The Role of Celebrity Endorsement in Marketing Communication - Literature review Example

What is the role of “celebrity endorsement in marketing communication? Contents 3 Literary Review: Celebrity Endorsements and marketing communication plan 3 Critical Analysis: Role of celebrity endorsement in integrated marketing communication 5 Commentary 7 Conclusion 8 References 10 Abstract The endorsement of the products and services by the celebrities has created positive impression among the customer groups that the company is a growing business. The customers of today take informed decision by carrying out research on the products offered by the competitors in the market. The market players have, therefore, adopted strategic marketing techniques through adoption of celebrity endorsement approach in order to create brand equity in the market. The role of the celebrity endorsement in the integrated marketing communication plan has been commented in the light of several advantages and disadvantages of the aspect. This paper presents a review of the literature followed by a critical analysis and commentary on the role of celebrity endorsement in marketing communication plans and the extent to which celebrity endorsement approach has been able to attain the underlying goals of the business. Literary Review: Celebrity Endorsements and marketing communication plan The review of historical facts reveal that the people in the professions of art and culture, sports and public events have attained the status of celebrity by virtue of their performance that entertained the public and touched their hearts. It was during the start of the twentieth century that the status of celebrity of the well known figures in various professional fields started to diffuse in the societies and influenced their livelihood. The business sector and the industries viewed this trend of celebrity impact on the society as useful opportunities that could positively impact the growth of their business (Shimp and Andrews, 2013, p.47). The funnel approach in developing marketing communication plan by the companies took into consideration the various factors like awareness, interest, consideration, intent and evaluation by the customers that influences the decision making for purchase of the products and services. The impact of the celebrity image and the fan following aspect was identified to be a useful factor that could boost the marketing and selling of the products and services (Silvera and Austad, 2004, p.1515). The review of the literature reveals that from the time of 1970s to 1990s the economies in the Asia Pacific, South Asia, disintegrated Soviet Union started to undertake economic reforms that led to the process of globalization and the increase in international competition in the various sectors of business (Byrne, Whitehead and Breen, 2003, p.288). In order to take strategic measures for market penetration, sustenance of market share and retention of customers, the business houses prepared integrated marketing communication plan for spreading awareness of the products and services offered, developing consideration and intent among the customers to evaluate the products for taking decisions of purchase. This funnel approach could be addressed by celebrity endorsement technique which was adopted by the companies for advertising and promoting the products and services. The marketing communication plan for celebrity endorsement that has been adopted by various companies at different point of time in their business could also be explained very well with the help of marketing theory on segmentation, targeting and positioning (Abrams and Abrams, 2003, p.78). The marketing communication plan developed by the companies takes into consideration the various factors like the nature of business, the demands from the markets, the aspects or the information to be communicated to the customers in terms of quality, durability, efficiency, guarantee, etc (Aaker and Keller, 1990, p.31). Based on these factors, the celebrities are selected by the companies as appropriate ambassadors for endorsing their products and services. As the celebrities are followed by large sections of the society, it has become easier for the companies to communicate the business message top their customers (Agrawal and Kamakura, 1995, p.56). The companies have undertaken large expenditures for celebrity endorsement in the form of contracts with the celebrities under which they have paid the amounts to the celebrities under the terms and condition of the agreement for endorsing their products. The review of the literature suggests that after the initial stages of segmentation and targeting, the promotion of the products with the help of celebrity endorsements have been effective in communicating the business message to the customers (Erdogan, 1999, p.295). The celebrity endorsements have played an effective role in position of the products and services in the market. Critical Analysis: Role of celebrity endorsement in integrated marketing communication The secondary research on the topic revealed that the companies have adopted the strategy of celebrity endorsement in order to promote the features of reliability, durability, guaranteed performance of their products and services (Hutt and Speh, 2012, p.71). The celebrities have distinct images of being rough and tough, efficient performer, trustworthy in terms of performance output in their respective fields which have given rise to a sense of reliability among the public. The celebrities have been selected by the companies depending on the message they desired to communicate to their customers for the spread of awareness, consideration and influencing the intent of purchase of products offered to the market. The approach of celebrity endorsement as a part of their integrated marketing communication plan led to positive influence on the purchasing decision taken by the customers (Jenster, Hayes and Smith, 2005, p.25). Due to the endorsements of the products and the services of the companies through the hands of the celebrities, the businesses have been able to generate a trust worthy image in the market which has supported their commitment of excellence in products and service delivery to the customers (McLoughlin and Aaker, 2010, p.62). The businesses that have undertaken the marketing communication plan of celebrity endorsement have been able to generate a sense of credibility among the customers in the highly competitive market. On the other hand, the companies that have not undertaken this strategy have been laggards in advertising and promoting the products and services of their business. The secondary research revealed that the celebrities have charged image rights for endorsing the products and services of the business which have led to increase in market share of the companies. The endorsement of the products has become attractive as and when the celebrities have endorsed them to the customers. The use of entertainment and media channels, televisions and internet have fostered the growth of celebrity endorsements as these strategies led to the wide spread communication to customers all over the world (OaShaughnessy, 1995, p.39). The reliable, high performing and the cost effective image of the products developed by the companies in the eyes of their customers have led to the increasing market share of their products (Röderstein, 2005, p.56). This has not only helped in achieving the marketing goals of the company but has also improved the efficiency of the business functions. Due to the role played by the celebrities in influencing the customers in taking decisions for using their products and services. The business houses have been able to generate brand equity of the company over a period of time. This has been certainly helped by the efficient operations of the business departments that have fulfilled the commitment of the business that are endorsed by the celebrities (Salwen and Stacks, 1996, p.95). The celebrity endorsements have directly impacted the brand image of the business in the communities. The brand loyalty of the customers has been developed due to the endorsement of the celebrities. The customers have responded over the years to the brand image created by the celebrity endorsement and the performance of the company in supporting the commitments to the customers (Schultz, Tannenbaum and Lauterborn, 1993, p.28). This has led to the growth of the business in the long run and helped the businesses to attain sustainability in the industry. Commentary The markets all over the world have undergone rapid changes due to the advent of globalization. The lifestyle, habits and the demands of the customers for products and services, the demand for added services have changed in the recent past. The use of media and television channels for the purpose of advertisement and promotion have witnessed a parallel growth of the social medias being used by the companies for marketing communication to the customers. The celebrity endorsements are also displayed through the use of social networking channels. This has led to the selection of international celebrities. Thus the companies have widened their approach of selecting internationally recognised ambassadors against national celebrities in order to address the global customers (Choia, Leea and Kim, 2005, p.98). The guarantees endorsed by the celebrities have created the impression of receiving the quality and guaranteed products and services. Thus the customers were able to realize the value to be obtained against the money spent in purchasing the products offered by the companies (Coade, 1997, p.75). The companies that have not undertaken the approach of celebrity endorsements are likely to lose comparative grounds in the efforts of promoting their products and services to the customers. Also the prices, quality and the performance endorsed by the celebrities back the decision of purchase of the customers (Cutlip, Center and Broom, 2000, p.64). Due to the celebrity endorsements, the companies have experienced rapid growth in the sales and services offered to the customers. This has reflected in the growing financial performance of the companies (Dozier, Grunig and Grunig, 1995, p.84). The companies could also attain competitive advantage in the markets that led to the sustainability of the business in the long run. Apart from the various benefits, there are also certain drawbacks in case of celebrity endorsements by the companies. The integrated marketing communication should select the celebrities for endorsement looking at the track record of their public image (Grunig, Grunig and Dozier, 2002, p.93). The selection of the celebrities who are rated highly in terms of their professional performance but have dubious public image in the society may not help the company to attain the desired goals of celebrity endorsement as discussed above. Furthermore, any dip in the performance of the celebrities in future or any record of public defamation may lead to negative impacts on the business in the same proportion (Heath, 2001, p.37). Taking all these into consideration, the celebrity endorsement is a crucial decision as it influences the marketing communication to the customers. Conclusion The celebrities have been followed by the people of the societies in various parts of the world and with the passage of time the fan clubs have developed in the support of these celebrity figures. The celebrity had meaningful impact on the decisions taken by the people of the society in choosing ways of life and making decisions that were in some ways influenced by the activities of the celebrities. In order to draw the attention of the customers and communicate the reliability and excellence in the performance of the products, the celebrities have been appointed as brand ambassadors by the companies to endorse their products and services in the market. The celebrity endorsements have played an effective role in integrated marketing communication and have been able to achieve the underlying objectives of the companies in boosting the growth of sales revenues, profitability, productivity and competitive advantage in the market. The expenditures incurred by the business houses for marketing and promoting the products and services through celebrity endorsements have helped the companies to improve the efficiency of marketing their products. The goodwill and the brand equity are important measures of judging the performance of the companies in competitive industry. The marketing communication plan has been a strategic approach to create and retain loyal customers in the industry in order to meet the challenges of competition. References Aaker, D. A. and Keller, K. L. 1990. Consumer evaluations of brand extensions. Journal of Marketing. 54(1), pp.27-41. Abrams, R. and Abrams, R. M. 2003. The Successful Business Plan: Secrets & Strategies. 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