Relevant Concept Of Celebrity Endorsements Marketing Essay

Relevant Concept Of Celebrity Endorsements Marketing Essay Introduction In the introduction this research paper will be providing an insight about the research area. It would begin by briefly discussing the background and relevant concept of celebrity endorsements and how it affects the consumer pre-purchasing behavior. 1.1  Ã‚  Ã‚  Ã‚  Ã‚   Background Advertisement came into existence in early 18th Century. Since then the concept started playing an active role in the development of the society in the early 1930s.Most of the celebrity back then used their status in society to promote product, service or charity. These celebrities performed stage shows; modeling, sports activities and most of them were from movie industry (Kambitsis, Harahousouy, Theodorakis and Chatzibeis, 2002). In the early 19th century, worlds first celebrity endorser Lillie Langtry (British actress) appeared in the advertisement for pear soap. It marked the beginning of the brand representation by endorsers. These endorsers according to the Tellis (1998) can be divided into three major groups experts, lay endorsers and celebrities. Here experts are those people who know about the product and they have limited knowledge about the product which they have assembled during study, training or experiences. Such an instance can be shown in advertisement where dentist for toothpaste advert or nutritionists for healthy food items as both of them are able to provide an expert opinion about the product. Secondly lay endorsers are people who may be real or fictional, which resembles to the target groups and can be quite effective to provide message. Thirdly comes celebrity endorser who can be defined as the people who enjoys public recognition and who uses this on the behalf of a consumer good by appealing with it in an advertisement (McCracken, 1989, p.310). Celebrity endorsements are used for advertisement just because they can create an appeal and can increase its attractiveness for the viewers and consumers. For example Michael Jordan acted in advertisement for Nike; David Beckham for Gillette and newly made football cup advert of coca cola where Roger Millas celebrates wonderful world of football goals. According to Ohanian (1999) both theory and practice proves that the use of super stars in advertisements generates a lot of publicity as well as draws the attention of public. Most of the companies try to utilise the already made image of the celebrities to attract more customer base and increase their loyalty. As in this highly competitive business environment brand loyalty has become the utmost important for success. Companies use celebrities endorsement in the advertisements so that they are able to associate with celebrity and are able to cash there image for a long period of time. It is said that, If the consumers are able to see the link between the celebrity and the product then the endorsements can be highly effective (Hsu and McDonald, 2002). It is believed that attractive endorsers can be highly affective while promoting products and can be used to enhance consumers attractiveness. Attractive people have greater influences on the consumers compared to unattractive people (Till and Busler, 1998). Till (1998) states companies used celebrity endorsers either sporadically or opportunistically at the whim of the client or the agency. Paying back for the investments in the celebrity endorsement usually comes from using the celebrity regularly over time. The reputation strengthens the associative link for those consumers who were already aware of the celebrity endorsement. It also increases the pole of consumers who begins to make themselves aware of the link between the brand and the celebrity. Some marketers change celebrity endorsers very frequently which weakens the benefit expected to be derived from the endorser. Such as Nikes consistent use of Michael Jordon has encouraged customers to think about Nike when thinking about Jordon and vice versa these have shown that Nike and Jordon have become a part of each others association similarly association of the Nike and Tiger woods have made same impact as whenever customers think of golf products they think of the Tiger woods and its endorsed Nike product. McCracken (1989) proposed the hypothesis that endorsers are more effective when there is a fit between the endorser and the endorsed product. Byrne et al (2003, p.289) states celebrity can help the brand to rebuilt and even create a new identity with new dimensions. Celebrity endorsement boosts brands attractiveness among the consumers and saves valuable time in terms of creating the credibility. When consumers see a credible celebrity endorsing a product they think the company has to be good and reputed. The major job for the company is to choose the right kind of the celebrity for the endorsement and its the job of the advertisers within the company to match the companys image or product with the personality of the celebrity and characteristics of the target market to establish effective message and mass expectance. According to the Shimp (2003) two general attributes which are important when determining the effectiveness of the endorsers as well as the communications effectiveness are credibility and attractiveness. The first attribute concerns endorsers quality of being believable or trustworthy and the achievements and skills of the celebrity which could correlate with the brand image. The latter attribute refers to the celebrities ability to appeal, attract and engage large consumer base on the basis of their attractiveness. A good example of these would be golf star Tiger Woods whose scandalous image resulted in his ruining his credibility among the consumers which lead to his sponsors (ATT, Gillette, Tag Heuer and Accenture) dropping his advertisements and Anna Kournikova who although has never won any pro-level tournament but was still used by Swiss watch maker Omega to endorse their products because of her international reputation and appealing looks. Purpose and research questions Many of the previous studies on the celebrity endorsement have been focused on how celebrity endorsements influence consumer behavior. But there has been less consideration on the empirical   research on celebrity endorsement specifically on sport celebrity endorsements and in what manner do they use celebrity and how do they addresses the future returns on the investments in celebrities. The lack of proper research in this area inspires the present dissertation. So the main aim of this research would be to gain deeper understanding of the celebrity endorsement and how it influences the consumers behavior specifically in sports industry. To be able to achieve that following question were formulated: 1. Why does sports industry uses celebrity endorsements for promotional strategy? 2. How does celebrity endorsement affect the consumer behavior in sports industry? 3. How does company select the celebrity? 4. How effective are celebrity endorsement for sports industry? Demarcations This topic falls into the very broad area. Limits of both time and resources have led this research to focus on the very specific questions. Therefore the research paper will concentrate specifically on sports industry and will analyses the prominent companies in the field.   Furthermore there are several viewpoints which could be adapted in the research of the celebrity endorsement. There is consumers view point as they are affected by celebrity endorsement and then there is a companys point of view as they use celebrity endorsement as there promotional strategy. The research is done by keeping in mind that both points of views are highly important in understanding the consumer behavior as well as companys approach in promoting celebrity endorsement. Literature review This section of the research paper would be discussing what has already been done by other authors on the topic and their conclusion about the effect on consumer pre-purchasing decisions. Celebrity image is one of the major concerns for the endorser. Whichever company is endorsing celebrity the major issue they have to see is the compatibility between the celebrities and their brand. Advertising companies look for celebrities who compete and maintain an image (Kambitsis et al, 2002). Mostly companies are looking for the some basic properties such as likeability, expertise, trustworthiness and similarity thats what makes celebrity endorser to become a source of persuasive information and this creates a sense of certainty .Physical attractiveness of the endorser is also considerable and can be highly effective in producing an effective message. Acceptance of a message by a receiver could be influenced by celebrity endorsers as believable sources of information about a product or a firm (Amos et al, 2008). The use of celebrity endorsers to support products is explained by balance theory principles too. According to theory, successful companies establish an emotional rela tion between the observer and the endorser and a relation between endorser and brand too (Mowen, 2000). One of the important issue which arises here is whether there is a link between the consumers purchasing intention and celebrity endorsement. Many researchers have concluded that they have observed that many customers will pay a premium price for the product which have been endorsed by celebrities then product which have not been endorsed by celebrity. But the consumer should be able to see associations between the product and endorser as well as his/her intentions and purpose with the endorsers. The question that arises here is how does consumer associates itself with the celebrity endorser, to make a connection and association. It can be simply identified as most of the   companies choose an endorser who uses the product and where the use of the product is reflected due to endorsers professional expertise (Daneshvary and schwer, 2002). An athlete endorser such as David Beckham endorses football shoe then association can be seen but if he endorses golf products or racing car then customer will not be able to identify association. Therefore companies have to be very careful while associating with brand and product with the endorser so that they are able to utilize endorsers capabilities according to their need. Celebrity endorsement based on attractiveness is common among everyday consumers which, most of the time, effect consumers positively. Michael Jordon is an example of an attractive endorser but his effectiveness is likely greater when endorsing to this athletic ability is more rather than the products which are not relate to athletic performances. Consumers often have the positive effect towards the product and the celebrity despite the fact it is well known that the endorser earned a lot when promoting a product. (Cronley et al., 1999) Its more effective to use celebrity endorsement constantly to increase the strength of the link between the celebrity and the endorsed brand. Its also more effective to use celebrity who is not associated with another product (Till, 1998). When a Celebrity endorses only one or two products it is significantly more trustworthy than a celebrity who endorses even more products (Tripp at al., 1994). Celebrity endorsement can have both positive and negative effect on companys image e.g., many celebrities who switch their endorsement to the rival brands increase the risk of negative impact and confusion among the consumers. Pros and cons of celebrity endorsement Erdrogen (1999) states that academic findings and company reports safely argues that celebrity endorsers are more effective than non celebrity endorsers   when it comes to generate all desirable outcomes (attitudes towards advertisings and endorsed brands, intension to purchase and actual sales). Companies mostly utilize celebrities whose public image and personality match with product and the target audience and who have not endorsed previously. It has been clearly understood by the advertisers that celebrity endorsement has the significant potential to increase the recognition of the product and the brand. The increasing competition and new product increase in the market have made companies and marketers to use attention creating media stars to assist product marketing (Erdogan, 1999). With recent technology such as remote controlled televisions, video controlled systems, internet and satellite television, the power over programmed advertisements have increased and has made advertising more challenging. These threats with increased products, competition and technology development can be eased by the use of the celebrity endorsements as celebrity presence in the advertisement tend to   make impact on consumers reaction toward the advertisement and can help making advertising stand out from the clutter(Erdogan, 1999). Advertisers use celebrity to develop the communication between the consumers and the brand by cutting down excessive noise in the communication process. Some of the most complicated problem with the global marketing is to enter foreign countries due to cultural roadblocks such as time space, language relationships, a powerful risk, masculinity, femininity. And to overcome this problem companies hire local celebrities as they are powerful means to enter the foreign market. It makes it easier for companies to make the local people understand and associate the product with them. But it can also bring too many risks as well mostly because celebrities loss of credibility due to the frequently changes in endorsements or if celebrity drops in popularity. Therefore celebrity endorsement is a creative as well as risky tool for the companies. The whole process of celebrity endorsements needs a proper strategic plan before risking their investment.   Celebrity Endorsers Effect on consumers attitude Marketers and advertisers are particularly interested in consumers attitudes towards advertisements and brands. They always need to be aware of how sensitive consumers are about the adverts and brands. And they should know how do consumers start liking the product and consider it. It very much depends upon the consumers attitude towards certain product or brand or celebrity endorser. An attitude shows whether we like something or not. Attitudes have three basic components: affective, cognitive and behavioral. Affective component is related to our liking or feelings about an object. Cognitive is referred to beliefs about an object and behavioral component regards actions we take about that object (Severin and Tankard, 2001). Attitude towards advertisement is defined as a learned tendency to respond in a consistently desirable or undesirable approach toward advertisement in general (Haghirian, 2004). Determinants of advertisement consist of attitude towards the advertiser, assessment o f the advertising execution itself, the mood evoked by advertising and the extent to which the advertising affect viewers encouragement. A successful advertisement in one country or region is not necessary it will be successful in other parts of the world as what makes advertisement impressive will change noticeably in cross-culturally. Many researchers have concluded that the use of the celebrity endorsement in advertising creates constructive impact on attitudes of the consumer towards products and brands with which they are associated. Agarwal and Malhotra (2005) have defined brand attitude as consumers general evaluative judgment of a brand based on brand beliefs. Such beliefs concern product-related attributes, like practical and experimental benefits. A successful endorser is able to enhance intentions and preferences towards brands directly or indirectly. An endorser who has major source factors of credibility (like expertise, trustworthiness and effectiveness) is able to imp ress purchase intentions of the consumer considerably (Liu et al, 2007). Information from a credible source can impress ideas, attitudes and behaviour through a process called internalization(Belch and Belch, 1993).   Internalization occurs when the receiver is motivated to have an issue. The receiver learns and accepts the idea of the credible spokesperson, since he supposes that information of this person represents an accurate position on the issue. Therefore, if such spokesperson who is known to be an expert endorses a product, consumers will more probably have a desirable idea about that advertisement and brand and they will consider it in their shopping list the next time they go shopping. Researchers have used the identification process of social influence in order to explain the effectiveness of celebrity endorsers (Basil, 1996). This theory suggests that if an individual identifies with another individual, then he is more likely to accept an attitude or behavior of that individual or a group. The internalization process of social influence occurs when an individual accepts influence because the induced behavior is congruent with his value system. An individual accepts the influence, since it provides a solution to a problem (Daneshvary and Schwer, 2000) A successful endorser strategy can enhance the level of consumers recalling towards product information, reinforces consumers recognition to endorsed brands, positively influences consumers attitude to low-involved products and even enhance consumers purchase intention and preference towards brands (Liu et al, 2007) Celebrity endorsement and its involvement sports industry Sports industry is becoming the vital revenue generator in world economy and it is mainly due to increase in the broadcast coverage of important sporting events like Olympics, World Cup football, UEFA Cup, Wimbledon, US Open, Australian Open, French Open, Formula 1 racing, World Athletic meet, NBA and Basketball championship .Due to increase coverage sports persons have started becoming celebrities as more and more people know them and consider them as their idols. Sports celebrities have become major spectacles of todays media culture. Sports celebrities have been looked upon as role models from the todays young generation.   Most of the sports companies (Adidas, Nike, Wilson, Puma, Slazenger, Stiga, Dunlop and Yonex ) which have international recognition wants to have an international sport celebrity which is recognised by the most of their consumers and has enough credibility and attractiveness to appeal to large customer base. Due to which, Celebrity endorsements in the sport i ndustry continues to grow both in number and value. Certain athletes are utilized by brands as endorsers of their products because of the celebrity status gained by these athletes as a result of their success in their chosen sports. Most models of celebrity endorser effectiveness proposed by previous researchers have been based upon two basic models: the Source Credibility Model (Hovland, Janis, Kelley, 1953; Hovland Weiss, 1951) and the Source Attractiveness Model (McGuire, 1968). The Source Credibility Model significances that the effectiveness of the message is largely determined by the expertise and trustworthiness of the celebrity endorser, which offers explanations for why certain athlete endorsers such as highly successful mens tennis professionals Andre Agassi, Rafael Nadal, and Roger Federer could easily represent any brand of tennis equipment. In a different vein, the Source Attractiveness Model significances that similarity, familiarity, and liking of celebrity endorsers primarily determine their effectiveness, which attempts to explain why some athletes such as Manning, Woods, and racecar driver Dale Earnhardt Jr. can endorse brands in many different product categories. A general measure of physica l attractiveness has often been used to assess celebrity endorser effectiveness, assuming what is beautiful is good (Dion, Berscheid, Walster, 1972). However, mixed findings suggest that caution should be exercised in basing endorsement decisions on this model alone, since consumers perceive physical attractiveness differently. The Product Matchup Hypothesis (Forkan, 1980; Kahle Homer, 1985; Kamins, 1989; Kamins, 1990) emphasizes the need for a matchup, also referred to as congruency or fit, between the celebrity and the product. For example, the fit between Woods and Nike Golf is undeniable. However, according to sport marketing consultant Marc Cagins, Woods has failed as an endorser for Buick because of a lack of fit: People always shook their head as to why he did the deal anyway with Buick. If hes going to do a deal with GM, you would have thought Cadillac more than Buick (Thomaselli, 2008, p. 28).Research based on attractiveness matchup and expertise matchup has supported the hypothesis that celebrity/product fit remains critical to endorsement success. Kamins (1990) tested the matchup hypothesis based on attractiveness and found that the physical attractiveness of a source only mattered when an attractive source was paired with an attractiveness-related product, resulting in increased perceived source credibility and attitude toward the advertisement. Current examples would include the female tennis professionals and sisters Serena and Venus Williams Avon cosmetics campaign and the European mens soccer star Thierry Henry/Woods/Federer Gillette campaign. In a study examining the impact of gender and physical attractiveness on responses to motorsports sponsorships (Roy, Stewart, Goss, 2003), attractiveness played a greater role for female drivers than for male drivers, with the more attractive female drivers perceived as possessing greater expertise with products such as shampoo, tanning products, and dietary products. However, Bower and Landreth (2001) found that highly attractive models were not more effective than normally attractive models for problem-solving, attractiveness-related products and attributed these results to the premise that consumers perceive highly attractive models to have never faced an attractiveness-related problem and therefore have little expertise using these products. To illustrate, this premise would suggest that the current campaign utilizing female tennis star Serena Williams for ProActiv acne medication would be unsuccessful. However, a moderately attractive model may be more likely to be perceived to have faced an attractiveness-related problem and overcome it using the advertised product, fully illustrating the premise that the expertise of the source is more important than the attractiveness of the source.   Chapter 3 Methodology Research can be defined as the search for information or as any organized investigation to establish facts. There are two main types of research methods: quantitative and qualitative. Quantitative study uses numerical data to test hypothesis under investigation, which is flexible and objective. Qualitative study uses softer approach to look at perceptions and insights of people based on few samples but in great depth (Silverman, 2006) In quantitative research usually numerical data is collected through surveys.  So that they are able to observe surveys and develop it into the meaningful results. In quantitative research it is important to collect large sample to develop fairly accurate results, small the sample less chances to develop proper results. Qualitative Research Qualitative research helps in developing more meaningful complex researches. It has been characterized into four main approaches: they are observation, record, interpretation and conclusion. In qualitative research data is collected by focus groups or by interviews and then the data is observed thoroughly. Once observed data is collected or recorded in meaningful way so that it is able to be interpreted into understandable form. Then finally conclusion is constructed in a suitable way. Observational study has been criticized to be unreliable and subjective depending on observers understanding of the data. This form of research would be more appropriate at preliminary phase of research (Silverman, 2006). Researcher also uses other approaches to investigates, it is mostly done by reading of various materials on the subject to develop and recognize relevant information. This method of research is less common among qualitative research. Most common method among qualitative research is interviews and focus groups (Silverman, 2006). In interviews, participants respond to questions asked by researcher to investigate their understanding of the subject and allows respondent to elaborate further with his or her ideas and feelings. Focus group method is a more costly approach to carry out than methods mentioned, but often criticized for limited sample size which may not be representative of the population under investigation (Silverman, 2006) Research Method The purpose of this research seeks to investigate the insight and opinions of the consumers over the celebrity endorse and does it really affect the consumer behaviour during the purchasing. To support my research and to understand the consumer behaviour in depth survey will be conducted where common people/consumer from all walks of life and will be collected and interpreted into meaningful results and conclusion.   To understand the subject in the perception of the company interviews will be conducted with the people, who have understanding of the market and know how companies generate profits from the celebrity endorsement and what they make of celebrity endorsements effect on consumers attitude.   Primary Data Collection Primary data is information gather first-hand to contribute to what could be explored further into the research and also to justify. It involves collecting data using basic methods such as interviews, questionnaires, observations and abstractions. But the key point here is that the data collected should be unique and should not resemble with already done researches. The primary data, which is generated by the above methods, may be qualitative in nature (usually in the form of words) or quantitative (usually in the form of numbers or counts of items assessed). In this research both questionnaires and interviews are utilise so that   consumer behaviour could be understood fully from   both prospective consumer as well from companies.in this research questionnaire will have both open and closed ended questions so that prà ©cised options and answers could be obtained and it will be more accurate in interpreting the data. For the interviews, semi-structured pattern with open-ended qu estions will be develop in order to understand   interviewees opinion and belief about a particular matter or situation and not restrict respondents answer to confined questions. Semi-structured questions are used in this research to encourage respondent to elaborate on points they feel appropriate and provide a blueprint for them to understand the progression of the interview (Ruane, 2005). Although qualitative and quantitative data collection can be time consuming, but it is reasoned that this form of research provides more accurate results. Participants for survey are the common people whom answered to a posting on Facebook, tweeter and collage email. Participants for the interview are the managers of the different companies which have international experiences and have some sort of knowledge and understanding of the celebrity endorsements. Researcher carefully examined each participants position and company background to ensure they correspond to requirements of this research. The final participants were chosen upon their qualification and availability. Interviews were conducted personally in their respected office due to their availability in the London U.K .The time assumed for interviews were 20 to 30 minute but Interviews were longer than predicted, as participants were remarkably eager to elaborate their answers with personal experiences; each interview lasted about 30minutes to 60 minutes. 3.5 Limitations An extra care is need in preparing the questions for the interview and questionnaire as if researcher conducts the structure too loosely then it may lead to undesirable information making the result and concision less effective. Therefore structure of interview and questionnaire should be in a way that appropriate information is collected. Even semi-structured interview and questionnaire are criticized for possibility of missing information if researcher follows the structure too closely. Availability of the time restricted the research by creating the boundaries such as limited respondents for surveys as well as restricted participation of interviewers. The research was concluded in a limited time frame.