testimonial: The celebrity acts as a spokesperson for the brand.

Imported: The celebrity performs a role known to the audience. Invented: The celebrity plays a new, original role. Observer: The celebrity assumes the role of an observer commenting

on the brand. Harnessed: The celebrity's image is integrated with the ad's storyline.

4.4 CELEBRITY AND BRAND:According to Advertising research companies that actors bring reliability

and trust in the brand and above all, they help in increasing the sales

revenues. Celebrity endorsements are powerful. This power is offered by the

following elements, which also creates a 'Top of the Mind Position'.

Instant Awareness, knowledge about the brand and easy recall.

Values and image of the brand is defined, highlighted and refreshed by the celebrity.

The celebrity adds new edge and dimension to the brand.

Credibility, trust, association, aspiration and connectivity to brand.

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Belief in efficiency and new appearance that will result in at least trial

usage.

4.4.1 Celebrity and Brand Compatibility :

A celebrity is used to impart credibility and aspirational values to a brand,

but the celebrity needs to match the product. A good brand campaign idea

and an intrinsic link between the celebrity and the message are musts for a

successful campaign. Celebrities are no doubt good at generating attention,recall and positive attitudes towards advertising provided that they are

supporting a good idea and there is an explicit fit between them and the

brand. On the other hand, they are rendered useless when it comes to the

actual efficiency of the core product, creating positive attitudes to brands,

purchase intentions and actual sales.

Certain parameters that postulate compatibility between the celebrity and

brand image are:

Celebritys fit with the brand image. CelebrityTarget audience match Celebrity associated values. Costs of acquiring the celebrity.

CelebrityProduct match. Celebrity controversy risk.

Celebrity popularity. Celebrity availability.

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Celebrity physical attractiveness. Celebrity credibility. Celebrity prior endorsements.

Whether celebrity is a brand user. Celebrity profession.

4.5 UNDERSTANDING CONSUMER BEHAVIOUR

Consumer Behavior is the study of how people buy, what do they buy,

when do they buy and why do they buy. It blends elements from

psychology, sociology, socio-psychology, anthropology and economics. Ittries to understand the buyer decision-making process, both individually and

in groups. It studies the characteristics of individual consumers such as

demographics, psychographics, and behavioral variables in an attempt to

understand people's wants and also assess influences on the consumer from

various groups such as family, friends, reference groups, and society in

general.

The study and knowledge of consumer behavior is essential to the firms as it

helps them to improve their marketing strategies and product offerings.

Following are some of the important issues that have significant influence

on consumer's psyche that affects their buying behaviour:

The psychology of how consumers think, feel, reason, and select

between different alternatives (e.g., brands, products);

The psychology of how the consumer is influenced by his or her

environment (e.g., culture, family, signs, media);

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Limitations in consumer knowledge or information processing

abilities influence decisions and marketing outcome;

How consumer motivation and decision strategies differ between

products that differ in their level of importance or interest that they

entail for the consumer; and

How marketers can adapt and improve their marketing campaigns and

marketing strategies to more effectively reach the consumer.

Their Age, Religion, Culture, Income, informal group and Referent

Group.

4.5.1 Consumer Decision Making Process:

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The above process is explained here:

The first step to consumer buying process starts with problem recognition or

with an unsatisfied need of a consumer. Something, that a consumer wouldlike to have or purchase in order to attain satisfaction. This need can be

Psychological, attitudinal or Physiological.

The next stage includes the ability to purchase, level of involvement, people

whose opinion will count and other relevant details that will help in

optimizing the consumer satisfaction.

Based upon information search various alternatives are generated i.e. which

brand or product is affordable to the consumer, where will it be comfortably

available and in comparison to other brands or products how better or

economical it is.

The next stage is the Evaluation stage which takes into consideration cost

benefit analysis and based upon maximum value or utility per rupee spend,

consumer decides or shortlist the product or brand. This is the decision and

confirmation stage where the consumers prepares him for the purchase of a

particular brand and give preference to one and only one over and above the

others.

Next stage in the consumer decision making process is the purchase when

the consumer finally goes to the market and looks for the brand or the

product, physically verifies it and purchases it.

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Last stage is the post purchase Evaluation in which the customer justifies his

consumption or purchase decision. He tries to find out whether his purchase

decision was right or not. Companies make a lot of effort to tackle this

situation successfully and they want the customer to be satisfied with their product.

The last stage may result into three situations:

Satisfaction where customer is satisfied as he got expected results but

this does not necessitates the repeat purchase by the consumer.

Dissonance where the consumer is not satisfied as he got less utility or less than expected result from the consumption or product

performance.

Delight where the consumer gets more than expected satisfaction and

utility and this will assure the repeat purchase and creation of brand

loyalty.

4.5.2 Impact of Brand on Consumer Decision Making Process

Research studies have proven that known products and names are sold more

than unknown ones. Therefore, a known brand or an optimally exposed

brand will find more recognition and buyers in the market in comparison to

completely unknown or unexposed brand. Recognition of brand and its

significance along with the traditional factors plays a very significant role in

consumer decision-making process.

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The above given model explains the important role that a brand plays in

three different stages of consumer's purchase decision making. A consumer start collecting data or information about his favorite brand, than he keeps

his favorite as one of the alternatives and he evaluate his selected brand

against all available options and on finding it suitable or best among all

options, based upon a qualitative and quantitative evaluation he ultimately

purchases the selected or favorite brand.

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CHAPTER-5.0

THE ADVANTAGES ANDDISADVANTAGES OF USINGCELEBRITY AS ENDORSERS

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5.0 THE ADVANTAGES AND DISADVANTAGES OF

USING CELEBRITY AS ENDORSERS

The Argument for Celebrity Endorsement

Brands have been leveraging celebrity appeal for a long time. Across

categories, whether in products or services, more and more brands are

banking on the mass appeal of celebrities. As soon as a new face ascends the popularity charts, advertisers queue up to have it splashed all over. Witness

the spectacular rise of Sania Mirza and Irfan Pathan in endorsements in a

matter of a few months. The accruement of celebrity endorsements can be

justified by the following advantages that are bestowed on the overall brand:

Establishment of Credibility: Approval of a brand by a star fosters a

sense of trust for that brand among the target audience- this is

especially true in case of new products. We had the Shah Rukh-Santro

campaign. At launch, Shah Rukh Khan endorsed Santro and this

ensured that brand awareness was created in a market, which did not

even know the brand.

Ensured Attention: Celebrities ensure attention of the target group

by breaking the clutter of advertisements and making the ad and the

brand more noticeable.

PR Coverage: is another reason for using celebrities. Managers

perceive celebrities as topical, which create high PR coverage. A good

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example of integrated celebrity campaigns is one of the Worlds

leading pop groups, the Spice Girls, who have not only appeared in

advertisements for Pepsi, but also in product launching and PR events.

Time Saving: Celebrity is able to build brand credibility in a short period of time.

Higher Degree of Recall : People tend to commensurate the

personalities of the celebrity with the brand thereby increasing the

recall value. Golf champion Tiger Woods has endorsed American

Express, Rolex, and Nike. Actress Catherine Zeta-Jones is used by T-

Mobile and Elizabeth Arden. 007 Pierce Brosnan promotes Omega,BMW, and Noreico.

Associative Benefit: A celebritys preference for a brand gives out a

persuasive message - because the celebrity is benefiting from the

brand, the consumer will also benefit.

Mitigating a Tarnished Image : Cadbury India wanted to restore the

consumer's confidence in its chocolate brands following the high- pitch worms controversy; so the company appointed Amitabh

Bachchan for the job. Last year, when the even more controversial

pesticide issue shook up Coca-Cola and PepsiCo and resulted in much

negative press, both soft drink majors put out high-profile damage

control ad films featuring their best and most expensive celebrities.

While Aamir Khan led the Coke fight back as an ingenious and

fastidious Bengali who finally gets convinced of the product's `purity,'

PepsiCo brought Shah Rukh Khan and Sachin Tendulkar together

once again in a television commercial which drew references to the

`safety' of the product indirectly.

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Psychographic Connect: Celebrities are loved and adored by their

fans and advertisers use stars to capitalize on these feelings to sway

the fans towards their brand.

Demographic Connect: Different stars appeal differently to various

demographic segments (age, gender, class, geography etc.).

Mass Appeal: Some stars have a universal appeal and therefore prove

to be a good bet to generate interest among the masses.

Providing Testimony: Another benefit of using celebrity endorsers is

that s/he can provide testimony for a product or service, particularly

when the product has contributed to their celebrity. The more familiar an endorser, the more likely consumers are to buy the endorsed

product.

Rejuvenating a Stagnant Brand: With the objective of infusing

fresh life into the stagnant chyawanprash category and staving off

competition from various brands, Dabur India roped in Bachchan for

an estimated Rs 8 crore. Celebrity endorsement can sometimes compensate for lack of

innovative ideas.

The Argument Against Celebrity Endorsement

The Reputation of the Celebrity May Derogate After he/she has

Endorsed the Product: Pepsi Cola's suffered with three tarnished

celebrities - Mike Tyson, Madonna, and Michael Jackson. Since the

behaviour of the celebrities reflects on the brand, celebrity endorsers

may at times become liabilities to the brands they endorse.

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The Vampire Effect: This terminology pertains to the issue of a

celebrity overshadowing the brand. If there is no congruency between

the celebrity and the brand, then the audience will remember the

celebrity and not the brand. Examples are the campaigns of DawnFrenchCable Association and Leonard RossiterCinzano. Both of

these campaigns were aborted due to celebrities getting in the way of

effective communication. Another example could be the Castrol

commercial featuring Rahul Dravid.

Inconsistency in The Professional Popularity of The Celebrity :

The celebrity may lose his or her popularity due to some lapse in professional performances. For example, when Tendulkar went

through a prolonged lean patch recently, the inevitable question that

cropped up in corporate circles - is he actually worth it? The 2003

Cricket World Cup also threw up the Shane Warne incident, which

caught Pepsi off guard. With the Australian cricketer testing positive

for consuming banned substances and his subsequent withdrawal from

the event, bang in the middle of the event, PepsiCo - the presenting

sponsor of the World Cup 2003 - found itself on an uneasy wicket

Multi Brand Endorsements: by the same celebrity would lead to

overexposure: The novelty of a celebrity endorsement gets diluted if

he does too many advertisements. This may be termed as

commoditisation of celebrities, who are willing to endorse anything

for big bucks. Example, MRF was among the early sponsors of

Tendulkar with its logo emblazoned on his bat. But now Tendulkar

endorses a myriad brands and the novelty of the Tendulkar-MRF

campaign has scaled down.

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Celebrities Endorsing one Brand and Using another (competitor) :

Sainsburys encountered a problem with Catherina Zeta Jones, whom

the company used for its recipe advertisements, when she was caught

shopping in Tesco. A similar case happened with Britney Spears whoendorsed one cola brand and was repeatedly caught drinking another

brand of cola on tape.

Mismatch Between the Celebrity and the Image of the Brand:

Celebrities manifest a certain persona for the audience. It is of

paramount importance that there is an egalitarian congruency between

the persona of the celebrity and the image of the brand. Each celebrity portrays a broad range of meanings, involving a specific personality

and lifestyle. Madonna, for example, is perceived as a tough, intense

and modern women associated with the lower middle class. The

personality of Pierce Brosnan is best characterized as the perfect

gentlemen, whereas Jennifer Aniston has the image of the good girl

from next door.

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CHAPTER-6.0

CELEBRITY ENDORSEMENT- ANINDIAN PERSPECTIVE

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6.0 CELEBRITY ENDORSEMENT- AN INDIANPERSPECTIVE

The latter part of the '80s saw the burgeoning of a new trend in India

brands started being endorsed by celebrities. Hindi film and TV stars as well

as sportspersons were roped in to endorse prominent brands.

Advertisements, featuring stars like Tabassum (Prestige pressure cookers),

Jalal Agha (Pan Parag), Kapil Dev (Palmolive Shaving Cream) and SunilGavaskar (Dinesh Suitings) became common. Probably, the first ad to cash

in on star power in a strategic, long-term, mission statement kind of way was

Lux soap. This brand has, perhaps as a result of this, been among the top

three in the country for much of its lifetime.

In recent times, we had the Shah Rukh-Santro campaign with the objective

of mitigating the impediment that an unknown Korean brand faced in theIndian market. The objective was to garner faster brand recognition,

association and emotional unity with the target group. Star power in India

can be gauged by the successful endorsement done by Sharukh for three

honchos- Pepsi, Clinic All Clear and Santro. Similarly, when S Kumars used

Hrithik Roshan, then the hottest advertising icon for their launch advertising

for Tamarind, they reckoned they spent 40 - 50 per cent less on media due tothe sheer impact of using Hrithik. Ad recall was as high as 70 per cent, and

even the normally conservative trade got interested.

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In the Indian context, it would not be presumptuous to state that celebrity

endorsements can aggrandize the overall brand. We have numerous

examples exemplifying this claim. A standard example here is Coke, which,

till recently, didn't use stars at all internationally. In fact, India was a first for them. The result was a ubiquitously appealing Aamir cheekily stating

Thanda matlab Coca Cola . The recall value for Nakshatra advertising is

only due to the sensuous Aishwarya. The Parker pen brand, which by itself

commands equity, used Amitabh Bachchan to revitalize the brand in India.

According to Pooja Jain, Director, Luxor Writing Instruments Ltd (LWIL),

post Bachchan, Parker's sales have increased by about 30 per cent.

India is one country, which has always idolized the stars of the celluloid

world. Therefore it makes tremendous sense for a brand to procure a

celebrity for its endorsement. In India there is an exponential potential for a

celebrity endorsement to be perceived as genuinely relevant, thereby

motivating consumers to go in for the product. This would especially prove

true if the endorser and the category are a natural lifestyle fit likesportspersons and footwear, Kapil-Sachin and Boost or film stars and beauty

products.

SOME GLOBAL EXAMPLES:

Globally, firms have been juxtaposing their brands and themselves with

celebrity endorsers. Some successful ongoing global endorsements are asfollows:

Celebrity endorsements have been the bedrock of Pepsi's advertising.

Over the years, Pepsi has used and continues to use a number of

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celebrities for general market and targeted advertising, including

Shaquille O'Neal, Mary J. Blige, Wyclef Jean, and Busta Rhymes,

who did a targeted campaign for their Mountain Dew product.

George Foreman for Meineke. He has also sold more than 10 millionLean Mean Fat-- Reducing Grilling Machines since signing with the

manufacturing company.

James Earl Jones for Verizon and CNN.

Nike golf balls, since the company signed Tiger Woods in 1996, have

seen a $50 million revenue growth. Nike's golf line grossed more than

$250 million in annual sales. In 2000 he renegotiated a five-year contract estimated at $125 million.

Other successful endorsements like NikeMichael Jordan, Dunlop

John McEnroe, AdidasPrince Naseem Hamed, and so on.

Venus Williams, tennis player and Wimbledon champion has signed a

five-year $40 million contract with sportswear manufacturer Reebok

International Inc.

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CHAPTER-7.0

FINDINGS AND ANALYSIS

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AGE PROFILE

Age group Percentage of people18-25yrs 66%25-35 yrs 28%35-50 yrs 6%

Above 50 yrs 0

This research project is based on the responses of people belonging to theage group of 18 to 25 years of age, around 28% belongs to the age group of 25 to 35 years of age and only 6% belongs to the category of 35 to 50 yearsof age group.Therefore this research project is based on the perception of youth. That ishow the consumer belonging to this age group reacts to the celebrityendorsement strategies taken by the companies.

GENDER PROFILE

PERCENTAGE

52%48% MALE

FEMALE

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The number of respondents taken to fill this questionnaire has been equallydivided into males and females, so that there is no biasness between theresponses. Due to this reason perceptions of both the gender have been takeninto consideration.

ARE ADVERTISEMENTS INFORMATIVE?

10%

90%

yes

no

According to the survey done it can be inferred that most of theconsumers feel advertisements are very informative, whether they are in

any form i.e. media, newspaper, magazines etc. Majority of people thinksthat advertisement helps them to get the brief information about the product even before its launch. As a result it influences their buyingdecision to some extent.

WHAT FACTORS AFFECT A CONSUMER BUYING DECISION

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Motivating factors to buy a product

020406080

100120

Mostimportant

factor

2ndimportant

factor

3rdimportant

factor

4thimportant

factor

leastimportant

factor

degree of importance

% o

f r e s p

o n

d e n

t s celebrity endorsement

Latest trends

Discounts and offers

Quality

Price

According to the survey, it can be concluded that majority of consumers(44%) give utmost importance to quality while going for a particular

product, followed by price, discounts, offers etc. While celebrityendorsement is the least important feature that most of the consumers(44%) consider while making their purchase decision. Thus latest trendsand celebrity endorsement does not play such an important role ininfluencing a consumers buying decision as compared to other factors.

DOES CELEBRITIES CAST IMPACT?

Do celebrities cast impact through advertisement

88%

12%

yesno

From the above chart it can be concluded that celebrities cast impact throughadvertisement. 88% of respondents feel that Celebrities ensure attention of the target group by breaking the clutter of advertisements and making the adand the brand more noticeable. Besides this, people perceive celebrities astopical, which create high PR coverage.

Thus the above graph proves that in the Hypothesis , Null Hypothesis isaccepted, that is Celebrity Endorsement does cast an impact on consumer

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buying behaviour through advertisements. And Alternate Hypothesis isrejected.

IF YES, THEN HOW?if yes, how?

50%

30%

20% Attracts attention

Build desire tohave a productinitiate an ac tion tobuy a product

Attracting attention, building desire to have a product and initiating anaction to buy a product are the various basis through which celebrities castimpact through advertisement. Majority of the respondents are of the viewthat celebrities attract the attention of their target group. People tend tocommensurate the personalities of the celebrity with the brand therebyincreasing the recall value. Whereas 26% people think that celebrity of their choice build desire in them to make a purchase. Some stars have a universalappeal and therefore prove to be a good bet to generate interest among themasses.

CELEBRITIES HELP IN INCREASING THE MARKET SHARE?

Do celebrities help in increasing the market share of thecompany

52%34%

14% AlwayssometimesNever

On the basis of the survey it can be inferred that celebrities helps inincreasing the market share of the company. 52% of people support this

point. Besides this, it also helps in rejuvenating a stagnant brand. Whereas,

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34% of people thinks the other way round. According to them they(celebrities) not always help in increasing the share of company i.e. thereputation of the celebrity may derogate after he/she has endorsed the

product.

DOES CELEBRITIES USE THE PRODUCT THEY ENDORSE?

Do celebrities use the product they endorse

12%

82%

6%

yesnocant say

According to the responses in the questionnaire, 82% of the respondents believe that celebrities do not use the product that they endorse. 12% of them believe that the celebrities does use the products so endorsed by themin their daily lives. And 6% are not sure whether the celebrities use the

products they endorse or they do not. Thus we can conclude that in todays

world consumers are educated and do not get carried away by the celebritiesthey see endorsing the product.IS IT ETHICAL TO ENDORSE A PRODUCT NOT USED BY

CELEBRITIES?if no, is it ethical?

26, 63%

15, 37% noyes

This chart shows whether the consumers believe that when celebrities do notuse the product they endorse then is it ethical for them to endorse such a

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product. The majority of the people believe that is 63% of them say it is notethical for celebrities to do such a thing. And only 37% says it is ethical.Thus it can be inferred that most of the consumers are infect against thewrong perception that celebrities try to make in the mind of the consumers.They say that it is not morally correct on the part of the celebrities to do sucha thing.

DOES INVESTMENT MADE IN CELEBRITIES ACTUALLYBENEFIT THE COMPANY?

companies investing huge money for usingcelebrities help them in increasing their total

revenue?

84%

16% somewhat

agreesomewhatdisagree

The above chart explains that when companies invest huge amount of money for using celebrities, does according to the consumers it actually help the companiesto increase their total revenue. Majority (i.e 84%) somewhat agrees to the fact thatthe celebrities does help in increasing the total revenue of the company from their endorsements. A small percentage (i.e. only 16%) somewhat disagree to thisstatement. This small number of people does not agree and thus say that investingsuch huge amounts in celebrities are not necessary if their products are goodenough.

WHICH OF THE CELEBRITIES ARE MOST AFFECTIVE?

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0%

20%

40%

60%

80%

100%

percentage

Sportsperson

Filmstar TV star Politician

celebrity

what kind of celebrity are most affective?

Not affectiveaffectivevery affective

The above chart explains what kinds of celebrities are most affective in endorsingthe products. Film stars are the ones who have the most prominent impact on the

buying behaviour of the consumers. Next comes the sports persons who easilyconnect to the people and have power to change the purchasing decisions. T.Vstars are not very affective but they do have some impact, may be because peoplesee them on television daily and thus becomes a part of their lives. The leastaffective celebrities are the politicians who hardly have any impact on theconsumers. We can say that people do not perceive politicians as topical whichcreates high PR coverage.

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GENDER WISE MOTIVATING FACTORS

02468

10121416

Price as mostimportant

Quality asmost important

Discounts &offers as most

important

Latest Trendsas most

important

Celebrityendorsement

as most

importantMotivating factors to buy a product

N u m

b e r o

f r e s p o n

d e n

t s

Male

Female

If we segregate the consumers into male and female and then see what factorsmotivates them the most then we can say that for both males and females Qualityis the utmost important factor to buy a product. Then while price is the secondmost important factor for males, discounts and offers are considered by females.And for males discounts and offers are not even considered while purchasing the

product. While for both males and females celebrity endorsements have been theleast motivating factor.

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CHAPTER-8.0

SUGGESTIONS

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8.0 SUGGESTIONS Companies must try and use a celebrity whose personality matches the

brand attributes and branding strategy. Only a good match helps to

enhance the brand value. Companies should avoid using a celebrity who is endorsing many

brands simultaneously. In such a case the consumers get confused and

may fail to associate the celebrity with the brand. Moreover using a

multi brand endorser does not influence the rate of brand recall as

much.

Companies should try and focus on the product quality, price, and

promotional schemes rather than primarily focusing on the Celebrity.

As per the research the consumers give more importance to these

factors as compared to the celebrity endorsing the product.

Since celebrities are better at attracting attention than leading to

purchase behavior, companies must also keep this factor in mind

while choosing a celebrity.

Though the intelligent consumer of today understands that the

celebrity endorsing a product does not necessarily use it, the

percentage of such consumer is small. Also most people feel it is

unethical to proclaim such a thing. Hence a company must be careful

that a celebrity endorsing product A is not seen publicly using the

competing brand. This may lead to negative publicity.

When it comes to celebrities, Film stars and Sports persons have a

greater impact on public as compared to Television stars and

Politicians. As the image of politicians and T.V stars is frequently

variable they may hamper the brand image. Companies must be

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careful to use politicians and T.V stars for selective brands whose

target audience is influenced essentially by such celebrities.

While using celebrities to endorse a product the cost factor should

always be kept in mind. The revenue might not be as high as the costincurred in using a particular celebrity.

While planning the advertising, the company must make sure that the

celebrity does not overpower the brand. In all advertising messages

and PR activities the brand must be highlighted more than the

celebrity.

The aim of any promotional activity is enhancement of the brand. Thecelebrity must act according to the brand and the branding must not

change according to the celebrity as they may prove fatal to the

products individual image in the long run.

While choosing a celebrity, only his present must not be considered.

Celebrities in general have a long term effect on brands hence a

conscious decision must be made considering their past, present andgazing into their future projects and actions.

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CONCLUSIONS

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CONCLUSIONS

In India today, the use of celebrity advertising for companies has become a

trend and a perceived winning formula of corporate image-building and

product marketing.

Advertisement is a medium through which a brand gets a personality and

endorsers are perceived as the personalities of the brand. Therefore, as it is

essential to bring a synergy between an individual's outfit and his

personality, the same way it is essential to bring a synergistic effect betweenthe brand and the endorser

Brands rely on celebrities for the following reasons: -

Credibility: Approval of a brand by a star fosters a sense of

trust for that brand among the target audience

Attracts Attention: Celebrities ensure attention of the targetgroup by breaking the clutter of advertisements and making the

ad and the brand more noticeable.

Associative Benefit: A celebrity's preference for a brand gives

out a persuasive message - because the celebrity is benefiting

from the brand, the consumer will also benefit.

Approval of a brand by a star fosters a sense of trust for that brand among

the target audience. This is especially true in case of new product. There is a

demographic and psychographic connection between the stars and their fans.

Demographic connection establishes that different stars appeal differently to

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various demographic segments i.e. age, gender, class, geography etc., while

psychographic connection establishes that stars are loved and adored by their

fans. Some stars have a universal appeal and therefore prove to be a good bet

to generate interest among the masses. Another invaluable benefit fromcelebrity endorsements is the public relation opportunities.

Selecting a celebrity involves a lot of financial risk. At some point in the

decision to use celebrity endorsers, advertisers have to consider the cost

effectiveness of their choice. The endorser who appears to have the highest

potential, tend to be the most popular, and therefore, the most expensive to

hire as an endorser. The demand for entertainment and sports celebrities has

increased, and these individuals are sometimes very expensive to use as

endorsers. In this situation, the advertiser must decide whether the celebrity

is worth the investment.

The impact of an endorser cannot be sustainable in all product categories

and in all the stages of brand life cycles. It really depends upon the type of

product. If it is a 'functional brand', then the product itself is the hero. Here

any celebrity association with the brand without corresponding performance

of the product will not be sustainable. While in case of 'image brands', like

the categories of soaps, soft drinks, cigarettes etc., where it is difficult to

distinguish between the products, celebrity endorsements help to distinguish

between the brands at an emotional level.

It would be difficult to judge the direct effect of celebrity endorsement on

the sales or profits of the company. On Amitabh Bachchan endorsing RIN,

HLL could not comment much on its sales and that though Dabur healthcare

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products' sales had improved. Similarly, there are also cases wherein there

was a dramatic change in the sales figure after the endorsements. For

example, Celebrity endorsement helped Head & Shoulders promote their

brand and within a year they became market leaders with over 45% marketshare.

A celebrity does help in increasing brand sales, but only if he/she is selected

carefully and used effectively. The personality of the brand and the celebrity

have to complement each other and the selection of the celebrity is,

therefore, very important.

With the help of the literature we have managed to close the knowledge gap

and created a literature review about Celebrity Endorsement. In broad terms

one can conclude that endorsement does work, consumers do respond to an

endorsement of a product by a celebrity. The fact of associating a product

with a well-known individual acts to increase the positive view of the

consumer. The potential benefits from endorsement for the brand owner are

clear, so long as the links are indisputable and match links in the consumer's

mind.

A celebrity is a means to an end, and not an end in himself or herself.

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CHAPTER-9.0BIBLIOGRAPHY AND REFERENCES

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9.0 BIBLIOGRAPHY AND REFERENCES

1) Belch, G.E., & Belch, M.A. (2001). Advertising and Promotion: An

integrated Marketing Communications Perspective (5thed.). Boston:

Irwin/MaGraw-Hill.

2) Kotler, P., Armstrong, G., Saunders, J., & Wong, V. (2001).Principles

ofMarketing. Prentice Hall: Harlow

3) Kotler, P., Bowen, J., and Makens, J. (1999) Marketing for

Hospitality and Tourism, 2nd Ed., Upper Saddle River: Prentice Hall

Inc.4) Kotler, P. (1997), Marketing management: analysis, planning,

implementation, and control , 9 th Ed., London: Prentice Hall

International.

5) Kotler, P. (1984), Marketing essentials, London: Prentice-Hall

6) Riezebos, R., Kist, B., Koostra. G. (2003), Brand Management. A

theoretical and practical approach. Prentice Hall

7) Till, B.D., & Schimp, T.A. (1998).Endorsers in Advertising: The case

of Negative Celebrity Information: Journal ofAdvertising,27

8) http://www.rediff.com/money/2003/dec/05guest.htm, Country Manager -Discovery, Ogilvy and Mather India

9) Aaker, David A. (1996), Building Strong Brands . New York, NY: The

Free Press.

10) Daneshvary, Rennae and R. Keith Schwer (2000), "The AssociationEndorsement and Consumers' Intention to Purchase," Journal of

Consumer Marketing , 17 (3), 203-213.

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11) Friedman, Hershey H. and Linda Friedman (1979), "Endorser

Effectiveness by Product Type," Journal of Advertising Research , 19

(5), 63-71.

12) McCracken, Grant (1989), "Who Is the Celebrity Endorser? CulturalFoundations of the Endorsement Process," Journal of Consumer

Research , 16 (3), 310-321.

13) http://www.thehindubusinessline.com/2008/04/09/stories/20080409

50750500.htm

14) http://www.marketingprofs.com

15) http://www.brandchannel.com

16) http://papers.ssrn.com

17) http://hull.aug.edu/thoughtLeadership/research/Amos-Holmes-

Strutton-IJA-2008.pdf

18) advertising.about.com/od/ celebrityendorsements/Celebrity_Endorsem

ents.htm

19) www.merinews.com/catFull.jsp? article ID=183

20) http://www.businessweek.com/smallbiz/content/nov2008/sb2008111

4_106175.htm

21) http://www.ingentaconnect.com/content/westburn/jmm/1999/00000

015/00000004/art00005

22) http://lifestyle.in.msn.com/fashion/article.aspx?cp-

documentid=1671484

23) http://www.indianmba.com/Faculty_Column/FC706/fc706.html24) http://www.ibsaf.org/icfai_books/Celebrity_Endorsements_Perspecti

ves_%20and_Cases.html

25) http://www.indiantelevision.com/tamadex/y2k8/sep/tam38.php

26) http://www.theindiastreet.com/celebrity-endorsement

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http://www.thehindubusinessline.com/2008/04/09/stories/2008040950750500.htmhttp://www.thehindubusinessline.com/2008/04/09/stories/2008040950750500.htmhttp://www.marketingprofs.com/http://www.brandchannel.com/http://papers.ssrn.com/http://hull.aug.edu/thoughtLeadership/research/Amos-Holmes-Strutton-IJA-2008.pdfhttp://hull.aug.edu/thoughtLeadership/research/Amos-Holmes-Strutton-IJA-2008.pdfhttp://www.merinews.com/catFull.jsp?articleID=183http://www.merinews.com/catFull.jsp?articleID=183http://www.merinews.com/catFull.jsp?articleID=183http://www.merinews.com/catFull.jsp?articleID=183http://www.merinews.com/catFull.jsp?articleID=183http://www.businessweek.com/smallbiz/content/nov2008/sb20081114_106175.htmhttp://www.businessweek.com/smallbiz/content/nov2008/sb20081114_106175.htmhttp://www.ingentaconnect.com/content/westburn/jmm/1999/00000015/00000004/art00005http://www.ingentaconnect.com/content/westburn/jmm/1999/00000015/00000004/art00005http://lifestyle.in.msn.com/fashion/article.aspx?cp-documentid=1671484http://lifestyle.in.msn.com/fashion/article.aspx?cp-documentid=1671484http://www.indianmba.com/Faculty_Column/FC706/fc706.htmlhttp://www.ibsaf.org/icfai_books/Celebrity_Endorsements_Perspectives_%20and_Cases.htmlhttp://www.ibsaf.org/icfai_books/Celebrity_Endorsements_Perspectives_%20and_Cases.htmlhttp://www.indiantelevision.com/tamadex/y2k8/sep/tam38.phphttp://www.thehindubusinessline.com/2008/04/09/stories/2008040950750500.htmhttp://www.thehindubusinessline.com/2008/04/09/stories/2008040950750500.htmhttp://www.marketingprofs.com/http://www.brandchannel.com/http://papers.ssrn.com/http://hull.aug.edu/thoughtLeadership/research/Amos-Holmes-Strutton-IJA-2008.pdfhttp://hull.aug.edu/thoughtLeadership/research/Amos-Holmes-Strutton-IJA-2008.pdfhttp://www.merinews.com/catFull.jsp?articleID=183http://www.businessweek.com/smallbiz/content/nov2008/sb20081114_106175.htmhttp://www.businessweek.com/smallbiz/content/nov2008/sb20081114_106175.htmhttp://www.ingentaconnect.com/content/westburn/jmm/1999/00000015/00000004/art00005http://www.ingentaconnect.com/content/westburn/jmm/1999/00000015/00000004/art00005http://lifestyle.in.msn.com/fashion/article.aspx?cp-documentid=1671484http://lifestyle.in.msn.com/fashion/article.aspx?cp-documentid=1671484http://www.indianmba.com/Faculty_Column/FC706/fc706.htmlhttp://www.ibsaf.org/icfai_books/Celebrity_Endorsements_Perspectives_%20and_Cases.htmlhttp://www.ibsaf.org/icfai_books/Celebrity_Endorsements_Perspectives_%20and_Cases.htmlhttp://www.indiantelevision.com/tamadex/y2k8/sep/tam38.php


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ANNEXUERS

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QUESTIONNAIRE

Name :Income :

Gender :Age : 18-25yrs 25-35yrs35-50yrs above 50yrs

Occupation :

1) Do you think Advertisement informative?

Yes No

2) What is a motivating factor to buy a product? Rank the below according to your preference (keeping 1 as the highest and 5 as the lowest).

Price

Quality

Discounts and offers

Latest Trends

Celebrities endorsing the product

Any other______________________________

3) According to you do Celebrities cast impact through Advertisements?

Yes No

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4) If Yes?

Attracts Attention

Build Desire to have the product

Initiate an action to buy the product

5) Does Celebrities helps in increasing the market share of the company?

Yes No6) What do you think, do celebrities themselves uses the product they endorses?

Yes No

7) If No, do you think is it ethical to do such a thing?

Yes No

8) Do you think companies investing huge money for using celebrities help them inincreasing their total revenue?

Yes No

9) What kinds of celebrity are most affective?

Very Affective Affective Not AffectiveSports PersonFilm Star TV star Politician

10) According to you what are other risks involved in using celebrity asendorsements?

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CHAPTER-10.0

CASE STUDY

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10.0 CASE STUDY

THE SIYARAM CELEBRITY ENDORSEMENT EXPERIENCE

"We have enough of film stock for a whole year. Unfortunately we can't

use them anymore."

- N Gangadhar, General Manager (Marketing), Siyaram Silk Mills,

commenting on the withdrawal of the J Hampstead advertisement campaign,

in April 2000.

The Cronje Scandal

In April 2000, the New Delhi police unearthed one of the biggest scandals

ever to hit the world of cricket. While investigating a local corruption case,

officials recorded phone conversations between Hansie Cronje (Cronje), the

captain of the South African cricket team, and Sanjeev Chawla, a London-

based Indian businessman. The conversation in the tapes seemed to

implicate both men in illegal betting on a match played in February 2000 in

India. After initial denials, Cronje conceded that he had accepted $ 15,000 to

fix the match.

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The news shocked both cricket fans and the media alike - Cronje's face was

smeared with black paint on posters across the country. Siyaram Silk Mills

Ltd. (Siyaram), one of India's leading textile companies, was also affected

badly by this controversy. Hansie Cronje was one of the key celebrityendorsers for Siyaram's J.Hampstead brand of clothing. The campaign

featuring Cronje had been running on the print, electronic and outdoor media

from March 2000. Siyaram and its advertising agency, Percept, watched in

dismay as their celebrity endorser turned into an internationally hated

sportsman overnight. The issue raised a heated debate in corporate and

media circles regarding the perils of using celebrity endorsement. Percept

sources commented, "This mess is horrible."

Union Minister of State for Information and Broadcasting Arun Jaitley, who

was also president of the Delhi District Cricket Association, said the Delhi

police would take the scandal to its ''logical end''. ''The tapes have proved

beyond doubt the involvement of the South African skipper,''

What happens when models turn 'villains'? Why did the advertisers choose

Cronje & Co? How much were they paid? These and more questions

surfaced.

Siyaram pulled down all the billboards featuring the entire South African

team across the country. The J.Hampstead campaign was completely

withdrawn, almost 20 days before it completed its scheduled run onhoardings and television. The 'match-fixing' scandal seemed all set to force

Siyaram and other Indian companies to rewrite the rules of using

celebrity endorsement as an integral part of their media plans.

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Background Note

Siyaram was a part of the Siyaram Poddar Group of companies, which had a

turnover of $ 209 billion in 2000-01. The group, founded in 1954, was into

the textile (yarns, fabrics and garments), paper/paperboards and tyre (rubber

tyres and tubes) businesses. While Govind Rubber Ltd. (GRL) was into the

auto and bicycle tyres and tubes business, Balkrishna Industries Ltd. (BIL)

was into the manufacturing of paperboards, tyres/tubes and synthetics.

Siyaram's businesses comprised fabrics and readymade garments. Its popular

brands included Oxemberg (shirts, trousers and jeans) and J.Hampstead

(wool fabric). Siyaram was incorporated in June 1978 as a private limited

company and was converted into a public limited company in 1980.

Siyaram Finance, its subsidiary, was into the financial services business.

Siyaram manufactured and marketed textiles, cotton, woollen synthetics and

synthetic blends the main product being polyester blended worsted2

fabrics. In July 1993, Siyaram came out with a Rs 153 million rights issue to

part-finance a Rs 165 million expansion-cum-modernization project. While

the family held 23% of the Rs 51 million equity, foreign collaborators,

financial investors and the public held 26%, 22% and 8% respectively.

Siyaram had a strong presence in the lower and medium segment of the

domestic suitings market.

The company had three manufacturing plants situated at Thane and Raigadin Maharashtra and Silvassa in the union territory of Dadra & Nagar Haveli,

producing over 27.5 million meters of fabrics annually. Siyaram had a 4%

market share in the Rs 50 billion suitings and shirtings market.

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The other players included Vimal, Mayur, Raymond, Digjam, Gwalior and

Reid & Taylor etc. Siyaram retailed its products through 25 exclusive

showrooms, besides its distributor network of about 400 wholesale dealers

and 50,000 retailers across the country. (The number of exclusiveshowrooms was to be increased to 75 by August, 2002.) The company also

exported its products to Europe, South America, South Africa, the Far East

and the Gulf countries.

Siyaram's sales increased from Rs 20 million in 1978 to Rs 3252.6 million in

2000-01. Siyaram was one of the few non-FMCG companies in India that

was known for its lavish advertisements. The 'Coming Home To Siyaram'

campaign was reported to be one of Indian advertising's costliest campaigns.

The 'Coming Home To Siyaram' advertisements were much talked about for

being of much longer duration than the usual advertisements, and also for

the huge budgets Siyaram set aside for them. The company believed that

good commercials helped it to effectively position its suitings on a global

platform. Siyaram officials said the company's focus o

impact of celebrity endorsement.......1

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