Celebrity Endorsement - Literature review Example

 Celebrity Endorsement Exploring the contribution of celebrity endorsement to achieving marketing communications objectives in the retail clothing industry: a case study on Topshop Chapter 2: Literature Review 2.1 Introduction The purpose of my study being to answer the question whether celebrity endorsements act as an antecedent of brand-brand building and accept impact over the purchasing behaviour of customer in case of fashion apparel, it becomes necessary that the literature review aims at developing a broad understanding of the theoretical basis of integrated marketing communications be built up first; the reason being celebrity endorsement is a constituent of the marketing mix. Moreover, this would facilitate developing better understanding of the concepts of marketing mx and its two broad elements such as the mass communication and personal communication elements. While, the mass communication elements include advertising, sales promotions, events and experiences, and public relations; the elements of personal communications include direct and interactive marketing, word of mouth, and personal selling. Further, as in reality, both the mass communication and the personal communication elements are incorporated in a cohesive manner; it would be worthwhile to study how marketing mix is integrated to achieve marketing objectives. Subsequently, to cater to the objective of the study viz. (1) to identify the influence of celebrity endorsement on consumer buying behaviour; (2) to find out if celebrity endorsement is a source of brand-building; (3) to find out which kind of celebrity persona is most effectual; (4) to find out if a positive approach towards the celebrity would lead to product trial, I felt learning about the underlying theories for the participation of celebrity and its consequent effect in the retail industry is essential. Besides, there would also be a requirement to understand how celebrity endorsement, which is the key word for this study, fits in the entire gamut of marketing communication and how the various elements interact with celebrity endorsement. 2.2.1 Objective of Literature Review Therefore, to enable an effective and critical review of the literatures existing on the subject I figured out my tasks would be in three areas. These are (1) developing the theoretical basis of marketing communication and its elements; (2) developing theoretical understanding on celebrity endorsement works; and (3) finding out what researchers say about the true nature of celebrity endorsement. Accordingly, I prepared a plan for the review of literatures, which I have placed at Figure 1 in the next page. 2.2.2 Plan for Literature Review To enable me to achieve my objectives of the literature review, first I started with a key-word search in our library. The key words included terms such as advertising, marketing communication, celebrity endorsement and branding. Based on these four words, I made a list of titles that matched these four key words. I found a great deal of books, journals, academic publications, research papers, and dissertations matching these words. Besides, a search on internet also provided innumerable information on the subject. However, to avoid getting bogged down by over information, and also due to my own limitations, I decided to concentrate on a limited number of books and authentic articles from academic and research journals, so that I get what I wanted to achieve. Figure 1: Plan for literature review 2.2 Marketing Functions 2.2.1 Marketing and the merchandise Kotler et al., (2009) argue that “good marketing is no accident, but a result of careful planning and execution’[Phi091]. Organisations have long understood that a large part of their financial success rests with their marketing ability and consequently dependent on successful implementation of marketing activities. While, “marketing is about identifying and meeting identifying and meeting human and social needs”[Phi091], but the best possible meaning, as Kotler et al, suggest would be “meeting needs profitably”. Marketing professionals can market anything; from goods to services, and from events to experiences. Even people, places and properties are known commodities that are marketed. The latest to join in the list of marketable commodities are organisations, information and ideas[Phi091]. 2.2.2 The Marketing Mix In this band of items, almost everything conceivable on earth has been covered to be marketed. To market these items the marketer formulates marketing activities and crafts an integrated marketing programme that would “create, communicate, and deliver value to the consumers” [Phi091]. Kiely (2008), cites McCarthy, who classified the marketing activities into four broad activities as the marketing –mix tools, which he called as the 4P’s of marketing (Kiely, 2008; cited by Kotler et al. (2009). McCarthy four P’s comprised (1) product, (2) price, (3) place, and (4) promotion. Kotler et al., (2009) provided a list of activities that are included under the four P’s (placed at figure below) and state that “marketers make marketing-mix decisions for influencing their trade channels as well as their final consumer”[Phi091]. Figure 2: The Four P components of marketing mix Source: Kotler, P., Lane, K., Koshy, A. & Jha, M., 2009. Marketing Management. Pearson Prentice Hall, p.24. To overcome the bias of McCarthy’s four P’s towards, product marketing in earlier days, and to include a whole range of merchandising items, later the marketing mix was extended to seven P’s. The seven P’s include the four P’s of McCarthy; in addition it includes people, process and physical evidence. Marketing communications forms a subset of one of the P’s – ‘promotion’. Regardless of the number of P’s a firm should purse, both practitioners and researchers have long understood that to successfully market a product, promotion is an essential requirement. And to promote about the item of merchandise, they need to communicate to the prospective buyer; hence the importance of marketing communications. 2.3 Marketing Communications 2.3.1 Definition Kotler et al. (2009), define marketing communications as the “means by which firms attempt to inform, persuade, and remind consumers – directly or indirectly – about the products and brands they sell”. Kotler et al. (2009) argues that marketing communications represent the “voice” of the company and its brands and are a means by which it can establish a dialogue and build relationships with consumers” [Phi091]. 2.3.2 Functions and objectives of marketing communication Luo and Donthu (2006) in their paper on “Marketing's Credibility: A Longitudinal Investigation of Marketing Communication Productivity and Shareholder Value” published in the Journal of Marketing Communication (October 2006) highlighted the importance of marketing communications. Kotler et al., (2009) argued that marketing communication can perform many functions for consumers. These can be divided into broadly four areas such as tools to communicate: (1) information on the users; (2) information on the manufacturers or service providers; (3) information on incentives or rewards on trial or usage of the products and services; and (4) as links to the brands of the manufacturer or service provider. User information Information on users is a crucial function of marketing communication Marketing information, whereby it can tell or demonstrate (1) how a product is used; (2) why a product is used; (3) who can use these products; (4) where the products can be used and (5) when they can be used.[Phi091] Information on Manufacturers or Service Providers Marketing communications can also be sources of information for consumers to learn about the manufacturer of the product of service provider, and other details about what the company and its brands stand for[Phi091]. Information on incentives or rewards for trial or use A third function of the marketing communications is that can serve as a source of information for the incentives on rewards for trial or use promulgated for promotion of the products and services of the company[Phi091]. Link to the Brands However, by far the most important function perhaps from the company’s point of view is that it provides a “link to their brands to other people, places, events, brands, experiences, feelings and things” [Phi091]. Luo and Donthu (2006) argue that by establishing the brand in the memory and creating an image of the brand, marketing communications can even contribute to brand equity of a company (Luo and Donthu, 2006; cited by Kotler et al., (2009). The authors used secondary longitudinal data to demonstrate that the impact of marketing communication productivity on shareholder value is positive and non-linear [Xue06]. 2.3.3 Marketing communication models As early as Strong (1925) to recent times, researchers have tried to understand the role of marketing communication and have developed various models explaining the communication process. The two popular models are macromodel and the micromode. (E.M. Strong. “The Psychology of Selling” (New Yourk; McGraw-Hill, 1925, p.9; cited by Kotler et al., 2009, p.462). The communication macromodel The communications macromodel has nine elements of which two elements represent the two major parties involves in any marketing communication, namely the sender and the receiver. Another two elements of the model represent the two important communication tools i.e. the message and the media through which the message needs to be propagated. Another four elements represent the four crucial communications functions such as encoding, decoding, response and feedback. Finally, the last element represents the noise prevailing in the system under “random and competing messages that may interfere with the intended communication” [Phi091]. Figure 3: Elements in the communications macromodel Source: Kotler, P., Lane, K., Koshy, A. & Jha, M., 2009. Marketing Management. Pearson Prentice Hall, p.24. How does the macromodel work? As evident in the figure above, a sender need to know who are the audience it wants to reach and what response it would like to get. Accordingly, in order to get the desired response, it must encode the message for the target audience, in such a way so that they can decode the message and interpret it correctly. To enable the message reach the target audience, the sender after decoding need to transmit the message through a suitable media. The sender also needs to have a media to receive the feedback. Finally, the sender needs to note that there may be ample noise be available in the system in form of random and competing messages. Kotler et al., state that “the more the sender’s field of experience overlaps that of the receiver, the more effective the message is likely to be” [Phi091]. The communications micromodel In this model, the sender focuses on specific responses of the consumer to its communications. Various researchers have developed models in line with the communications micromodel from time to time. Of which four models are particulars are popular. These are (1) the AIDA model developed by Strong (1925); (2) the Hierarchy-of-Effects model developed by Lavidge and Steiner (1961); (3) Innovation-Adoption model developed by Rogers (1961); and (4) the communications model developed by various authors. The common strand that runs through all the models is that all these models assume that the buyer passes through three stages. First, the buyer goes through the cognitive stage, where he/she learns about the product or services, or about the buyer and other things related to the merchandise. In the second stage, the buyer moves through affective stage, where he/she feels like buying the product or service. Finally, the third stage, behaviour stage, here the buyer actually does the purchasing [Phi091]. 2.3.4 Elements of marketing communications Ever since the days of Strong (1925), marketing environments have gone through radical changes. Recent trends in marketing communications, armed with digital technology with ammos such as computing, telecommunications, and television is invading in to the monopoly of advertising space. Bennet (1995) and others have identified that marketing communications mix comprises of eight major modes of communication. Called as the marketing communication elements, when utilised well, can provide huge potential payoff. These are (1) advertisement, (2) sales promotion, (3) events and experiences, (4) public relations and productivity, (5) direct marketing, (6) interactive marketing, (7) word-of-mouth marketing, (8) personal selling. I have compiled some definitions, traits and characteristics about these elements and placed them in the succeeding paragraphs. Advertisement Any paid form of nonpersonal presentation and promotion of ideas, goods, or services by an identified sponsor [Phi091]. Bharadwaj’s (2006) definition of PR is consistent with that of Kotler et al. (2009) as “ it is any paid form of non-personal communication link, initiated by an identified marketer, to establish or continue exchange relationships with customers and at times, with other stakeholders [SBh06]”. Bharadwaj (2006) states that the primary purpose of Advertising is to position a product or brand; as a result of advertising differentiation is achieved. Kotler et al., (200) have listed three important characteristics of advertising, which include: 1. “Pervasiveness – Advertising permits the seller to repeat a message many times. It also allows the buyer to receive and compare the messages of various competitors. Large scale advertising says something positive about the seller’s size, power and success. 2. Amplified expressiveness – Advertising provides opportunities for dramatizing the company and its products through the artful use of print, sound, and colour. 3. Impersonality – The audience does not feel obliged to pay attention or respond to advertising” [Phi091]. Sales promotion A variety of short-term incentives to encourage trial or purchase of a product or service. Bhardwaj (2006) defines sales promotion as “a direct inducement that offers an extra value or incentive for a product, to the trade or consumer, with the objective of creating an immediate sale” [SBh06]. Kotler et al., (2009) have listed three important characteristics of sales promotion; these are: 1. Communication – They gain attention and may lead the consumer to the product. 2. Incentive – They incorporate some concession, inducement, or contribution that gives value to the consumer. 3. Invitation – They include a distinct invitation to engage in the transaction now” [Phi091]. Bharadwaj (2006) pointed out some fundamental differences between advertisement and sales promotion, which are as follows: 1. Advertising is long-term focused while SP is short-term 2. Advertising is difficult to measure, while SP is easy to measure 3. Advertising gives a reason to buy, while SP gives you an incentive to buy 4. In the seventies, the ratio of advertisement to sales promotion used to be 75:25; now it is 25:75 in the west. Researchers are debating over the issue of effects of sales promotion as “too much sales promotion can damage brand equity”[SBh06]. Events and experiences Events and experiences include company-sponsored activities and programs designed to create daily or special brand-related interactions[Phi091]. The characteristics of events and experiences managed by firm-sponsored activities and programmes can be relevant, involving and implicit [Phi091]. Public relations Public relations include a variety of programs designed to promote or protect a company’s image or its individual products. Bharadwaj (2006) states that public relations (PR) “fosters goodwill between an organization and its publics, or stakeholders” [SBh06]. Bharadwaj elucidates several key characteristics of PR as follows: 1. PR is a double edged sword; when managed effectively can be useful but can be devastating if mismanaged. More than any other marketing tool it can rebound on the firm. 2. PR is usually considered as more credible than advertising. 3. PR can effectively make a frim to transit from a consumer-centric organisation to stake-holder centric organisation. 4. However, when PR becomes especially publicity oriented, it can generate bad reputation. Additionally, Kotler et al., (2009) suggest that public relation can reach prospects that prefer to avoid salespeople and advertisements. Besides, it can also dramatize a firm’s products and services. Direct marketing Direct marketing employs use of mail, telephone, Fax, e-mail, or Internet to communicate directly with or solicit response or dialogue from specific customers and prospects[Phi091]. Interactive marketing Interactive marketing include online activities and programs designed to encourage customers or prospects and directly or indirectly raise awareness, improve image, or elicit sales of products and services[Phi091]. The characteristics of both direct and interactive marketing are (1) they are customised, (2) up—to-date and (3) interactive [Phi091]. Word-of-mouth marketing This marketing communications element includes people-to-people oral, written, or electronic communications that relate to the merits or experiences of purchasing or using products or services[Phi091]. The important characteristics of word-of-mouth are that they are highly credible. In addition they are highly personalised and are immaculately timely[Phi091]. Personal selling In personal selling the seller does “face-to-face interaction with one or more prospective purchasers for the purpose of making presentations, answering questions, and procuring orders”[Phi091]. The important characteristics of personal selling are (1) personal interaction, since it caters to an immediate and interactive session involving two or a few people; (2) cultivation – it permits cultivation of matter-of-fact selling to even deep personal friendship; and (3) response – the buyer may be obliged to respond [Phi091]. In reality, marketers have been ingeniously developing numerous platforms to disseminate company communications to the consumers. Various researchers such as Doncan and Moriarty in their paper “How Integrated Marketing Communication's 'Touch Points' Can Operationalize the Service-Dominant Logic” and Lusch and Vargo (2006) in their work “The Service-Dominant Logic of Marketing: Dialog, Debate, and Directions, (ed.) have emphasised that “product’s styling and price, the shape and colour of the package , the sales person’s manner and dress, the store décor, the company’s stationery – all communicate something to buyers. Every brand contact delivers an impression that can strengthen or weaken a customer’s view of a company” [Phi091]. I have reproduced some of the communication platforms and placed in Table 1 below. Table 1 : Common marketing communication platforms Advertising Sales Promotion Events & Experiences Public Relations & Publicity Direct & Interactive Marketing Word-of-Mouth Marketing Personal Selling Print and broadcast ads Packaging outer Packaging inserts Motion pictures Brochures and booklets Posters and leaflets Directories Reprints of ads Billboards Display signs Audio-visual material Symbols and logos Videotapes Contests, games, sweepstakes, lotteries Premiums and gifts Sampling Fairs and trade shows Exhibits Demonstrations Coupons Rebates Low-interest financing Trade-in allowances Continuity programs Tie-ins Sports Entertainment Festivals Arts Causes Factory tours Company museums Street activities Press kits Speeches Seminars Annual reports Charitable donations Publications Community relations Lobbying Identity media Company magazine Catalogues Mailings Telemarketing Electronic shopping TV shopping Fax mail E-mail Voice mail Blogs Websites Person-to-person Chat rooms Blogs Sales presentations Sales meetings Incentive programs Samples Fairs and trade shows Source: Kotler, P., Lane, K., Koshy, A. & Jha, M., 2009. Marketing Management. Pearson Prentice Hall, p.460 2.3.5 Integration of marketing communication elements Kotler et al. (2009) argue that “although personal communication is often more effective than mass communication, mass media might be the major means of stimulating personal communication. Researchers are, however, unanimous in their argument that irrespective of the manner in which a firm associates its brands with the consumers, all the marketing communication activities of the firm must be integrated so that it delivers a consistent message and thereby achieve positioning of its brand on a long term basis [Phi091]. Researchers are of the opinion that different messages confuse the customer and damage brands. Figure 4: Integrating marketing communication to brand equity Source: Kotler, P., Lane, K., Koshy, A. & Jha, M., 2009. Marketing Management. Pearson Prentice Hall, p.460 2.3.6 Advantages of effective marketing communication The figure above depicts how the various elements of marketing communication when integrated can bring in advantage to a firm by building up brand awareness, brand image, positive brand responses and ultimately developing a congenial brand relationship. For instance, effective marketing communications can substantially help building brand equity and increase sales, since it contributes substantially towards creating brand awareness of the firm. Similarly, marketing communication can create the desired associations with the brand image in the memory of consumers. Another advantage of effective marketing communications is that it can stimulate positive feelings about a brand. In other words, marketing communication can prompt benign brand judgements. Finally, marketing communication provides a stronger brand connection with the consumer than in the absence of it [Phi091]. 2.4 Celebrity Endorsement 2.4.1 Definition and concept Oxford Dictionaries explain, “to endorse as to declare one’s public approval or support” (www.oxforddictionaries.com, 2011). On the other hand, a celebrity endorser, as defined by McCracken (1989) as “any individual who enjoys public recognition and who uses this recognition on behalf of a consumer good by appearing with it in an advertisement” (McCraken, 1989; cited by Zahaf & Anderson, 2008, p.57). Researchers have argued that celebrities are more effective than any other form of endorsements (Freidman and Freidman, 1979; cited by [Lau10]) Stewart (2010) explains that those in the public eye such as movie stars, musicians, wealthy entrepreneurs, and political figures are generally held in popular culture as ‘inspiration for fashion and consumption’. Firms try to en cash this influence of the celebrities, which they exert on the public. 2.4.2 Theories of celebrity endorsement Various researchers have tried to theorise this phenomenon. Some of the few important theories are (1) the Source Credibility Theory suggested by Hovland, Uanis and Kelly (1953) and (2) the Fashion Diffusion Theory developed by Rogers (2003). While the Source Credibility Theory emphasises on the three constructs (1) expertise, (2) trustworthiness and (3) attractiveness, which influence consumers’ opinion of the source; the Fashion Diffusion Theory suggests that innovations are communicated to the consumers over time in six steps such as: (1) invention and introduction, (2) fashion leadership, (3) increasing social visibility, (4) social conformity, (5) social saturation, and (6) decline (Weimnann, 1994; cited by Stewart, 2010, p.2.). As early as Joseph (1982) have found that “physically attractive communicators are often liked more and have positive impact on opnion change and product evaluations” (Goldsmith et al., 2000; cited by Stewart, 2010, p. 2). Earlier, Tellis (1998) observed that attractiveness of an endorser comprises similarity, familiarity and liking, of which familiarity is an important aspect. Similarly “credibility is crucial as it strengthens the credibility of her/his claims. Further, similarity with the endorser is defined as the target market awareness of the celebrity, her/his friendliness, likeability and trustworthiness”.[Zah08]. Zahaf & Anderson (2008) state that even though researchers are divided over the nature of relationship between celebrity endorsement and buyer behaviour, yet there is by and large consistency about two sets of factors that characterise celebrity product endorsement. These are: 1. “source based factors such as celebrity credibility, attractiveness, expertise, and trustworthiness (related solely to the celebrity and controlled by the celebrity); and, 2. management based factors such as celebrity product congruence, social desirability of the celebrity, and reverse effect of brand image (related to marketing the celebrity and are controlled by management)”. (Seno & Lukas, 2007; cited by Zahaf & Anderson 2008, p.58) 2.4.3 Celebrity endorsement as a strategy Kathyal (2011) in his web article “Impact of Celebrity Endorsements on a Brand” lists five motives, which prompts companies to hire celebrities for endorsement of their products. These are (1) instant brand awareness and recall; (2) celebrity values define, and refresh the brand image; (3) celebrities add new dimensions to the brand image; (4) instant credibility or aspirations to the brand image; (5) convincing clients” [Kat11]. Kotler et al., (2009) state that “a well-chosen celebrity can draw attention to a product or brand” [Phi091] and therefore, companies can weave a strategy taking celebrity endorsement as an effective tool for translating their marketing communications objectives. Nevertheless the strategy needs to be weaved with care to ensure that there is appropriate compatibility with the celebrity endorser and the brand. This would also require a consideration of the relationship between celebrity endorsement and buyer behaviour. Kathyal (2011) supports views of Kotler et al., and state that celebrity endorsements may not work unless the celebrity endorser is compatible with the requirement and listed 13 compatibility factors between celebrity persona and the overall brand image, which needs to be considered while hiring a celebrity. These are: 1. Celebrity’s fit with the brand image 2. Celebrity – target audience match 3. Celebrity associated values 4. Cost of acquiring the celebrity 5. Celebrity – product match 6. Celebrity controversy risk 7. Celebrity popularity 8. Celebrity availability 9. Celebrity physical attractiveness 10. Celebrity credibility 11. Celebrity prior endorsements 12. Whether celebrity is a brand user 13. Celebrity profession [Kat11] Kotler et al., (2009) opine that “celebrities can play a more strategic role for their brands, not only endorsing a product but also helping to design, position, and sell merchandise and services” [Phi091]. However, in formulating a strategy for celebrity endorsement, “the choice of the celebrity is crucial. The celebrity should have high recognition, high positive effect, and high appropriateness to the product. 2.4.4 Does celebrity endorsement work The study of celebrity endorsement (CE) has generated considerable interest in recent years and both academia and industry are curious to know whether celebrity endorsements work. Zahaf and Anderson (2008) stated that a wide range of issues on celebrity endorsement (CE) have been studied in recent years linking CE to (1) effectiveness; (2) matchup between product/brand and the endorser (Seno and Lucas, 2007; Till and Busler, 2000); (3) positive and negative effects (Till and Shimp, 1998); (4) consumer’s association with the endorser (Till and Busler, 2000; (5) Daneshvary and Shwer, 2000); (6) profitability of celebrity endorsement (Agrawal and Kamakura, 1995); (7) CE and purchase intensions (Kamins et al., 1989); (8) celebrity attractiveness; credibility; and (9) trustworthiness (Dean and Biswas, 2001; Seno and Lucas, 2007). However, their results are far from being consistent. While there is no ambiguity about effectiveness of advertisement, success of using celebrity endorsement is doubtful (O’Mahoney and Meenathen 1997; 1998; cited by Zahaf & Anderson, 2008). AccountAbility, a non-profit research institute in their study on how consumers judge products, observed that only 10 percent of the participants chose celebrities’ opinion as important in helping them decide if companies were trustworthy [Bon06]. Alter (2006) argued that consumers rely mostly on information on the package, views of consumer groups, and friends and family members. In addition, people depend upon websites and blogs to judge information[Bon06]. Zahaf and Anderson (2008) in their study on “Causality effects between celebrity endorsement and the intentions to buy” studied the possible relationship between having a celebrity endorser and the attributes that lead to willingness to buy. The authors expected that a celebrity endorser can influence the willingness to buy. To find out the nature of relationship, the researchers had an experimental group which was exposed to a celebrity endorser and the control group, which was not. They found that “the celebrity factor, by itself, did not have a real effect on the intention to buy” [Zah08]. Amos et al., (2008) also studied the subject of celebrity endorsement. The subject of study was “Exploring the relationship between celebrity endorser effects and advertising effectiveness: A quantitative synthesis of effect size”. The authors tried to find the relationship between celebrity endorser source effects and effectiveness in advertising using quantitative methods. The authors observed that “negative celebrity information can be extremely detrimental to an advertising campaign” [Amo08]. The finding of Amos et al., (2008) was consistent with that of a later study undertaken by Knittel and Stango (2010). In their study entitled, “Celebrity Endorsements, Firm Value and Reputation Risk: Evidence from the Tiger Woods Scandal”, Knittel and Stango investigated the effect of stock market following the Tiger Woods scandal, on both the sponsors of the celebrity and the competitor of the sponsors. The researchers found that during the first ten days after beginning of the scandal, stock market value of firms with products endorsed by Woods fell considerably compared to the whole of the stock market and a set of competitors as well. The authors state that “ the top five sponsors (Accenture, Nike, Gillette, Electronic Arts and Gatorade) lost 2-3 percent of their aggregate market value after the accident, and his core three sponsors EA, Nike and PepsiCo (Gatorade) lost over four percent” [Kni10]. The authors found that at least some sponsors’ losses resulted in gain of some of the competitors, which implied that “endorsement deals are partially-business stealing strategy”. The authors concluded that the scandal sent a negative market-wide signal about the reputation risk associated with celebrity endorsements [Kni10]. The findings of all these studies has implication on the present study as the purpose of the present study is to find out the contribution of celebrity endorsement to achieving marketing communication objectives in the retail clothing industry and it would be interesting to see how celebrity endorsement contributes to marketing communications objectives in the retail clothing industry. 2.4.5 Impact of celebrity endorsement on consumers’ apparel purchase decisions Positive impact of celebrity endorsement The impact of celebrity endorsement on apparel industry can be gauged from the news report in nydailynews.com in April 2009 reproduced below: “…as photos of First Lady Michelle Obama surfaced during a trip to London, the cream-colored J. Crew outfit she was wearing sold out online by 10 am that same morning. Soon after selling out, there was a waiting list of over 200 people in line to purchase the outfit seen on the First Lady. In addition, traffic to J. Crew’s company website increased by 3,000%. Due to the First Lady’s endorsement of the J. Crew brand, the company’s stock increased by 64% in a four month period (Carter, 2009). The ensembles that the First Lady has worn have even sparked marketers to purchase the keywords “Michelle Obama” on search engines such as Google and Yahoo (Clifford, 2008; cited by Stewart, 2010, p.1. Stewart (2010) in his study on the “Effect of Consumers’ Perceptions of Political Figures on Source Credibility and Attitude Toward Apparel” tried to explore how do consumers’ political attitudes affect the perceived source credibility of political figures and the consumers’ attitudes toward apparel worn by political figures? The researcher found that (1) “a consumer’s political attitude effects perceived expertise, trustworthiness and attractiveness; (2) consumer’s political attitude has a direct effect on attitude toward apparel worn by a political figure. The author suggested that in view of these findings, retailers need to be aware of the impact of political endorsers on their apparel[Lau10]”. In an earlier study, Khan & Khan (2008) had also studied influence of celebrities on consumers’ apparel buying behaviour. In their study entitled, “Gender Differences In Susceptibility To Normative Social Influence On The Purchase Decisions Of Designer Label Apparel”, the researchers examined susceptibility of male and female consumers to normative social influence (standard setting or celebrity endorsement) on purchase decisions of designer label apparel in Malaysia. In the study, a total of 319 youth participated, where the researchers focused on the youth market giving due consideration for gender differences, influence of family and peers, and celebrity influence. The researchers observed that males and females exhibited susceptibility to these influences differently, with the boys more showing more likelihood. However, they found that “celebrity influence on purchasing decisions of designer label apparel to enhance one’s image or because individuals identify with the celebrities, was found to be weak” [Gha08]. Negative impact of celebrity endorsement Celebrity endorsements do tend to have negative impact too. Researchers have identified many adverse impacts of celebrity endorsements as it happened in the case of Tiger Woods, studied by Knittel and Stango (2010); but these could occur due to a deliberate or sudden misfit of the celebrity vis-à-vis the product as suggested by Kotler et al. (2009). 2.5 Celebrity endorsement at Topsohop 2.5.1 Group company description1 Topshop a favourite destination of youth for apparel and associated fashion accessories in over 20 countries across the world. The company belong to the Arcadia Group, the largest privately owned clothing retailer with more than 2,500 outlets. The group owns seven of the high street’s best known fashion brands and shopping concept outfit, each one of them having their own identity and market segment. The brands include (1) Burton, (2) Dorothy Perkins, (3) Evans, (4) Miss Selfridge, (5) Topman, (6) Topshop and (7) Wallis [Top11]. Apart from having the group’s brands sold in shopping centres in 30 countries across Europe, the Far East and Middle East through 420 international franchise stores, the group also runs an online shopping facility. The E-commerce operation of the group is rapidly expanding and is considerable compared to the retail operations. The group also owns Outfit, offering a mixture of its brands in out-of-town locations. The group is privately owned by Taveta Investments Ltd. owned by Philip Green and his family[Top11]. 2.5.2 Brand history and development2 Now a super-brand, Topshop was born over five decade ago in 1964 as a small department in Peter Robinson, Sheffield. A year later, in 1965, the department was given 2,000 sq. ft in the Oxford Circus basement of Peter Robinson. Nine years later, in 1974, TOPSHOP was taken out of Peter Robinson and set up as a separate business aimed at 13-25 year olds. Four years later, in 1978, Topman, a boy’s and young men’s version was introduced in the high streets; and in 1983 Top Girl for 9-14 year-olds was introduced “so that younger sisters could dress as fashionably as their older sisters” [Top11]. In 1989 the company explored more fashion conscious markets with new shopfits, which were designed keeping the more affluent customer in mind. Three years later, Topshop and Topman join and became the largest fashion store in the world at 214, Oxford Circus, London [Top11]. Until now, the Topshop’ brand image was ‘cheap and cheerful’ for teenagers [sup11]. and was trying to gradually evolve. However, the real transformation of Topshop took place from the mid 1990’s and evolved to the seriously cool, trendsetting brand. The super-brand Topshop has now become “a high street retail phenomenon, enjoying a huge growth in sales and creating a distinctive personality with an individual brand mix. It continues to headline in nearly every fashion title and broadsheet, establishing a reputation for bringing innovation and style to the high street” [sup11]. 2.5.3 Approach to Marketing “Topshop sells 30 pairs of knickers every minute and more than 33,000 pairs of jeans every week. Topshop’s celebrity customers include Gwyneth Paltrow, Kate Moss, Liv Tyler and Lizzie Jagger”[sup11]. Topsohop uses various promotions to attract/maintain customers, such as student discounts all year round (including sales), style advisors, videos and podcasts on their websites and also send out style notes to subscribed customers. One of the key marketing communications strategy of Topshop is to make marketing information through its website. From the backroom of Topshop’s store at Oxford Circus, London with just one person to pick up and dispatch orders, it has turned out to be an enormous sales engine. For instance, on an average 300,000 people now browse www.Topshop.com during peak trading times. 100’s of new products are added every week on its website, www.Topshop.com, with most-wanted items updated daily and placing limited edition pieces in flagship stores[sup11]. To keep its website popular, Topshop communicates every week with almost 150,000 loyal customers through Style Notes newsletter informing them of everything new on the website. From the response rates (a whopping 25 percent), it can be easily adjudged that the Style Notes are an eagerly awaited weekly event for online shoppers” [sup11]. 2.5.4 Celebrity Endorsements at Topshop Topshop’s tryst with celebrity endorsements has been a recent phenomenon compared to its more than five decades of existence. In 2001, Topshop, launched its Style Advisor initiative at selected stores, offering free personal fashion advice to customers. Soon, in 2002, Topshop sponsored the New Generation at London Fashion Week to provide young designers with financial support and a promotional platform to produce their collections. Subsequently, in 2005 Topshop’s Unique collection become the first high street range to be shown on the catwalk as part of the official schedule of London Fashion Week. The range was later picked up and stocked by New Yourk boutique Opening Ceremony. However, it was until 2007, when Topshop launched the hugely-popular British supermodel Kate Moss for Topshop range apparels. In May the same year, she designed her first collection for Topshop, “resulting in unprecedented scenes of fashion fans queuing round the block to get their hands on a slice of the supermodel’s style”[Nam07]. Later that year in the month of July, Topshop roped in British artist Stella Vine to design a limited edition fashion range exclusively for it. Figure 5: Kate Moss designing her ranges of apparel for Topshop Picture source URL: http://estb.msn.com/i/67/A8C1EE3E3056F9A4226BFD71E1348.jpg 2.5.6 Evaluation of celebrity endorsement at Topshop Holly Seddon, a contributor for MSN Money reported “How fickle the world of fashion is. In 2005, Kate was dropped like a stone after reports of alleged drug taking”[Hol10]. “Fast forward just two years and Phillip Green was snapping her up to design a line for Topshop. The UK deal was said to net Kate somewhere in the region of £3 million, but sales abroad could bump this figure up considerably. But, with thousands of women queuing outside Topshop's Oxford Street flagship store at the launch of her first collection, the gamble paid off [Hol10]. In the wake of their huge success of the Kate Moss clothing range, Topshop introduced the range to the United States market through U.S. department store Barneys, New York to sell through its 19 stores[Nam07]. The multiplier effect of celebrity endorsement can be easily gauged from the 2007 web-page by BrandName, a branding agency reproduced below. Source: NameWire, 2007. Kate Moss, the Brand Name. [Online] Available at: http://www.namedevelopment.com/blog/archives/2007/05/kate_moss_the_b.html [Accessed 22 January 2011]. Apart from the media hype, Thomson et al., (2010) tried to explore the deep emotional association called the Lovemark concept in the context of celebrity endorsement by examining the agreement between a celebrity and the brand. In their study on “Kate Loves Topshop: Celebrity Endorsements and the Lovemarks Concept in a Fashion Retail Context”, the authors “examined the congruency between emotions felt for UK fashion retailer Topshop, and its associated celebrity Kate Moss”[Tho101]. Explaining the Lovemarks concept, Robert (2005) state that “a Lovemark is distinguished from conventional brands by inspiring deep, long-lasting relationships based on emotional responses invoked by the characteristics and personality it represents” (Robet, 2005; cited by Thompson et al., 2010). The researchers’ findings suggest that “emotional responses to a celebrity have resonance on attitudes toward a brand” (Thomson et al., 2010). 2.6 Chapter summary The role of marketing communications in the diaspora of marketing functions can never be overestimated. Marketing communications promote a company’s brand image increase brand salience. Among the many facets of marketing communications, marketers give advertising, public relations & publicity special relevance. For the purpose of gaining immediate publicity, firms use celebrities to endorse their products; partly because of the celebrity endorsers’ power to influence buyers’ attitude. In the apparel industry too fashion designers and retailers have been employing celebrity endorsers. Though, in the apparel industry, as in some other industry segments too, celebrity endorsement have been regarded as a subtle strategy in contemporary brand management but researchers have divided opinion about their success. 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