The Efficiency of Celebrity Endorsement as a Marketing Communication Strategy - Dissertation Example

?An Enquiry into the Efficiency of Celebrity Endorsement as a Marketing Communication Strategy in Modern Day Society Introduction: Commercial organizations have historically sought to seek attention of their customers through the use of attractive and innovative marketing techniques. In the contemporary world characterized by ever increasing competition to secure a substantial market share, marketers across the globe use eye-catching tactics to generate curiosity among the consumers and increase their brand awareness. As the significance of strategic product positioning and effective brand communication, has been realized and acknowledged within management circles, the use of celebrities for brand endorsements has today, become a relatively common phenomenon. Consumers are bombarded with advertisements featuring popular celebrities from various fields, thus exposing them to thousands of attractive images and voices – be it in print i.e. magazines, newspapers, billboards, or websites or through other audio-visual media such as radio and television. The use of celebrities for advertising has existed historically, but the trend has caught momentum and the use of celebrities for endorsing brands has increased substantially over the recent decades and is known to have a substantial and positive impact on a companies’ profitability (Erdogan, 2001). According to Shimp (2000) one out of four commercials on television on American television features a celebrity. The main aim of brands is to attract the attention of their prospective consumers and communicate information about their products to their target audience, by highlighting various attributes of their brand and associating the same with a popular celebrity. This paper aims to analyze, and understand the effectiveness of the use of celebrities for brand endorsements as a marketing strategy. Brief Background: The use of celebrities by companies for endorsing their products is not a recent phenomenon but in fact, the trend has existed ever since the late nineteenth century (Kaikati, 1987). The association of Queen Victoria with Cadbory’s Cocoa products substantiates the above stated claim (Sherman 1985). This trend gained further momentum with the advent of feature films and the innovations in technology leading to rapid improvement in the techniques used for product endorsement (McDonough, 1995). Figure 1: Royal Cocoa Advertisement, 1884 Although the use of celebrities was relatively less as compared to that witnessed in present times (Kaikati, 1987), as celebrities in those days were vary of associating with a brand and risking their credibility in the process. The late 1970s saw a sharp rise in the trend, where celebrities began to consent to associate with certain brands (Thompson, 1978). With the expansion of film industry and a simultaneous growth in the television sector, the number of celebrities rose substantially, and the avenues for advertisements too increased manifold, as the marketers now had an access to a wider variety of celebrities to choose from. The trend was similar in most of the countries across the globe. In UK for instance, according to a report published in a magazine (Marketing, 1996) the brands which featured celebrities as their key endorsers were quick to grab national headlines and gain instant popularity. The success of use of celebrities as brand ambassadors could be established from the fact that the amount offered to them crossed over one billion dollars. Such an offer was made mostly to athletes, owing to their fame and popularity among the consumers. Celebrity Endorsers: Meaning, Relevance and Significance It is common knowledge now, that most of the retail advertisements today feature celebrities (White et al., 2009). The term celebrity endorser includes all popular people from various fields such as films, sports, or artists and who have achieved significant success in their respective fields (James, 2004). According to McCracken (1989) the term celebrity endorser can be defined as "any individual who enjoys public cognition and who uses this cognition on behalf of a consumer by appearing wit in an advertisement". According to studies there is a strong relationship between the endorser and the observer, whereby the observer (in this case the consumers) associate attributes such as credibility, physical attractiveness, likeability, efficiency, expertise etc, with the celebrities endorsing the product, and are greatly influenced by the qualities possessed by the endorser, if the same fits their own tastes and preferences (Amos et al., 2008). Figure 2: Emma Watson featuring in a Burberry Advert. Emma Watson, hugely popularized by her role in the popular Harry Potter franchise attained instant recognition and fame among the young audiences. Her association with Burberry created a positive brand image in the minds of the prospective consumers making the strategy hugely successful. Owing to the huge positive response, she went on to become the ‘face of the brand’ in the year 2009. Here the likeability factor played a major role in creating a positive image in the minds of the consumers and influencing them to purchase the product. Figure 3: Madonna featuring in the Louis Vuitton Advert Louis Vuitton is a famous French fashion label known for its luxurious products including expensive and highly stylish leather goods such as shoes, watches, jewellery, sunglasses etc. It is one of the world's leaders in the field of fashion products. The association of Madonna with the brand helped the company in communicating its message – that of luxury and style to their consumers effectively, due to the star’s fame and popularity as a fashion icon herself. Despite her age, Madonna has retained her stylish looks and the same is used by the fashion house, in endorsing their products. Regardless to add, the promotional strategy worked wonders, and the advert was hugely successful among the consumers, garnering a positive response for the company. Celebrity endorsers are employed by firms for endorsing their products or services because their popularity among their fans, make their products noticeable and affect and influence the purchase decisions of the consumers (Amos et al., 2008; Erdogan, 1999; Kamins, 1990). According to Kaikati (1987), the use of celebrities for product endorsements entails several benefits for the brands such as increasing their brand visibility; enhancing their brand image and / or value; brand repositioning; or conveying a global brand image. According to Bauer & Greyser, (1968) consumers’ decision to purchase or reject a particular brand is deeply associated with the values they identify with it, such as likeable, annoying, pleasant or amusing etc. These values are enhanced and highlighted by the use of celebrities possessing similar attributes / qualities. Thus while making a purchase decision, the consumers take into consideration the qualities they find likeable or amusing in the celebrity who is used for endorsing the brand, and create a positive brand image regarding the product (Solomon, 2002). Furthermore, the use of celebrities for endorsing brands tends to enhance or improve the identity of the brand as consumers are easily able to identify the celeb. Celebrity endorsers possess certain key characteristics such as popularity, familiarity, likeability, reliability, skill etc., which make them an effective means of communicating the desired information to the consumers. The consumers in turn, are easily persuaded to purchase a product if it is endorsed by a celebrity they admire (Suranaa, 2008). Over and above such inner qualities, physical attributes of the celebrities also play a key role – both in endorsing a product and influencing the consumers’ choice and attitudes towards that product (Khatri, 2006). The consumers are often greatly influenced by the messages communicated by celebrities regarding a product due to the trust they have in them (Amos et al., 2008). According to Erdogan (1999) the likeability of a product depends heavily on the attitudes of the consumers towards the attributes of the celebrity endorsing it for instance, their physical attractiveness, or behaviour. Although most of the research aimed at studying the phenomenon reveal the effectiveness of such a strategy, there are however, several others, who have listed the flip side of the trend, suggesting that such a strategy may not always prove to be successful and may lead to significant losses and a bad reputation for the companies, on various accounts (Till and Shimp, 1998). Celebrity Endorsements in Nigeria: The trend of using celebrities for endorsing products is a global one, and is religiously followed by companies as an effective marketing strategy across the globe. In Nigeria, for instance, the trend had garnered instant popularity, as in other developed countries such as UK and U.S.A. Celebrities from various fields such as sportspersons and actors are increasingly being used to endorse both local as well as international products. In Nigeria, as opposed to the global trends, more than one celebrity is used to endorse the same brand, for instance, the brand Glo is endorsed by celebrities such as Jim Lyke, Ramsey Nouah, D'banj, Ini Edo, P-Square, etc and several others. Recently, Nigerian music stars are also being increasingly signed on to endorse popular local and national products. Figure 4: Popular Nigerian Actress endorsing a cosmetics brand (MUD) and dairy product brand (Luna milk) Counterview: Celebrity and non-celebrity endorsers In several cases companies choose non-celebrities over celebrities for endorsing their products. This is because the companies have a greater control over them and can use them in accordance with their brand strategies, to influence their target consumers. However, in case of established celebrities, they already have a strong image and identity of their own, and hence they come with certain characteristic traits which may not suit the brand or the values that the brand seeks to endorse (Tom et al., 1992). Studies have indicated that non-celebrities are also found to be equally successful in product endorsement, especially in creating an association with their consumers and influencing their purchase decision. According to the classical conditioning paradigm Ivan Pavlov, the consumers learn to associate between an unconditional stimulus i.e. an endorser / celebrity (in this case) and a conditional stimulus i.e. the product, through persistently communicating the same to them. Such an association, according to researchers is relatively stronger in case of non-celebrities rather than celebrities because, the celebrities possess various other attributes other than the one which the brand endorses and seeks to promote, and the same is known to the consumers (Lavond, Steinmetz, 2003). Irrespective of the numerous benefits discussed in the previous section, such a strategy involves considerable potential hazards. The prospective benefits likely to be accrued from the association of a celebrity with a brand, can be easily reversed, if there is a controversy, scandal or negative publicity related to the celebrity in question, leading to a sudden fall in his/her popularity. The drop in popularity can also be on account of over-endorsing products i.e. endorsing multiple products (Kaikati, 1987). Furthermore, studies have claimed that there is a direct relationship between the celebrity and the brand / products endorsed by them. Hence any fall in popularity of the celebrity on account of various reasons mentioned above, does not affect only the celebrity’s reputation or popularity but also significantly affects the popularity of the brand /product which is endorsed by them (Till and Shimp 1998). There are instances when the companies have suffered public humiliation on account to the acts of the stars associated with their brands (for instance Michael Jackson and Pepsi; OJ Simpson and Hertz Corporation). Another drawback of celebrity endorsement is the fact that due to the rising craze and hype surrounding such a strategy, celebrities often end up endorsing and promoting several products simultaneously. Such an act on the part of the celebrities, leads to a loss of credibility, as their face becomes far too common and the consumers lose trust in them, if every other product is endorsed by the same celebrity. The feeling of exclusivity is lost thus leading to a fall in their popularity especially with regard to their association with brands (Erdogan 1999). Various studies conducted by researchers to study the over exposure of celebrities with regard to brand endorsements observed that such an act on the part of the celebrities, leads to distraction among the consumers, who tend to start focusing more on the celebrity rather than the product attributes or the product itself (Erdogan, 1999). Furthermore, in some other studies, the consumers were observed to be highly cynical with regard to celebrities who endorsed too many products, and also regarding the fact that they are actually paid to offer positive information regarding the brands they endorse. According to such consumers, the celebrities if paid for such an act, are naturally expected to release only positive information and hence they lose their credibility, as their natural and honest reaction towards the product is not released to the consumers. According to yet another study, conducted by Till and Shimp (1998) it was observed that consumers take the association / relationship between the brand and the celebrity very seriously, and hence any negative publicity garnered by the celebrity makes them question the credibility of the product as well. Thus, although there are various advantages of celebrity endorsements, it also has a flip side to it, which entails millions of dollars worth of losses, as well as negative publicity for the brand, which various marketers cannot afford. Thus to conclude it can be stated that celebrity endorsements are expensive – not monetarily but with regard to the cost the companies might have to bear with regard to dealing with negative image / perception of the brand / product in the minds of the consumers. Thus the moral price is higher than what most of the marketers can afford. Besides, despite paying high price for the celebrities to endorse their brands, the success is not always guaranteed. Theoretical Perspectives: The impact of celebrity endorsement as a marketing strategy can be viewed by way of various theoretical perspectives. The theories that best describe the association between the celebrity and the consumer as well as the product, include: Celebrity Endorsement Theory According to this theory, The endorsement process requires a spokesperson who communicates the meaning and message of the brand to the target audience and based on the images communicated by the endorser to the consumers the consumers, interpret a message and ascertain whether it is beneficial to them or not. Thus it is quite apparent that the main role of the endorser is to effectively communicate the usefulness of the product, to the target audience in order to ensure that the message is interpreted favourably by the consumers and the same is converted into a final purchase decision. The use of celebrities for endorsing the brand makes it all the more easier for the marketers to communicate their messages, as the celebrities have a good public image, and are recognized across all regions, by a wide number of consumers. Thus, they already have an image and a certain level of credibility, in the minds of the consumers. In such a case, when they choose to endorse a brand, or a product, the consumers can quickly interpret the message which the endorser are trying to communicate and are convinced / influenced to buy the same (Friedman, 19791; Atkin and Block, 19832; Walker, 19923). The theory of Meaning transfer: According to this theory the success or effectiveness of the message conveyed by the endorsement is ascertained by the meanings as perceived or interpreted by the consumers, who then associate the same with the endorser and eventually transfer the same to the brand / product (McCracken, 19894). According to a study carried out by Kambitsis (20025) it was observed that the products endorsed by athletes are highly successful, as their characteristics or personality traits are easily and widely identified by the consumers and the same can play an important role in influencing the purchase decisions of their target groups. Figure: meaning transfer in the endorsement process Source: McCracken (1989) The theory states that the fundamental objective of the marketers is to suggest a message or create an image of the product by associating it with objects, people or specific contexts with a view to make the message being conveyed, more apparent and clear. The effectiveness of the product, hence is largely dependent on the message it conveys, and as is interpreted by the consumers. Celebrities develop their own individual personalities or image over a period of time, and have a specific image in the minds of the consumers. Thus when a celebrity is used for endorsing a certain brand, the meanings associated with their image are naturally transferred to the product, subconsiously, by the consumer and associate the personality or image of the celebrity with that of the product or brand itself. This is why the marketers must focus on choosing an appropriate celebrity for the brand, and ensure that there is a fit between the celebrity and the brand they endorse. Furthermore, if there is no match between the product and the celebrity used for endorsing the brand, the consumers might shy away from using their product, as they might not like to associate themselves with a brand endorsed by that particular celebrity as they perceive that using that product would lead to transferring of the celebrity’s image to them, and they might not want to associate themselves with that celebrity, hence choose to turn down the brand altogether. Similarly, in case of a perfect match between the celebrity and the brand, the consumers will transfer the meaning of the message conveyed through the advertisement and associate it with the image of the celebrity and if considered favourable by them, they may choose to buy the product. The balance theory of attitudes: This theory developed by Fritz Heider, suggests that the consumers tend to like a product instinctively if the same is endorsed by their favourite celebrity. Here there is a three way relationship between the celebrity, the brand, and the consumers. According to this theory, there must be a balance between all the three dimensions of this three dimensional relationship (Issac, 20006). This theory is based on three elements: - the consumers, who receive the information being tranmistted to them - the endorser, who communicates the information to the consumer and - the product, about which information is being communicated The degree to which the consumers believe the celebrities plays a key role in influencing their attitudes towards the products. A balance is maintained between these three elements, and the association between all of them is positive, for instance: A likes B, B likes C, hence A should like C. Such balanced relationships are learned quickly and have a greater recall value and are rated as pleasant by the consumers. The theory also posits that the consumers do not like an imbalanced triad, i.e. where the relationship between all or either of the three elements is negative, for instance, A does not like B, and B does not like C, while C does not like A or one of them like the other element but not the other two. Such imbalanced relationships create negative emotions in the minds of the consumers and these negative emotions are then sought to be removed or eliminated by the brand. For instance, after the Tiger Woods scandal, various consumers renounced the use of the brands endorsed by him, such as Nike, as his scandalous relationships created a negative image in the minds of the consumers, and they did not want to associate themselves with a product which was endorsed by Woods (Kardes et al., 20107). On the basis of the studies conducted by researchers, they have claimed that: Celebrity endorsement should be avoided by brands as much as possible, and instead focus their strengths on using non-celebrities and create an independent brand image. There are chances that the repeated exposure of a celebrity might tarnish the image of both the celebrity as well as the brand, hence the celebrity who is so far regarded as an asset to the company might turn out to be a liability instead. If the celebrity and the brand are a misfit, i.e. there is no match between the attributes of the celebrity and the brand, then the celebrity might end up overshadowing the product entirely thus taking away all the attention and leaving the brand unrecognized and hence no recall value for the consumers. Over exposure of the celebrity would lead to a fall in the value of the celebrity in the eyes of the consumers and there would not be any impact of the association of celebrity and the brand. If the celebrity is inconsistent, with regard to their body of work or their achievements related to their field, it may in fact affect the product / brand negatively. Figure 5: Classical conditioning paradigm in marketing communications context Source: Tom et al., (1992) The association between non-celebrities and the brand is stronger than that between the celebrities and the brand. According to studies conducted by Mehta (1994) no significant differences were observed between the brand preference of consumers towards a product endorsed by a celebrity and those endorsed by a non-celebrity. The consumers, mainly focused on the brand attributes when it was endorsed by non-celebrities, and when celebrities were used to endorse a brand, the consumers focused on the advertising and the manner in which the product is promoted. There are contradictions in the opinions presented by researchers, regarding the preference of consumers towards products endorsed by non-celebrities. For instance contrary to the study conducted by Mehta (1994), another similar study conducted by Atkin & Block (1983) and Petty et al., (1983), observed that the consumers showed higher preference for products endorsed by celebrities as compared to those endorsed by non-celebrities. Another study was conducted by Agrawal and Kamakura (1995) and Mathur, et al., (1997) to assess the effectiveness of celebrity endorsement in increasing the profitability of the companies. It was observed that celebrity endorsements indeed were most effective in driving revenues and increasing sales, as such products (i.e. those endorsed by celebrities) were preferred largely by the consumers as compared to those endorsed by non-celebrities. According to Gabor et al., (1987), there are instances when a brand which is endorsed by celebrities is often faced with negative consequences due to any untoward incident related to the celebrity endorsing the brand, or there is no fit between the brand and the celebrity. For instance, in the case of Michael Jackson, who was assigned as a brand ambassador for a famous international brand, Pepsi Co., did not work out well, and failed to register with the consumers, mostly because of the alleged child molestation charges imposed on the star. The incident garnered huge negative publicity and a public outrage, leading to a drop in popularity of the celebrity himself. An association of a brand with such a celebrity thus, is likely to turn disastrous, owing to the circumstances. However, despite such an incident and the association between the brand and the celebrity, the company still managed to earn decent amount of profits and in fact recorded an 8 per cent increase in its sales within the very first year of such association. Such a rise in sales was highly impressive, given the fact that a mere 1 per cent rise translates into millions of dollars worth of revenues. Effectiveness and impact: The continuous influx of new entrants in the market and the rise in globalization has heightened the competitive environment. Marketers today, thus are required to be highly innovative and aggressive in their marketing campaigns. The development and popularity of media – print, as well as audio visual medium, and the recent addition to the list, the social networking sites, in all has further given rise to a new culture leading to further popularizing of the celebrity culture. Reality shows aired on television is now acting as a platform for commoners to showcase their skills and popular networking channels such as youtube, are further adding to the celebrity mania among the consumers. The marketers thus, are heavily cashing in on the trend, by using celebrities for endorsing their brand and lending a personality to it. The use of celebrities in advertising has helped advertisers and marketers in conveying a strong message regarding the product’s values and attributes and thus, creates a strong and positive brand image in the minds of the consumers. Furthermore the popularity of the celebrities used for endorsing the products, ensures a greater recall value and helps the consumers in identifying the product as well as its key attributes, thus influencing their purchase decision. Also, products endorsed by celebrities creates a better impression and stands out from the various miscellaneous products, which are endorsed by non-celebrities and thus helps in improving its visibility on shelf (Sherman, 1985). The use of celebrities in endorsing a particular product, helps in strengthening and repositioning a product. For instance, in cases where the image of the product is somehow, destroyed due to any incident or accident in the past, hiring a popular face for the brand, which has a good social standing, can help the companies in resurrecting their brand, and re-launch it with an improved image. The association of a celebrity with such a brand helps the consumers in trusting the product, due to their association with the attributes / characteristics of the celebrities. The credibility, expertise and persona of the celebrity is hence, easily transferred to the brand, by the consumers, thus influencing them to buy the product (Dickenson, 1996). Also it has been observed that in some cases the initial strategies followed by companies fail to garner desired attention for the brand / product, leading to a lack lustre response from the consumers. Such products fail to register their presence in the consumers’ minds, and hence are mostly ignored by them. The use of celebrities in such cases ensures almost instant popularity and recognition for both the brand as well as the product, as celebrities are highly popular among their fans, and their activities are religiously followed by them. The association of celebrities with such brands generates curiosity among the consumers regarding the product endorsed by them and makes the product identifiable, thus leading to a positive response from the consumers. Conclusion: Endorsement is as observed from the above discussions is a highly effective channel of brand promotion and one of the most favourite marketing strategies employed by the management to generate positive response from the consumers regarding their brand. The association of the celebrities to the brand leads to association of the celebrities’ attributes / characteristics being transferred to the brand, thus creating a brand image in the process. Such brand image linked the celebrity’s personality or personal traits, helps in creating a high stature for the brand in the society. In an industry which is flooded with substitute products, be it local, regional, national or international products – the use of celebrities help in leveraging the brand’s products and helps in product differentiation. Although there are various complications involved with respect to such an association (that between the celebrity and the brand), the positives or the benefits it entails far outweigh such drawbacks. The fact that celebrities have huge fan following across the globe, and are held in high esteem by the consumers cannot be denied. They are hence the best choice in communicating the brand’s attributes, as their own characteristics are recognized and acknowledged by the consumers and hence while making a product decision / choice, the consumers lay high trust on the celebrity. Regardless of the consequences, the trend of celebrity endorsement is a highly lucrative marketing strategy for the marketers and companies alike, and the phenomenon is here to stay, for a long time to come. References: Amos, C., Holmes, G., & Strutton, D. (2008). Exploring the relationship between celebrity endorser effects and advertising effectiveness: A quantitative synthesis of effect size. International Journal of Advertising, 27(2), 209-234. Bauer, R. A. and Greyser, S. A. (1968). “Advertising in America: The Consumer View”. Boston: Harvard University. Dickenson, N., (1996). Can celebrities ruin a launch, Campaign (May, 3), Pp. 24 Erdogan, B.Z., Baker, M.J. and Tagg, S. (2001), “Selecting celebrity endorsers: the practitioner’s perspective”, Journal of Advertising Research, Vol. 41 No. 3, pp. 39-48. Erdogan, B. Z., “Celebrity Endorsement: A Literature Review”, Journal of Marketing Management; May 1999, Vol. 15, Issue 4, p291-314 Gabor, A., Thorton, J., Wienner, D. P., (1987). Star turns that can turn star crossed, U.S. News and World Report (Dec, 7), Pp. 57 James, M.s. (2004), “The Use of Celebrities in Advertising High Teach Productcts: Technology Associations Impact on Advertising Effectiveness”, Doctoral Dissertation, George Washington University. Kaikati, J. G. (1987), "Celebrity Advertising: A Review and Synthesis."International Journal of Advertising, 6, No.2, pp.93-105. Kamins, M.A. (1990), “An investigation into the ‘match-up’ hypothesis in celebrity advertising: when beauty may be only skin deep”, Journal of Advertising, Vol. 19 No. 1, pp. 4-13. Khatri, P. (2006), “Celebrity Endorsement: A Strategic Promotion Perspective”, Indian Media Studies Journal Vol.1 No.1. July-Dec. Lavond, D. G., Steinmetz, J. E., (2003). Handbook of classical conditioning, Springer Publishers, Pp. 5-20 Marketing (1996), "Sex and Stars Put Ads In: News," Marketing, (Feb. 1), p.7. McCracken, Grant (1989), "Who is the Celebrity Endorser? Cultural Foundation of the Endorsement Process," journal of Consumer Research, 16 December pp.310-321. McDonough, J. (1995), "Bringing Brands to Life," Advertising Age, Special Collectors Edition, Spring, pp.34-35 Mehta, .A., (1994), "How Advertising Response Modeling (ARM) Can Increase Ad Effectiveness," journal of Advertising Research, 34, No 3 pp 62-74. Shimp, T. E. (1997), Advertising. Promotion and Supplemental Aspects of Integrated Marketing Communication, 4th Edition. Fort Worth, Texas: The Dryden Press. Sherman, S. P. (1985), "When You Wish Upon a Star," Fortune, (August 19), pp.66-71. Soloman, M.R (2002), “Conumser Behaviour: Buying, Having and Being”, 5th ed., New Jersey: Prentice Hall. Surana, R. (2008), “The Effectiveness of Celebrity Endorsement in India”, A dissertation presented in part consideration for the degree of MA in Marketing. Thompson, J. R (1978), "Celebrities Strike it Big as Endorsers," Industrial Marketing. (January). p.85. Till, B.D. and Shimp, T.A. (1998), “Endorsers in advertising: the case of negative celebrity information”, Journal of Advertising, Vol. 27 No. 1, pp. 67-82. Tom, Gail, Clark, Rebecca, Elmer, Laura, Grech, Edward, Masetti, Joseph, and Sandhar, Hamiona (1992), The Use of Created versus Celebrity Spokesperson in Advertisements," The Joumal of Consumer Mariieting 9 No.4, pp.45-51. White, D.W, Goddard L. and Wilbur, N. (2009), “The effects of negative information transference in the celebrity endorsement relationship”, International Journal of Retail & Distribution Management, Vol. 37 No. 4, pp. 322-335. Read More