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Impact of Celebrity Endorsement on Overall Brand

By

Sanyukta A. KulkarniSahir U. Gaulkar

PGDBM1 2005-07Welingkar Institute of Management Development & Research

L. Napoo Road, Matunga (CR), Mumbai400 019

E-mail: [email protected] / [email protected]

Synopsis

Today 'Celebrity Endorsement' has attracted immense debate on whether it really contributes to thebrand building process or whether it is just another lazy tool to make the brand more visible in the

minds of the consumers. Although it has been observed that the presence of a well-known personalhelps in solving the problem of over-communication that is becoming more prominent these days,

there are few undesirable impacts of this practice on the brand. The theories like 'Source CredibilityTheory, Source Attractiveness Theory and Meaning Transfer Theory' provide a basis on which the

methodology of celebrity endorsement works and also explains how the process of the celebrityendorsement influences the minds of the consumers. Firms invest huge amounts as advertising

expenditure for hiring the right celebrity. However there lies uncertainty with respect to the returnsthat the company might be able to garner for the brand. The issue of matching the values of the

celebrity with the brand values is also very important, i.e. getting the right celebrity to endorse theright brand. Consumers perceive the brand as having superior quality because it has been endorsed

a credible source. This makes endorsement as one of the indictors of quality for any brand. Corporacredibility along with endorser credibility plays a significant role in the attitude of the consumer

towards the brand and the advertisement respectively. On the other hand, the over popularity of th

celebrity sometimes overshadows the brand. If the celebrity is involved in multiple endorsements, ittends to create confusion among consumers and hence negatively affects the perception of the

advertisement and the brand. Hence, to say clearly whether the practice of celebrity endorsement

impacts positively or negatively to the brand still remains a debate.

Introduction

The society that we live in can not only be called secular or democratic, it should be moreappropriately termed as over-communicated these days. A typical super-market in USA displays mo

than 12000 brands, an American family has at least one television set and a consumer is exposed toaround 1000 ads per day1. Likewise, there are around 130 television channels in India broadcasting

over 3 million television commercials each year in India. The media-explosion can thus be easilydemonstrated. More over, people forget 80% of the information in just 24 hours! Just imagine the

plight of the marketer to make his brand shout over the deafening clutter of all the brands! Some

where in the 80's, Indian marketers found the solution, 'Celebrity Endorsement' for the brand!

Firms endorse celebrity for a variety of reasons. It might be the life experience of the celebrity that

the advertising message or the endorser's high appeal with the firm's consumer target group. Studiassociated with the market effect of celebrity endorsement suggest that consumers positively value

the use of celebrity endorsers in the advertisements. Firms invest significant money in putting

together brands and organisations with endorser qualities such as attractiveness, likeability, andtrustworthiness. But today's dynamic market conditions make these investments unviable. In this

paper we are attempting to discuss the positive and negative effects of celebrity endorsement with
mailto:[email protected]:[email protected]


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examples.

History

Celebrities are involved in endorsing activities since late nineteenth century2. The advent of celebrity

endorsements in advertising in India began when Hindi film and TV stars as well as sportspersonsbegan encroaching on a territory that was, until then, the exclusive domain of models 3. One of the f

sports endorsements in India was when Farokh Engineer became the first Indian cricketer to model

Bryl cream. The Indian cricket team now earns roughly Rs. 100 crore through endorsements. Therewas a spurt of advertising, featuring stars like Tabassum (Prestige Pressure Cookers), Jalal Agha (Pa

Parag), Kapil Dev (Palmolive Shaving Cream) and Sunil Gavaskar (Dinesh Suitings).

Mechanism and Theories of Celebrity Endorsement

Celebrity endorsements give a brand a touch of glamour and the hope that a famous face will providadded appeal and name recognition in a crowded market. In the battle for the mind, you get the

customer excited by showing him a known face, and an effective demand is created. In short it help

increase the recall value of the brand. A piece of research states that the target audience age group15-30 gets influenced first by cricketers, then Bollywood stars and only then music, festivals andfood4.

According to Source Credibility Theory5, acceptance of the message depends on 'Expertness' and

Trustworthiness' of the source. Expertness is defined as the perceived abilityof the source to makevalid assertions. Trustworthiness is defined as the perceived willingness of the source to make valid

assertions. Audience acceptance increases with the expertness of the source and the ability of the

audience to evaluate the product.

According to Source Attractiveness Theory,which is based on social psychological research, the

acceptance of the message depends on familiarity, likeability and similarity. Familiarity is the

audience's knowledge of the source through exposure; likeability is the affection for the source'sphysical appearance and behavior while similarity is the resemblance between source and receiver.This theory explains the message acceptance in two ways: Identification and Conditioning.

Identification is when the receiver or the target audience of the communication begins to identify wthe source's attractiveness, and hence tends to accept his opinions, beliefs, habits, attitudes etc. On

identification, a quote from Bijou Kurien, COO, Titan, "We decided on Aamir because we wantedsomeone who is a biticonic, who is style-conscious himself, and somebody who cuts across both sex

and age group, between urban and rural India. A celebrity who is mouldable and who is not over-exposed". Conditioning is when the attractiveness of the source is supposed to pass on to the brand

after regular association of the source with the brand.

Grant McCracken6 has criticized the previous two theories and proposed the Meaning Transfer TheorThe theory explains that a celebrity encodes a unique set of meanings which if well used can be

transferred to the endorsed product. Such a transfer takes place in three stages encoding meaninmeaning transfer, meaning capture (Figure 1).

I. Encoding Meanings: Each celebrity has a unique set of meanings, which can be listed by age,gender, race, wealth, personality or lifestyle. In this way, the celebrities encode a set of meanings i

their image. For example Preity Zinta can be seen as a lively, charming, bubbly, witty andenthusiastic.

II. Meaning Transfer: This stage transfers those meanings to the product. When skillfully portrayed,


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celebrities can communicate this image more powerfully than lay endorsers.

III. Meaning Capture: This assumes that consumers purchase products not merely for their function

value but also for their cultural and symbolic value. The theory says that consumers buy the endorsproduct with the intention of capturing some of the desirable meanings with which celebrities have

passed on to the product. This is more eminent in lifestyle products like clothes, perfumes, cell phonetc.

Discussion

Does celebrity endorsement really work? Theoretically yes, because the qualities associated with theendorser are associated with the brand and the brand therefore remains at the top of the consumer'

mind. However one needs to realize that the impact of an endorser cannot be sustainable in allproduct categories and in all the stages of brand life cycles. It really depends upon the type of produ

If it is a 'functional brand', then the product itself is the hero. Here any celebrity association with th

brand without corresponding performance of the product will not be sustainable. While incase of'image brands', like the categories of soaps, soft drinks, cigarettes etc., where it is difficult todistinguish between the products, celebrity endorsements help to distinguish between the brands at

emotional level. A research conducted by Synovate7, a global market research firm, revealed that 4

people would be more likely to buy a brand that was endorsed by their favorite celebrity.

Pepsi Co. has used a variety of celebrities including Aishwarya Rai, Hrithik Roshan, Amitabh BachchaKareena Kapoor, Rahul Khanna, Fardeen Khan, Sachin Tendulkar etc. Amongst advertisements

featuring celebrities, Pepsi tops the heap with the highest recall of 70%, while arch rival Coke is lowacross all markets with 52% recall. This proves that Pepsi has really exploited the use of celebrities

their advertisements and has worked8.

Hindustan Lever's 'Lux' soap in India has been using popular film actresses to endorse the soap sincits launch four decades ago implying that they owe their stunning looks to the brand. This consistenmessage hence reinforces the brand values and has been successfully able to position the soap righ

as the 'beauty soap'9 .

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, an HLL spokesperson says that it was too early togauge the success of 'Rin' in terms of sales and that though Dabur healthcare products' sales had

improved, the increase could not be solely attributed to him10. Similarly, there are also cases where


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there was a dramatic change in the sales figure after the endorsements. For example Rahul MalhotrAssociate Director Marketing, P&G India quotes "Certainly, it has helped us promote our brand 'Hea

Shoulders'. Last year, we were ranked as No. 2 and this year we are market leaders in this segmenwith over 45% market share".

D. Garg, Vice-President (Marketing), Dabur India Ltd quotes, "A celebrity does help in increasing brasales, but only if he/she is selected carefully and used effectively. The personality of the brand and

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

important."

Positive Impacts of Celebrity Endorsement on the Brand

Approval of a brand by a star fosters a sense of trust for that brand among the target audience. Thi

especially true in case of new product11. Celebrities ensure attention of the target group by breakingthe clutter of advertisements and making the advertisement and the brand more noticeable. A

celebrity's preference for a brand gives out a persuasive message and hence, because the celebrity benefiting from the brand, the consumer will also benefit. There is a demographic and psychograph

connection between the stars and their fans. Demographic connection establishes that different starappeal differently to 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 havuniversal appeal and therefore prove to be a good bet to generate interest among the masses.

Another invaluable benefit from celebrity endorsements is the public relation opportunities.

Dwane Hal Dean12 studied the effects of three extrinsic advertisement cues viz. third party

endorsement, event sponsorship and brand popularity on brand / manufacturer evaluation. It was

observed that endorsement significantly affected only product variables (quality and uniqueness) anone image variable (esteem). The third party endorsement hence may be perceived as a signal of

product quality.

Goldsmith et al.

13

assessed the impact of endorser and corporate credibility on attitude-toward-the-attitude-toward-the-brand, and purchase intentions. 152 adult consumers were surveyed who viewe

a fictitious advertisement for Mobil Oil Company. They rated the credibility of the ad's endorser, thecredibility of the company, and attitude-toward-the-ad (Aad), attitude-toward-the-brand (AB), and

purchase intentions. It was observed that endorser credibility had its strongest impact on Aad whilecorporate credibility had its strongest impact on AB. The findings suggest that corporate credibility

plays an important role in consumers' reactions to advertisements and brands, independent of theequally important role of endorser credibility.

Looking at the effect of celebrity endorsement on the wealth of a company a classic example ofMichael Jordan can be used. At the time of rumors of Michael Jordan returning to NBA in 1995, he w

endorsing products of General Mills (Wheaties), Mc'Donalds (Quarter Pounders, Value Meals), Nike (Jordan), Quaker Oats (Gatorade) and Sara Lee (Hans Underwear). Study conducted by Mathur et

al.14associated with Jordan's endorsements shows that the anticipation of Jordan's return to NBA, anthe related increased visibility for him resulted in increase in the market adjusted values of his clien

firms of almost 2 percent, or more than $1 bn in stock market value. From this study one can obser

that the major celebrity endorser with rumors or otherwise has a tremendous potential to influence profitability of endorsed products.

Semi-partial endorsement indicates that when a company uses famous characters from any TV soap

for brand endorsements, consumers tend to relate to the character that he or she plays in the soapand hence can attract more credibility. For example, Smriti Irani who plays 'Tulsi' in a famous soap


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has garnered a lot of support from the middle-class housewife today. If she would endorse a brand,there would be more relativity and credibility. Same can be said about Priya Tendulkar who used to

play the character of Rajani.

Negative impacts of Celebrity Endorsement on the brand

More often talked about is the extreme usage of a celebrity called 'lazy advertising', that is inadequa

content masked by usage of a celebrity15 . A good example is the use of Boris Becker by Siyaram an

Steve Waugh by ANP Sanmar. Also as said earlier, associating with a star, in itself does not guarantsales. There is also the fear of Brand-celebrity disconnect which points out that if the celebrity used

represents values that conflict with the brand values, the advertising would create conflict in the minof the target audience.

Clutter in brand endorsements is very prominent these days and such kind of over-exposure can bebad for the brand as the recall value drops by a huge margin. A popular drawback of celebrity

endorsement is the 'Vampire Effect' or the celebrity overshadowing the brand16. Some viewers forgethe brand that a celebrity is approving. Others are so spellbound by the personality of the celebrity

that they completely fail to notice the brand being advertised. Two new drawbacks can be seen thesdays what marketers call Celebrity Trap and Celebrity Credibility17. Celebrity trap is when the celebr

becomes an addiction for the marketing team and the task to find substitutes becomes more and mdifficult, leading to surfeit of celebrities. Celebrity credibility refers to skepticism by the consumers

regarding the celebrities, especially when there is anything negative regarding the celebrity associatwith the brand in the news, then brand is bound to be affected. For example, Air Jordan's generated

revenue sales of $130 million in the first year. The sales dropped miserably in the second year whenJordan missed 62 games due to a broken foot18. Another main worry of the advertisers is that their

celebrity endorser would get caught in a scandal or an embarrassing situation.

Multiple product endorsement also has a negative impact on customers' purchasing intentions. Tripp

al.19 investigated the effects of multiple product endorsement by celebrities on customers' attitudesand intentions. They found that the number of products a celebrity endorses negatively influences

consumer perception of the endorser and the advertising itself. It was suggested that when as manyas four products are endorsed, celebrity credibility and likeability, as well as attitude towards the ad

may attenuate.

Superstar Amitabh Bachchan endorses multiple brands like Pepsi, Mirinda, ICICI, BPL, Parker pens,

Nerolac, Dabur, Reid & Taylor, Maruti Versa, Hajmola, Tide, Cadbury and a few social messages. It worked in some cases, while in some cases it has not. D. K. Jain, Chairman and President, Luxor

Writing Instruments Pvt. Ltd, the marketer of the Parker brand said, "Using Amitabh Bachchan as obrand ambassador has helped in strengthening our brand image and recall within the target audienc

Tarun Joshi, Communications Custodian, Reid & Taylor said, "Amitabh Bachchan is an icon withuniversal appeal and has helped us to reach out to the real 'Bharat.' In fact, agents and retailers ha

told us that already customers have started asking about the 'Amitabh wali suiting.'" Incase of Nero

Paints, which was endorsed by Amitabh Bachchan, around 80% of the respondents when asked toassociate Bachchan with any paint, did so with Asian Paints, which is the biggest competitor ofNerolac20.

The budget or cost is an important factor for celebrity endorsement21. Depending on the status of th

celebrity, remuneration could run into millions of rupees for several years or may also include a pro

sharing plan. For example when S. Kumar's used Hrithik Roshan for their launch advertising forTamarind, they reckoned they spent 40 - 50 per cent less on media due to the sheer impact of usin

Hrithik. Sachin's endorsements got him $18 million over five years. When Aamir first endorsed Peps


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1995, he received Rs 17 lakh for it; his Coke commercials in 1999 got him Rs 2 crore. Hrithik Roshain his highflying days reportedly made over Rs. 20 crore in endorsements and events by 200122.

However, a number of brands have been built without celebrity endorsement. For some of theirbrands, Hindustan Lever and Procter & Gamble do not believe in celebrity endorsement because the

think that consumers, especially housewives, are more likely to identify with a lay person on screenthan a celebrity. Procter & Gamble launched its 'Rejoice' brand in India with testimonials from ordin

women in their TV advertising. Few more examples of this will be Lifebuoy, Wheel, Dettol, Close Up,

Fevicol etc.

Conclusion

Whether Celebrity endorsement has a positive or a negative impact on the brand is a debate that is

open to interpretation. But till the time the corporate world continues to foot fancy bills of celebrityendorsers and till consumers continue to be in awe of the stars, the party is not likely to break up.

References

1 Positioning: A battle for mind - Jack Trout and Al Ries

2 Erdogan (1999), "Celebrity Endorsement: A Literature Review", Journal of Marketing Research, 15

291-3143 www.thedayaftertomorrow.com

4 Hindu Business Line, 20035 Tellis, Effective Advertising: Understanding When, How, and Why Advertising works

6 McCracken, Grant (1989), "Who is the Celebrity Endorser?" Journal of Consumer Research, 16

(December), 310-321.7 www.synovate.com 2003

8 www.indiantelevision.com9 www.magindia.com

10 Business Standard, May 13, 200511 www.blonnet.com

12 Dean (1999), "Brand Endorsement, popularity, and Event Sponsorship as advertising cues affectconsumer Pre purchase attitude", Journal of Advertising, Volume XXVIII, Number 3, 1-12

13 Goldsmith, Lafferty and Newell (2000), "The Impact of Corporate Credibility and CelebrityCredibility on Consumer Reaction to Advertisements and Brands", Journal of Advertising, Volume XX

number 3, 43-5414 L. K. Marhur, I. Mathur and N. Rangan (1997) June, "The Wealth Effects Associated with a Celeb

Endorser: The Michael Jordan Phenomena", Journal of Advertising Research,15 www.blonnet.com

16 B. Zafer Erdogan, Michael J. Baker and Stephen Tag (2001) June, "Selecting Celebrity EndorsersThe Practitioner's Perspective", Journal of Advertising Research, 39-48

17 www.rediff.com article by Country head, O&M India

18 indiainfoline.com article 'Celebrity Endorsements in brands19 Tripp, Jensen and Carlson (1994) March, "The Effect of Multiple Product Endorsements byCelebrities on Consumers' Attitude and Intentions", Journal of Advertisement Research, Vol 20, 535

54720 www.magindia.com

21 Agrawal and Kamakura (1995) July, "The Economic worth of celebrity endorsers: An event study

analysis", Journal of Marketing, Vol 59, 56-6222 www.blonnet.com


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Impact of Celebrity Endorsements on Overall BrandMonday, June 14, 2010

By Neha Taleja

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This Paper has won Consolation Prize in the CoolAvenues' Paper-writing Competition -"In Search of Excellence" - for the Year 2005.

AbstractThis paper studies the impact of celebrity endorsements on brands. While the magnitude of the

impact of celebrity endorsement remains under the purview of gray spectacles, the paper establishes

reasoning to the impact of celebrity endorsements on brands.

The study delves into the learning of impact regions of celebrity endorsement and how they occur.

This paper rifles through the concept of celebrity endorsement and provides insights on what it is

and how the increasing number of endorsements throw a valid question to the consumers. Is there a

science behind the choice of these endorsers or is it just by the popularity measurement? What are

the reasons which lead to impact of celebrity endorsement on brands?

Through research and analysis, this paper emerges with a 14-point model which can be used as ablue-print criteria and can be used by brand managers for selecting celebrities, and capitalizes the

celebrity resource through 360 degree brand communication since our research proposes it as the

foundation brick of the impact of celebrity endorsement. Our study reveals that the impact of

celebrity endorsement is proportional to the 14 factors discussed in the model.
http://www.coolavenues.com/author/neha-talejahttp://www.coolavenues.com/forward?path=node%2F864http://www.coolavenues.com/print/mba-journal/marketing/impact-celebrity-endorsements-overall-brand-0?page=0%2C0http://www.coolavenues.com/printpdf/mba-journal/marketing/impact-celebrity-endorsements-overall-brand-0?page=0%2C0http://www.facebook.com/sharer.php?u=http%3A%2F%2Fwww.coolavenues.com%2Fmba-journal%2Fmarketing%2Fimpact-celebrity-endorsements-overall-brand-0%3Fpage%3D0%2C0&t=Impact%20of%20Celebrity%20Endorsements%20on%20Overall%20Brand%20%7C%20MAT%2C%20SNAP%2C%20XAT%2C%20CAT%202010&src=sphttp://www.google.com/buzz/post


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The success of a brand through celebrity endorsement is a cumulative of the following 14 attributes.

Greater the score of the below parameters greater are the chances of getting close to the desired

impact.

The paper also discusses the scope of celebrity endorsement and ends with few insights on celebrity

endorsement and its impact on brands.

Introduction

Businesses have long sought to distract and attract the attention of potential customers that live in a

world of ever-increasing commercial bombardment. Everyday consumers are exposed to thousands

of voices and images in magazines, newspapers, and on billboards, websites, radio and television.

Every brand attempts to steal at least a fraction of an unsuspecting person's time to inform him or

her of the amazing and different attributes of the product at hand. Because of the constant media

saturation that most people experience daily, they eventually become numb to the standard

marketing techniques. The challenge of the marketer is to find a hook that will hold the subject's

attention.

Also from a marketing communications (marcoms) perspective, it is vital that firms design strategiesthat help to underpin competitive differential advantage for the firm's product or services.

Accordingly, marcom activities back-up other elements in the marketing mix such as designing,

branding, packaging, pricing, and place decisions in order to attempt to create positive effects in the

minds of the consumers. In helping to achieve this, use of celebrity endorsers is a widely used

marcom strategy.

Companies invest large sums of money to align their brands and themselves with endorsers. Such

endorsers are seen as dynamic with both attractive and likeable qualities (Atkin and Block, 1983),

and companies plan that these qualities are transferred to products via marcom activities

(Langmeyer & Walker, 1991a, McCracken, 1989). Furthermore, because of their fame, celebrities

serve not only to create and maintain attention but also to achieve high recall rates for marcommessages in today's highly cluttered environments (Croft et al, 1996, Friedman and Friedman, 1979).

Initially, this strategy seems to be low risk / extra gain situation, but as with any dynamic marketing

strategy, there are potential hazards. Individuals can change and endorsement relations can sour.

But the impact of celebrity endorsements is evident and ample research has been done to prove the

same. This paper focuses on the domain zones of a brand where celebrity endorsements show

results, the impact regions are the platform for core reasons why marcom professionals choose to

pick up celebrity endorsement as a strategy.

Defining the Meaning & Scope of the Topic

Defining a 'Celebrity'

Celebrities are people who enjoy public recognition by a large share of a certain group of people.

Whereas attributes like attractiveness, extraordinary lifestyle or special skills are just examples and

specific common characteristics cannot be observed, it can be said that within a corresponding social

group, celebrities generally differ from the social norm and enjoy a high degree of public awareness.

The term Celebrity refers to an individual who is known to the public (actor, sports figure,

entertainer, etc.) for his or her achievements in areas other than that of the product class endorsed


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(Friedman and Friedman, 1979). This is true for classic forms of celebrities, like actors (e.g., Amitabh

Bachchan, Shahrukh Khan, Rani Mukherjee, Preity Zinta, Aamir Khan and Pierce Brosnan), models

(e.g., Mallaika Arora, Lisa Ray, Aishwarya Rai, Naomi Campbell, Gisele Buendchen, etc), sports

figures (e.g., Sachin Tendulkar, Zaheer Khan, Sourav Ganguly, Anna Kournikova, Michael

Schumacher, Steve Waugh, etc), entertainers (e.g., Cyrus Broacha, Oprah Winfrey, Conan O'Brien),

and pop-stars (e.g., Madonna, David Bowie) - but also for less obvious groups like businessmen (e.g.,Donald Trump, Bill Gates) or politicians.

Celebrities appear in public in different ways. First, they appear in public when fulfilling their

profession, e.g., Vishwanathan Anand, who plays chess in front of an audience. Furthermore,

celebrities appear in public by attending special celebrity events, e.g., award ceremonies,

inaugurations or world premieres of movies. In addition, they are present in news, fashion

magazines, and tabloids, which provide second source information on events and the 'private life' of

celebrities through mass-media channels (e.g., Smriti Irani being regularly featured in various

publications). Last but not least, celebrities act as spokes-people in advertising to promote products

and services, which is referred to celebrity endorsement.

'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), is useful, 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 purchaseintention.

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.

Difference Between Brand Ambassador & Brand Face

A Brand Ambassador would be one who is not only a spokesperson for the brand or is just appearing

as a testimonial for the brand's benefits. He/she is an integral part of the brand persona and helps to

build an emotionale, which goes beyond just appearing on TV commercials.

He takes up the cause of a Brand Champion and is associated with every aspect related with the

brand. What is more, there is a significant difference between making just an endorsement for say, a

shampoo or an automobile, and being that brand's alter ego. Both parties take the latter far more

seriously to the deal. So a brand ambassador would be involved in press releases, he/she would be

actively participating in any sales promotion, sporting the Brand all the while. For example, Fardeen

Khan is the brand ambassador for Provogue while he remains a brand face for Lux Body Wash.


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On the other hand, a Brand Face would be the current celebrity who is just used as a tool to increase

brand recall and is only appearing in the advertisement. It is usually seen that a brand face is a

temporary contract and is very short term at times. An example would be Sona Chandi

Chawanpryash using Sourav Ganguly for a while in its commercials. Brand faces are easily forgotten

and fades away with the campaign's end.

Spread of Celebrity Endorsement

Markets in which advertising coordinates consumer purchases, celebrity endorsements are more

likely chosen for products that have either of the following: -

High price-cost margins

Large potential customer pools

The need to coordinate across diverse sets of customers

Scope of Celebriity Endorsement

The use of testimonials by advertisers dates back to the 19th century when medicines were patented.

Firms have been juxtaposing their brands and themselves with celebrity endorsers (e.g., athletes,

actors) in the hope that celebrities may boost effectiveness of their marketing and/or corporate

communication attempts for at least a century. One of the early example is Queen Victoria's

endorsement of Cadbury's Cocoa (Sherman, 1985).

Three of humankind's greatest inventions (cinema, radio, and television) have extended the scope of

endorsement as an advertising technique. Today, use of celebrities as part of marketing

communications strategy is fairly common practice for major firms in supporting corporate or brandimagery.

It was not until the 1920s, however, that advertisers used famous people for product endorsements.

Actresses Joan Crawford, Clara Bow and Janet Gaynor were among the first celebrities to promote

products (Fox, 1984). At that time, the rationale given by advertising agencies for using celebrities

was "the spirit of emulation" (Fox, 1984, p.90). About a decade ago, one in three television

commercials used celebrities' endorsements (Business Week, 1978), and today this advertising

approach appeared to be on the increase across all media types (Sherman, 1985 and Levin, 1988).

Friedman et al. (1977) found that celebrities are featured in 15 percent of the prime-time television

commercials. In the United States, it was reported that about 20% of all television commercials

feature a famous person, and about 10% of the dollars spent on television advertising are used in

celebrity endorsement advertisements (Advertising Age, 1987; Sherman, 1985). Thus, celebrity

endorsement has become a prevalent form of advertising in United States (Agrawal and Kamakura,

1995) and elsewhere.

Today, the use of celebrity advertising for companies has become a trend and a perceived winning

formula of corporate image building and product marketing (Media, July-August 1997). This


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phenomenon is reflected by the recent market research findings that 8 out of 10 TV commercials

scoring the highest recall are those with celebrities' appearances (Media, Nov. 14, 1997).

Impact of Celebrity Endorsement

The concept of celebrity endorsement has become a rage in India as well, with every company trying

to rope in a brand ambassador of sorts for their brands.

The increasing number of endorsements throws a valid question to the consumers. Is there a science

behind the choice of these endorsers or is it just by the popularity measurement? What are the

reasons which lead to impact of celebrity endorsement on brands?

Through research and analysis, this paper develops a 14 point model, which can be used as a

blueprint criteria which can be used by brand managers for selecting celebrities, and capitalizes the

celebrity resource through 360 degree brand communication, since our research proposes it as the

foundation brick of the impact of celebrity endorsement. Our study reveals that the impact of

celebrity endorsement is proportional to the 14 factors discussed in the model.

The success of a brand through celebrity endorsement is a cumulative of the following 14 attributes.

Greater the score of the below parameters, greater are the chances of getting close to the desired

impact.


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Fit with the Advertising Idea

Marketers now seek to adopt 360 degree brand stewardship in which the brand sees no limits on the

number of contact points possible with a target consumer. Advertising ideas, thus, revolve around

this approach, and the celebrity endorsement decisions are made through these startegic motives.

One of the most successful celebrity endorsement campaign which reflects the fit between the brand

and the 360 degree advertising fit is Fardeen Khan and Provogue. Provogue's positioning in the

apparel market is of a young, active, party-going, attention-grabbing brand and so is Fardeen Khan.

The conjuction between the two has been immensely impactful and brand managers have utilised

this endorsement through 360 degree reinforcement. Provogue Lounge and extensive phased

insertions in print in selective publications reaching out to their target audience has made it as one of

the highest recalled celebrity endorsement.

Similarly, Richard Gere's recent endorsement for VISA in India has gained acclaim due to its

innovativeness and consumer connect. Brand marketers say that research reveals that Richard Gere


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was the most popular face across the Asia Pacific region, and would also fit into the persona of the

brand meeting their communication objective to enhance VISA's brand leadership and consumer

preference, and the motive to continue the "All it Takes" empowerment platform featuring

international celebrities.

Celebrity-Target Audience Match

Smriti Irani endorsing the WHO recommnded ORS Campaign in India. Indian mothers can associate

with Smriti Irani through the facets she projects on screen or in regular life which helps develop a

connect with the target audience since mothers medicate their children with ORS. The inserial

placement of the campaign in "Kyunki Saas Bhi Kabhi Bahu Thi" has won it an award from PR Week.

Similarly, Irfan Pathan endorsing Hero Cycles has gained the brand immense recall and embarked

through the positve association between the consumer and the brand.

Celebrity ValuesCelebrity branding is all about the transfer of the value from the person to the product he endorses or

stands for. There are two concerns here. The first is how long this could last. Can the person

maintain his popularity (i.e., his performance or status ranking)?

The lifecycle of celebrity popularity varies a lot. The second concern is his private life - personal

integrity. If he is implicated in any kind of scandal, that would ruin the brand. "Who would want to

use Michael Jackson to brand their product?" (brandchannel.com)

Tabu endorsing Tetra Packed Milk, Shabana Azmi campaigning for AIDS Awareness, Amitabh

Bachchan & Shahrukh Khan campaigning for Pulse Polio or Aishwarya Rai appearing in the Donate

Eyes campaign are few examples, which reflect the transfer of celebrity values to the brand, creatingan impact that generates recall.

Costs of Acquiring the Celebrity

Consequently, companies must have deep pockets to be able to afford the best available celebrities.

Recently, a newspaper report showed how cola firms had gone beyond their advertising budgets to

get the best celebrities. Small firms that use celebrities' services run greater risks if they invest large

amounts. Although nobody is willing to say exactly how much celebrities get paid, industry sources

say Sachin Tendulkar's price is believed to be between Rs. 2.0-2.5 crore per endorsement, and

musician A. R. Rehman, who had signed up with AirTel, is believed to have picked up Rs. 1.75 crore.

Film-star Hrithik Roshan was rumored to have picked up Rs. 2 crore for the Fly With Hrithik

campaign to push Close-Up, and Shahrukh Khan's rate seems to be between Rs. 2.5-3.0 crore.

Aishwarya Rai apparently picks up Rs. 1.25 crore for an endorsement and the Indian cricket captain

Saurav Ganguly is believed to get between Rs. 90 lakh to Rs. 1.5 crore, while film-star Aamir Khan

apparently makes Rs. 1.5 crore per endorsement.

Celebrity Regional Appeal Factors


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R. Madhavan endorsing Pepsi in southern India or Sachin Tendulkar endorsing in India are few

examples of how celebrities are chosen to reach out to target audiences for brands in regional

markets.

Another interesting example would be of Steve Waugh campaigning for Tourism Australia in India

since he was one of the popular celebrities from Australia and could carry the messge of Australia as

a tourist destination. Other celebrities like Kylie Minogue, Nicole Kidman from Australia can be

prospective endorsers for Brand Australia but not in the region of India.

Celebrity-Product Match

Cyrus Broacha is the brand ambassador for MTV since both the celebrity and the brand are

considered as friendly, young, mood-boosting, humourous and outspoken. MTV's brand personality

overlaps Cyrus Broacha's image as a brand.

Some more examples of compatible celebrity product match in which celebrity brand attributes gettransferred to the brand and increases the brand equity is of Mallaika Arora & Freshizza from Pizza

Hut, Govinda & Navratan Tel, Sanjay Dutt & Elf Oil, Sunny Deol & Lux Undergarments, Aishwarya

Rai & Nakshatra, etc.

Celebrity Controversy Risk

The perfect example here is of Salman Khan and the controversy in which he crushed a man to death

with his Pajero when he was driving under the influence of alcohol. Also, any act on the part of the

endorser that gives him a negative image among the audience and goes on to affect the brands

endorsed. The brand, in most instances, takes a bashing.

Celebrity Popularity

Celebrity Brand association like Garnier endorsed Tara Sharma & Simone Singh, Agni Diamonds &

Riama Sen don't get much brand recall, and even if they do, its difficult to attribute it to the

celebrities' endorsing the brand. On the other hand, HPCL has had increased popularity and share of

voice due to the endorsement of the brand through Sania Mirza.

Celebrity Availability

In case of various brands, there are situations in which they prefer to go without a brand face, since

there is no brand-fit between the celebrities available and the brand. Also, due to multiple

endorsements by certain celebrities, brands refuse to adopt celebrity endorsement since they fear

dilution of the brand image.

Celebrity Physical Attractiveness

Bipasha Basu' physical attractiveness and her connect with the brand makes Levis Strauss's

campaign through celebrity in India, John Abraham endorsing Wrangler and Timex Sunglasses are

some examples which portray the celebrities' physical attractiveness that helps create an impact.


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Celebrity Credibility

The most important aspect and reason for celebrity endorsement is credibility. In a research carried

out among 43 ad agencies and companies, most experts believed that the most important dimensions

of credibility are trustworthiness and prowess or expertise with regard to the recommended product

or service (Miciak and Shanklin, 2002). One of the most obvious reasons of Amitabh Bachchan

endorsing plethora of brands is the credibility of the celebrity and his recognition across consumers.

To site one of the most successful campaigns in which the celebrity's credibility has had an indelible

impact on the brand and has saved the brand is of Cadbury's. After the worm controversy, Amitabh

Bachchan's credibility infused into the brand through the campaign, helping it to get back on track.

The campaign has won an award for the same.

Multiple Endorsements

The case of multiple endorsements, both in terms of a single brand hiring multiple celebrities andthat of a single celebrity endorsing multiple brands, is often debated. At times, consumers do get

confused about the brand endorsed when a single celebrity endorses numerous brands. The recall

then gets reduced and reduces the popularity of the brand. Not many people can remember all the

brands that a celebrity endorses and the chances of losing brand recall increases if the celebrity

endorses multiple brands. For example, in case of Sachin Tendulkar people recall Pepsi, TVS Victor

and MRF, but might not remember brands like Britannia and Fiat. Similarly, for Amitabh Bachchan,

consumers remember ICICI, Pepsi, Parker Pens, Pulse Polio and BPL. They might get confused in

the endorsement of Nerolac or Asian Paints. Thus, for multiple endorsements where the same

celebrity endorses several brands, it boils down to the strength of the brand and the advertising

content.Whether Celebrity is a Brand User

One of the strongest platforms to discuss this is through NGOs. Various celebrities endorse NGOs

and social causes since they believe in the social message that they need to convey to the audience.

One of the most successful campaigns has been executed by PETA in which celebrities like Shilpa

Shetty, Amisha Patel, Yana Gupta, Sheetal Malhar, Mahima Choudhary claimed to believe in PETA's

philosophy, and thereby endorse the brand.

On the other hand, while some would understand that Amitabh Bachchan would have never used

Navratan Tel, the target audience that the brands wants to reach out to will be ready to believe that

he used the oil and his endorsement thereby creates an impact.

Impact Regions of Celebrity Endorsement

While brand marketers with positive experiences would tend to believe that celebrity endorsements

work and some would disagree, but one would be sure that the magnitude of its impact is difficult to

measure even if sales figures are at our disposal. However, we can understand why it works and the

impact regions of celebrity endorsement.


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The illustrations below explain the same: -

Source: Adopted from TOM et al, 1992.

How Celebrity Endorsements Influence the Consumer

The basis for the effectiveness of celebrity-endorsed advertising can be linked to Kelman's processes

of social influence as discussed by Friedman and Friedman. According to Kelman, there are three

processes of social influence, which result in an individual adopting the attitude advocated by the

communicator:

Compliance, Identification & Internalization

These latter two processes are particularly applicable to celebrity-endorsed advertising.

Compliance infers that another individual or group of individuals influences an individual cause he

or she hopes to achieve a favourable reaction from this other group. This process of social influence

is not directly applicable to celebrity advertising because there is little, if any, interaction between the

celebrity and the consumer.

Identification applies to the situation wherein the individuals emulate the attitudes or behaviour of

another person or group, simply because they aspire to be like that person or group. This process is

the basis for referent power. It was found that celebrities are more commonly liked than a typical

consumer spokesperson.

Internalization as a process of social influence is said to occur when individuals adopt the attitude or

behaviour of another person because that behaviour is viewed as honest and sincere and is congruent

with their value system. The effectiveness of celebrity advertising traditionally has not been strongly

linked to this process, as a celebrity's reason for promoting a product can just as easily be attributed

by the consumer to an external motive (i.e., payment of fee) as to an internal motive (i.e., the

celebrity's true belief in the value and benefit of the product). An important issue of concern relates

to the development of a strategy for use in Celebrity Advertising, which benefits from the dramatic


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impact of dual support of both the identification and internalization processes of social influence.

Celebrities are well-liked, but the techniques that can be used to enhance their credibility as

spokespeople, and therefore, tie-in more closely with the internalization process needs to be looked

into.

Effectiveness of Celebrity Endorsers

A study conducted by Charles Atkin and Martin Block focussed on alcohol advertising and young

audience to examine the impact of celebrity advertising in terms of social effects of advertising. The

sponsoring Company is the underlying source of any advertising message, but the individual models

depicted in the advertising serve as the more visible communicator in many cases. The most

thoroughly studied source quality is credibility. Research conducted by social psychologists over the

past 30 years demonstrates that a source perceived as highly credible is more persuasive than a low

credibility sender (Hovland and Weiss, 1951; McGuire, 1969; Hass, 1981).

The sources that companies use to present their advertising message typically attempts to project acredible image in terms of competence, trustworthiness or dynamism. Celebrity endorsers are

considered to be highly dynamic, with attractive and engaging personal qualities. Audience may also

trust the advice given by some famous person, and in certain cases, celebrities may even be perceived

as competent to discuss the product. Friedman, Termini and Washington cite a 1975 study showing

that celebrities are featured in 155 of prime-time TV commercials. A later survey reported that this

proportion was up to 20% (Advertising Age, 1978). The most widely used celebrities are sports

figures, actors or other types of entertainers. There are several reasons why a famous endorser may

be influential: -

They attract attention to the advertisement in the cluttered stream of messages They are perceived as being more entertaining

They are seen as trustworthy because of apparent lack of self-interest.

The final element is due to the wide-spread attribution that major stars do not really work for

the endorsement fee, but are motivated by genuine affection for the product (Kamen et al,

1975).

Despite the use of famous endorsers, there is little published evidence regarding effectiveness. In one

experiment, an advertisement for a fictitious brand of Sangria wine featured an endorsement

attributed to either a celebrity (actor - Al Pacino), a professional expert, the Company President, a

typical consumer and no source (Friedman, Termini and Washington, 1977). College students read

the ad and gave the ad 0-10 scales of believability, probable taste, and intent to purchase. Across

these three measures, the celebrity condition produced the highest scores.

While the 'no-source' control group had a purchase intention rating of 2.7, the subjects exposed to

the actor scored 3.9. Believability was rated 2.8 by control subjects versus 4.1 by those seeing the

celebrity endorsement. For taste, the baselines of 4.0 compares to the celebrity group score of 5.6.

None of the other three endorsers were as influential as the celebrated person.


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Brand Image Formation & Brand Preference

Having a congruent image between the brand and celebrity does not guarantee any positive effect on

consumers' brand preferences. The fundamental question is - what a brand image really does to

consumers? Baran and Blasko explained, "Since most products aren't special, most advertising does

all that so-called image stuff... There's no information about the product, there's only information

about the kind of people who might be inclined to use the product." (p.13). This view is echoed by

Feldwick (1991) who has suggested that the subjective experience of using a brand can be different

from the subjective experience of using an identical product without the brand reassurance. In the

case of using celebrity advertising to build brand image, the effects are examined with a social

psychological framework.

Decision Making Process & Purchase Decision

Decades ago, John Dewey (1910) conceptualised decision-process behavior as problem solving -

thoughtful, reasoned action focused on need satisfaction. As Ajzen and Fishbein (1980, p.5) put it,"Human beings are usually quite rational and make systematic use of the information available to

them... People consider the implications of their actions before they decide to engage or not to

engage in a given behavior." A lot of marketing research has shown that consumer decision follows

the sequence of need recognition, search for information, alternative evaluation, purchase, and then

outcome. The sequence can have major variations, however, from one situation to the next in terms

of the extent to which each of these steps is followed.

There are two types of decision-making processes defined. They include Extended Problem Solving

and Limited Problem Solving (Engel, Warshaw, Kinnear, 1991). In extended problem solving,

thinking leads to feeling, which leads to action. The very nature of the decision often necessitates

collection of information that is processed and stored. Various product attributes are weighed andevaluated.

In limited problem solving, consumers will simplify the process by sharply reducing the number and

variety of information sources and alternatives considered. The two problem solving processes above

suggest that brand images have a relatively insignificant impact on the consumer's purchase decision

if the product/service involves extended problem solving. On the contrary, the brand images of

product/service that involves limited problem solving will have a more significant impact on the

consumer's purchase decision.

The Power of Visibility

Most of us are invisible. Each of us has a small network of people who know us, in our workplace, our

neighbourhood, and our place of worship. It might be 50 people, 100, or 500 - a far cry from those

whose high visibility earns them the privilege to vacation on private islands, slip through side doors

at theatres, glide about in stretch limousines behind smoked glass, and book entire restaurants for an

undisturbed meal. For most of us, life rarely holds such pleasures. But as our power to distribute


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images expands, the ranks of the highly visible in society are growing rapidly, and those who

understand the transformation process utilize it to enhance their opportunities.

Conclusion

Through analysis and research, this paper brings forth the following insights: -

Celebrity endorsements do work in the Indian scenario. The level and the magnitude of the

effect vary with the celebrity and the product category but most endorsements have a

favourable impact.

The consumer looks for a variety of aspects from the endorsement like the credibility and

likeability of the endorser. Credibility also means the fit between the brand and the celebrity.

Multiple endorsements do clutter the minds of the consumer.

When one endorser endorses many brands, then the recall of the endorsement depends

entirely on the power of the brand. There are definitely some brands that go unnoticed and

the recall for those stands is at a bare minimum. The company in that case can heighten the

advertising content because that etches a special place in the mind space of the consumer.

It is not just the financial gains from the endorsements that matter to the celebrity. They also

look for the fit with the brand and what the endorsement might do to their image.

Professional performance of the endorser is important in deciding the success of the

endorsement. However, the bad performance should be stretched so as to make sense to the

audience.

More than the bad performance in the professional field, it is the association of the celebrity

with a controversy or ill-behaviour that causes negative impact to the endorsements. During

the match fixing scandal in India, the commercials featuring Ajay Jadeja and Mohammed

Azharuddin were all taken off air so that they did not have a negative effect on the brand.

The celebrities' accessibility, regional appeal factors, popularity, attractiveness, belief system

are some other important platforms, which are raised when we study the impact of celebrity

endorsement on brands.


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dessert at ion data

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