Why Celebrity Endorsements Are Effective as Marketing Strategy Tools - Assignment Example

Chapter 4: Discussion Various studies have shown that celebrity endorsements are effective as marketing strategy tools because of their ability to appeal to a wider category of people through association of products with known personalities. Celebrity in this case is described as a person who is popularly known because of their excellence in a particular field, extraordinary skills or talents (Ohanian, 1991). The following section discusses findings from a survey study that evaluated 52 respondents, 34 of whom were males while 18 were females. Q 12. Have you ever purchased a product that is advertised by celebrities? In this study, 45 respondents, comprising 83%, conceded to have bought an item or items endorsed by a celebrity. On the other hand, only 7 respondents, representing 13%, said they have never bought an item that has been endorsed by a celebrity. These statistics allude to the effectiveness of celebrity endorsement as a tool to influence consumer choice. While a myriad of factors undoubtedly comes into play in influencing a consumer’s final purchasing decision, Hamish and Pringle, 2005 posit that celebrity endorsement can indeed convert positive purchase intentions into actual purchases in Generation Y teenagers. Indeed, a research done by [Mar04] found out that product endorsement by celebrity athletes led to measurable behavioural outcomes such as switching to new products, positive verbal commentary or complaints about a product. Conversely, negatively perceived endorsers can lead consumers to view the endorsed brand negatively. These results are consistent with the view that in spite of the cost and the attendant risks, celebrity endorsement is indeed an effective marketing tool. Consequently, there should be concerted effort in celebrity choice in order for their endorsement to result in brand promotion. Q 10. What attracts you more: Celebrity endorsed products or non-celebrity products? This study found out that 33 % of respondents indicated that they are attracted to celebrity-endorsed products, 8 % said they were attracted to non-celebrity endorsed products while 60 % of interviewed respondents said it depended on the product. These findings reveal the effectiveness of celebrate endorsement in marketing differs according to product. The underlying assumption behind celebrity endorsement as a marketing tool is that an endorsement effectively suspends the consumer’s judgement of the product itself. Consequently, consumer choice is expected to rely upon the perceived positive attributes of the endorser. These findings however point to the obvious need to focus on not only the perception of the product by the consumer but also on the substance of the product itself. It could also mean that the attractiveness of a celebrity-endorsed product also depends on the product type. This in turn raises the obvious need to establish product types whose attractiveness is most reliant on celebrity endorsement. Indeed, it also means that there ought to be a match between an endorser and the endorsed product in order for the endorsement to make financial sense for the marketer. Q 9. Does the presence of celebrities help you recognize the brand? According to Erdogan et al, 2001, celebrity endorsement attracts a consumer’s attention in media spaces that are cluttered with advertisements. This attention in turn enhances brand recognition in the market. The findings of this study are consistent with this view since 52% of respondents said that the presence of a celebrity helped them recognize a brand. On the other hand, 40% of respondents were unsure whether celebrity endorsement helped them to recognize brands while only 8% believed that the presence of a celebrity did not help them in brand recognition. As far as brand recognition goes therefore, this study found out that celebrity endorsement is indeed and effective tool in enhancing brand recognition. Q8. How frequently do you come across advertisements that feature celebrities? Due to the multiplicity of products in the market place, marketers are confronted with the difficulty of attracting the attention of potential buyers to their goods and services. In order to make their marketing messages stand out in this media clutter, marketers have turned to celebrity endorsements. Agrawal and Kamakura, (1995) found out that celebrity endorsement has been on the upward trend since its inception. The findings of this study are consistent with this view since 69% of respondents said that they often come across adverts that feature celebrities. Only 27% of respondents said that they come across adverts that feature celebrities sometimes while a paltry 4% said that they never come across adverts that feature celebrities. This points to the principal role that celebrity endorsement has come to play in advertising. Q19. Do you believe that celebrity endorsement creates brand loyalty? According to Kammin and Gupta, (2001), advertising messages that involve celebrities are perceived as more credible than those that do not feature celebrities. Indeed, when there is congruence between the attributes of the product and those of the endorser, the consumer’s affection towards both the brand and the advertising message increases Kammin and Gupta, (1994). Celebrity endorsement is therefore considered as an effective marketing strategy for brand positioning. A study by Roll (2006) indicates that using celebrity endorsement in marketing is effective as a “channels of brand communication in which a celebrity acts as the brand’s ambassador and authenticates the brand’s claim and position by extending his/her personality, popularity, stature in the society or expertise in the field to the brand”. This positive attitude towards both the brand and the advertising message results in consumer loyalty. This study found out that 21% of respondents believed that celebrity endorsement definitely resulted in consumer loyalty. On the other hand, 29% of the respondents believed that whether or not a celebrity endorsement resulted in consumer loyalty depended on the product while 42% believed that celebrity endorsement probably led to consumer loyalty. Therefore, a significant number of respondents 63% believes that products that have celebrity endorsements have higher chance of attracting brand loyalty. Consequently, only 3% of respondents thought that celebrity endorsement probably did not result in consumer loyalty while 1% of the respondent did not respond to the question. These findings demonstrate that celebrity endorsement is largely perceived as effective in creating consumer loyalty. These results are therefore consistent with current evidence that demonstrates the effectiveness of brand endorsement in marketing and consequently in creating brand loyalty. Q7. Do you believe that the quality is at a high standard due to the recognition of the celebrity? According to to Murkerjee (2009), celebrities are individuals who enjoy high visibility in the society due to their attractiveness or special skills. Celebrity endorsement serves to rend credibility to the marketer’s claims regarding the value of the brand that they seek to popularize. Indeed, according to Kammin and Gupta, 2001, celebrity endorsers are perceived being more credible than non-celebrity endorsers. The process of endorsement involves the transference of the endorser’s positive attributes to the endorsed brand. This transference in turn enhances the brand’s perception in the market. This study found out that 13% of the respondents believe that celebrity endorsement definitely led to a brand being viewed as of high quality while 44% felt that celebrity endorsement probably enhanced a brand’s perception. 27% believed that and endorsement might or might not improve a brand’s perception of quality. In addition, 8% felt that celebrity endorsement probably did not lead to perception of quality while an additional 8% were sure that celebrity endorsement did not lead to the brand being perceived as being of high standard. Q6. Does it matter which specific celebrity is associated with the brand? According to the Match-Up Hypothesis, a celebrity endorsement might fail to work if there is no congruence between the endorser and the brand, (Kammin, 1990). Therefore their needs to be a similarity between the attributes of the endorser and the attributes of the endorsed brand in order for desired outcomes to be realized. Additionally, the general perception of the endorser in the eyes of the consumer also matters. Negatively viewed celebrities can end up hurting a brand’s image while positively viewed celebrities transfer their public good will to the brand. The findings of this study indeed reinforce this view since an overwhelming number of respondents, 62%, felt that the specific celebrity associated with the brand mattered. On the other hand, 13% believed that identity of the celebrity did not matter, 23% said that the specific celebrity did not matter while 2% did not respond. Q18. As a customer, do you feel the supply for these products is too low or do you prefer them being very limited? Current literature indicates that a significant number of items that are sold through celebrity endorsements includes designer items that often refer to luxury items that are sold under “prestigious marque” usually named after a persons, name, place or title. One of the marketing strategy of designer products include restricting sales in order to control sales in the market place and create a perception of designer label among the customers. The data analysis from respondents indicates that 50% of the respondents prefer the supply of celebrity endorsed products in the fashion industry to be limited while 48% indicate a preference for more supply. Based on these findings it will appear that the level for celebrity endorsed brands in the fashion industry is neither high nor low. This is a good balance since it creates an impression of shortage of celebrity products in the market while at the same time provides adequate amount of brand presence in the market. If significant number of respondents were to indicate that supply is limited or vice versa it will imply lack of celebrity brand visibility of excess of it which can be a disadvantage to the brand performance. Q17. As a consumer do you feel uneasy with you're unable to purchase these products for the retail price? The results from respondents indicates that as high as 46% of persons surveyed indicated that they felt uneasy by the fact that they were not able to access celebrity branded products at retail price. While another 23% of the respondents indicated that they were definitely unhappy that they could not access products of choice at retail price. Cumulatively this accounts to 69%. This could imply that price of products for shoppers is a significant factor to them that influence their decision to buy a product or not. The other reason could be that the choice of shopping stores that majority of the respondents chose to shop at did not provide retail price for target products. In addition, 17% of the respondents indicated that they “might or might not”, an indication that they are unsure or probably sitting on the fence regarding the issue while only 8% of the respondents indicated that they were not bothered at all whether they were able to purchase celebrity endorsed items in retail price or not. Overall, summary of this analysis imply a significant number (69%) of respondents are concerned about not being able to buy products at retails price which means addressing this concern might help stores to increase their sales since it is perceived as barrier to ease of shopping by the respondents. Q16. Are you willing to pay premium 'resell' for these products due to the high demand Respondents were asked their willingness to pay premium on celebrity endorsed products due to the high demands of the product in the market. A significant number of up to 47% indicated that they were willing to pay premium (this is include respondents replying with definite yes at 10% and probably yes at 37%). This group of respondents could be informed by the current trends in fashion industry that indicates it’s a vibrant industry or their own sales statistics that enable them to determine their ability to pay a premium resell. These results are also consistent with the study objectives that hypothesize “Consumers are willing to pay a premium for products associated with celebrities” Additional respondents that indicated that they were unsure “might or might not” were 23%, a factor that implies there is room for swaying this category of respondents in one or another since they are sitting on the fence. Respondents that provided an emphatic no towards paying a premium resell were at 6% which imply an insignificant number that cannot influence the outcome of this observation. It could be that this small proportion of respondents do not have stores in strategic locations that allows fast moving of products. Finally, respondents indicating “probably not” in regard to paying of premium resell were at 23% which imply that this category of respondents were not definite in their response and might be willing to change their mind. 1 respondent from this survey did not indicate any response. Q11. If you had the choice would you buy a cheaper alternative with a similar design or would you buy the pricier option that is endorsed by a celebrity As high as 50% of the respondents indicated that they would opt for a celebrity endorsed product at a higher margin instead of a cheaper (less priced item) for similar products. This is a significant insight in regard to customer perception of celebrity brand endorsed products, and the major factors that influences customer choice such as price which in this case appears not to be a major or the only determinant. When potential buyers opt for pricier products in lieu of cheaper options because of celebrity endorsements, two factors might be at play; brand loyalty and brand perception. Indeed, both of these factors are positively associated with brand performance. Indeed, use of celebrities in advertisement is well documented in various research studies as an effective strategy of improving the perception of a given brand by a consumer (Kamins and Gupta, 1994). A study by Katyal (2009), indicates that using celebrity endorsements provides numerous advantages such as brand recognition, brand popularity, brand loyalty psychographic and demographic brand association and global appeal. In addition, celebrities also add credibility to the authenticity and quality of the product as depicted by the seller or manufacturer which is known to increase the retention of the advertisement among consumers (Kammin and Gupta, 1994). This findings are consistent with the study objectives of this study that demonstrates a positive association between celebrity endorsement and consumer perception. Consequently, of the respondents surveyed, 48% of the respondents indicated that they will opt for a cheaper option. This implies that there is weak impact of celebrity endorsed products among this category of group. It could also mean that there is no brand loyalty and finally it means that for this category of respondents price is a significant factor that they use to make choice of products at the expense of other quality such as quality or brand loyalty. Q5. Do you believe by associating celebrities with these brands, will make the brand more desirable A significant number of respondents at 84% are aware of the influence of celebrity endorsed products and believe that use of celebrities in endorsing products can significantly improve sales for a product. This implies that respondents know that celebrity endorsement in products has desirable influence in brand positioning perhaps due to the success or positive experience witnessed in this regard. However, only 4% of the respondents believe that celebrity endorsements on products does not have any influence, while another 10% are unsure of the impact that celebrity endorsement have in regard to brand positioning and sales. This could imply ignorance or lack of experience in regard to how celebrity endorsement is used to influence sales. Q15. How influential to a purchase decision do you think celebrity endorsement is? A significant number of respondents at 83% indicated that celebrity endorsement in the fashion industry significantly influences a purchase decision among consumers, compared to 18% of respondents that indicated that there is no impact on consumer decision to purchase. The findings of this study is consistent with the study objectives that shows a positive correlation between celebrity endorsement and consumer perception and brand loyalty. Q4. What is your main reason for purchasing these products? Various reasons were given by respondents as the major reasons for buying celebrity endorsed products. Based on 4 broad categories, 50% of the respondents indicated design as the major reason of making a purchase, 25% indicated the reason as being due to good quality of the product, 21% indicated hypes as the major factor and only 4% indicated for resale purposes. Based on this analysis it would appear that the perception that celebrity endorsed product portray among the consumers is in regard to design or fashion, quality and lastly hype. Q13. What type of product have you purchase? The respondents of the study indicates the preferences of celebrity endorsed items bought to be as follow; shoes (37%), Clothing (29%), Accessories (20%), None (10%). This analysis indicates the popularity of the most bought items for the respondents in age group 18-25 years surveyed. References Mar04: , (Martin, et al., 2004), Read More