PROJECT REPORT ON

IMPACT OF CELEBRITY ENDORSEMENT ON CONSUMER PERCEPTION WITH RESPECT TO LUX & DOVE ; PARLE-G & SUNFEAST BISCUIT ,

SUBMITTED BY:
NIDHI SUYAL ROLL NO: 88 MARKETING-M1
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TO WHOMSOEVER IT MAY CONCEREN

This is to certify that the project report titled IMPACT OF CELEBRATY ENDORSEMENT ON CONSUMER PERCEPTION WITH RESPECT TO LUX & DOVE; PARLE-G & SUNFEAST BISCUIT carried out by Ms.Nidhi Suyal, D/o Sh. G.C.Suyal has been accomplished under my guidance & supervision as a duly registered PGDM student of the NEW DELHI INSTITUTE OF MANAGEMENT, NEW DELHI. This project is being submitted by her in the partial fulfilment of the requirements for the award of the PGDM from NEW DELHI INSTITUTE OF MANAGEMENT. Her dissertation represents her original work and is worthy of consideration for the award of the degree of PGDM.

___________________________________ (Name & Signature of the Faculty Advisor) Title: ______________________________ Date:

DECLARATION

I, NIDHI SUYAL declare that this project report titled IMPACT OF CELEBRATY ENDORSEMENT ON CONSUMER PERCEPTION, WITH RESPECT TO LUX & DOVE; & PARLE-G & SUNFEAST has been carried out by me under the able guidance of Dr. GAJENDRA SHARMA and it is my original work as part of my academic course.

NIDHI SUYAL ROLL NO: 88 SECTION-M1

ACKNOLEDGMENT
The completion of this project would not have been possible without the help of all the faculty members of the NEW DELHI INSTITUTE OF
MANAGEMENT. I take this opportunity to convey my hearty thanks to all of

them. At the onset I would like to thanks Dr.A.T.K.RAMAN (DIRECTOR,NDIM.) and Ms. BHUMIKA BANSAL (DIRECTOR GENERAL,NDIM), for giving me an opportunity to work on this project under the able guidance of
Dr.GAJENDRA SHARMA.

I thank my project guide Dr. GAJENDRA SHARMA, for the level of interest that he took in my project. He was the person who actually has given my project the present shape, his advice, comments, and criticisms on my work has helped me in rectifying many of the flaws and defects in my work. He gave me enough time even in his busy schedule and my discussions with him on several aspects of marketing have helped me in broadening my knowledge. I also thank Ms. MEGHA CHAWLA, Ms. ANITA SAXENA, Ms. VEENA KUMAR and Mr. VINEET VISHNU for their initial direction s. I once again thank all members of NDIM team & students of NDIM for their cooperation.

TABLE OF CONTENT
CONTENT
1. Executive summary 2. CHAPTER 1 y INTRODUCTION y SYNOPSIS y DEFINITION OF CELEBRITY y ATTRIBUTES OF CELEBRITY y NEED FOR CELEBRITY ENDORSEMENT y CELEBRITY EDGE y SCOPE OF CELEBRITY ENDORSEMENT y CELEBRITY ENDORSEMENT IN INDIA 3. CHAPTER 2 y LITERATURE REVIEW 4. CHAPTER 3 y OBLECTIVE OF THE STUDY y RESEARCH METHODOLOGY 5. CHPTER 4 y TIOLET SOAP INDUSTRY y LUX TOILET SOAP y DOVE TOILET SOAP y BISCUIT INDUSTRY y PARLE-G BISCUIT y SUNFEAST BISCUIT 6. CHAPTER 5 y FINDING AND ANALYSIS y TOILET SOAP ANALYSIS y BISCUIT ANALYSIS
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06 09 10 13 14 16 18 19 20 23 25 26 33 34 34 38 39 41 43 46 47 49 52 53 53 59

7. CHAPTER 6 y SUMMARY y CONCLUSION y LIMITATION y RECOMMENDATION 8. CHAPTER 7 y ANNEXURE y BIBLIOGRAPHY y QUESTIONNAIRE

66 67 68 70 71 72 73 73 74

EXECUTIVE SUMMARY
India is a country where people love to live in dreams. They worship celebrities. Celebrities may be Cricket stars like Sachin Tendulkar, Mahinder Singh Dhoni or Film Stars like Salman Khan, John Ebrahim. They treat them as God. Marketers use this very preposition so as to influence their target customers, may be existing or potential ones. For this they rope in these celebrities and give them whopping amount of money. They believe that by doing this they can associate their products with their target customers. This is called celebrity endorsement. But does this celebrity endorsement acts as a source of brand-building and have impact over the purchasing behaviour of customers in case of FMCG? For this I decided to conduct these vary research and objectives of my research are: To identify the influence of celebrity endorsement on consumer perception. To study celebrity endorsement as a source of brand -building. To find which type of celebrity persona is more effective. Lot of researchers has done extensive research work regarding celebrity endorsement, its influence over customers purchasing decisions. After studying the whole literature related to celebrity endorsement I found a gap in the study. This gap was whether celebrity endorsement acts as a source of brand-building. So I decided to undertake research on this particular aspect. This research is limited to Delhi Region only due to various constraints like time available, scarcity of resources etc. From this we can make an attempt to generalize the result to the whole universe. After conducting research it was found that brand name and celebrity endorser are the two key factors that play an important role in affecting purchase intention. Majority of the
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people want to see their favourite celebrity endorsing their brands but they also tend to buy intelligently considering the brand and its quality . To carry out my research I used Chi square test and came to a conclusion that though celebrity endorsement plays an important role but yet brand name and some other factors are also equally important . People love to see bollywood and TV stars endorsing FMCG than that of sports stars. This particular aspect is mainly supported by the fact that in India where bollywood stars is the ideal of so many Indian consumers, and also TV stars are becoming equally popular amongst Indian consumer after popular shows like kyuki saas bhi kabhi bahu thi. Another important fact which came into existence was majority of people follow their favourite celebrity while making a new purchase every time. Beside this, one major factor come into existence that mostly respondents were able to recognize the celebrity used in various advertisement. So in this brand recall test, mostly positive results were found. One open -ended question was also included about suggestion. Instead of wasting a huge amount of money on celebrity endorsement, Companies should come out with some schemes so as to lure their customers. So it can be concluded that
for a small extent Celebrity endorsement acts as a source of brand building but company should follow integrative approach so as to build strong brands. Beside celebrity endorsement they should run certain

schemes so as to provide value to the customer and to build strong brand.

Chapter-1

1.1 INTRODUCTION
The modern world of marketing communication has become colorful and inundated with advertisements, and it is hard to get noticed. It is an uphill task for the designer of an advertising campaign to differentiate itself from others and attract viewers attention.

Everyday consumers are exposed to thousands of voices and images in magazines, newspapers, and on billboards, websites, radio and television. Every brand attempts to steal at least a fraction of an unsuspecting persons time to inform him or her of the amazing and different attributes of the product at hand. The challenge of the marketer is to find a hook that will hold the subjects attention.

In this jet age, people tend to ignore all commercials and advertisements while flipping through the magazines and newspapers or viewing TV. But even then, the glamour of a celebrity seldom goes unnoticed. Thus, celebrity endorsement in advertisement and its impact on the overall brand is of great significance. In this process, the companies hire celebrities from a particular field to feature in its advertisement campaigns. The promotional features and images of the product are matched with the celebrity image, which tends to persuade a consumer to fix up his choice from a plethora of brands. Although this sounds pretty simple, but the design of such campaigns and the subsequent success in achieving the desired result calls for an in-depth understanding of the product, the brand objective, choice of a celebrity, associating the celebrity with the brand, and a framework for measuring the effectiveness.

Companies invest large sums of money to align their brands and themselves with endorsers. Such endorsers are seen as dynamic with both attractive and likeable
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qualities and companies plan that these qualities are transferred to products. Furthermore, because of their fame, celebrities serve not only to create and maintain attention but also to achieve high recall rates for messages in todays highly cluttered environments.

Aristotle said, Beauty

is a greater recommendation than any letter of

introduction. This could aptly summarize why innumerable products are endorsed
by celebrities, with or without a significant need or benefit from the same.

Similarly every product has an image. The consumer tries to consume a brand which has the maximum fit with his/her own personality/image. The celebrity endorser fits in between these two interactions, where he tries to bring the image of the product closer to the expectation of the consumer, by transferring some of the cultural meanings residing in his image to the product.

The model of Celebrity Endorsement, is essentially based on the theoretical framework of Classical Conditioning given by Pavlov.

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Upfront, this seems like a very effective weapon in mature and saturated markets, which differentiates products from those of the competitors by clearing the clutter and reaching the consumer.

But is the impact of

the celebrity endorsement so significant, or are the celebrities themselves adding to the clutter?
Through this paper we primarily try to evaluate the impact of any celebrity endorsement campaign on the consumer perception by analyzing it through a research work done on consumer behavior through on open interview of consumer, consisting of - brand, consumer and the celebrity.

If the world were full of all wise men and all wise women; we would have never heard of a term called advertisement . And then good products would have found the right customers and grown to prosperity. Firms would have worked out a mathematical formula to sell and succeed. But the buying process isnt rational; and so is this world.

Indians are die-hard movie and sport buffs; and this aspect of the consumers has invited the concept of Celebrity Endorsement to the world of advertisement. The purpose of this paper is to analyze the role of Celebrity Endorsement in the process of consumer behavior with respect to their perception towards a particular brand and its celebrity endorser by taking appropriate examples from the advertising landscape.

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1.2 SYNOPSIS

Successful branding programs are based on the concept of singularity. The

objective is to create in the mind of the prospect the perception that there is no other product on the market quite like your product.
- Al Ries & Laura Ries

Indian advertising started with the hawkers who used to call out their wares right from the days when cities and markets first began. With this evolved a strategy that tried to benefit from the emotional att achment of the admirers or the fans of the celebrities; in the form of celebrity endorsement. This paper tries to understand the process of consumer psychology and impact of celebrity endorsement on the overall process of consumer [perception. Any thoughtless adventure with the investment on celebrity and the brand association with the celebrity can be like the Sword of Damocles. If youre trying to persuade people to do something, or buy something, it seems to me you should use their language, the langua ge in which they think.

- David Ogilvy

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This paper rifles through the concept of celebrity endorsement and provides insights on what it is and how the increasing number of endorsements, throw a valid question to the consumers.

The general belief among advertisers is that brand communication mes sages delivered by celebrities and famous personalities generate a higher appeal, attention and recall than those executed by non -celebrities. The quick message-reach and impact are all too essential in todays highly competitive environment. Celebrities have also been in demand having succeeded in being effective by rising above the clutter & grabbing the attention and focus of the consumer. They also succeed in creating an aspiration in the minds of the consumer to acquire what their favorite celebrity en dorses.

1.3 DEFINITION OF CELEBRITIES

Celebrities are people who enjoy specific public recognition by a large number of certain groups of people. They have some characteristic attributes like attractiveness, extraordinary lifestyle or special skills that are not commonly observed. Thus, it can be said that within a society, celebrities generally differ from the common people and enjoy a high degree of public awareness.

According to Friedman and Friedman , a celebrity endorser is an individual who is known by the public for his or her achievements in areas other than that of the product class endorsed . Compared to other endorser types, famous people always attach a greater degree of attention, recall and loyalty.

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According to Melissa St. James , a doctoral fellow and marketing instructor at The George Washington University, Studies show that using celebrities can increase consumers awareness of the ad, capture [their] attention and make ads more memorable.

In this age of intense competition, where captur ing a position in the consumers mind space is extremely tough, celebrity endorsements give an extra edge to the companies for holding the viewers attention. Celebrities can catalyze brand acceptance and provide the enormous momentum that brands require by endorsing the intrinsic value to the brand through changing consumer perception with respect to the product because of celebrity and brand personality.

The term Celebrity refers to an individual who is known to the public (actor, sports figure, entertainer, etc.) for his or her achievements in areas other than that of the product class endorsed (Friedman and Friedman, 1979). This is true for classic forms of celebrities. Like,
Actors (e.g., Amitabh Bachchan, Shahrukh Khan, Aishwarya Rai,, Preity

Zinta, Aamir Khan and Pierce Brosnan).

Models (e.g., Mallaika Arora, Milind Soman, Naomi Campbell, etc),

Television Personalities (Husain, Smriti Irani, Sakshi)

Sports figures (e.g., Sachin Tendulkar, Sania Mirza, Anna Kournikova,

Michael Schumacher, Tiger Woods, etc),

Entertainers (e.g., Cyrus Broacha, Oprah Winfrey,),

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And pop-stars (e.g., Madonna, Shakira).

But also for less obvious groups like businessmen (e.g., Vijay Mallya, Bill Gates) or politicians celebrities appear in public in different ways. First, they appear in public when fulfilling their profession, e.g., Vishwanathan Anand, who plays chess in front of an audience . Furthermore, celebrities appe ar in public by attending special celebrity events, e.g., award ceremonies, inaugurations or world premieres of movies. In addition, they are present in news, fashion magazines, and tabloids, which provide second source information on events and the priva te life of celebrities through mass -media channels (e.g., Smriti Irani being regularly featured in various publications). Last but not least, celebrities act as spokes-people in advertising to promote products and services, which is referred to celebrity endorsement.

1.4 IMPORTANT CELEBRITY ATTRIBUTES

While selecting a celebrity as endorser, the company has to decide the promotional objective of the brand and how far the celebrity image matches with it. The selection is in fact a collaboration, from which both the company and the celebrity gains.

The most important attribute for a celebrity endorser is the trustworthiness . The target audience must trust that a celebrity carries a particular image and it must match with the product. The second attribute in order of importance is likeability . The celebrity also must be accepted as a popular icon by a large cross section of the audience.

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Similarity between the target audience and the celebrity is the third

important attribute. A person well -known in a society can have greater impact than a celebrity of a different world. If the endorser and receiver have similar needs, goals, interests and lifestyles, the position advocated by the brand communication is better understood and received. Similarity is also used to create a situation where the consumer feels empathy for the person shown in the commercial. The bond of similarity between the endorser and the receiver increases the level of persuasiveness.

Apart from that, expertise is also believed to be another im portant attribute.

Definition of Celebrity Endorsement

According to Friedman & Friedman , a celebrity endorser is an individual who is known by the public for his or her achievements in areas other than that of the product class endorsed. So, in the Coco-Cola advertisement; actor Amir Khan is the celebrity endorser for the product or brand called Coke, and this process is referred to as Celebrity Endorsement. Celebrities might endorse as a brand ambassador or a brand face.

Difference between Brand Ambassador & Brand Face

A Brand Ambassador would be one who is not only a spokesperson for the brand or is just appearing as a testimonial for the brands benefits. He/she is an integral part of the brand persona and helps to build an emotion, which goes beyond just appearing on TV commercials. He takes up the cause of a Brand Champion and is associated with every aspect related with the brand. What is more, there is a significant difference
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between making just an endorsement for say, a shampoo or an automobil e, and being that brands alter ego. Both parties take the latter far more seriously to the deal. So a brand ambassador would be involved in press releases, he/she would be actively participating in any sales promotion, sporting the Brand all the while. For example, Fardeen Khan is the brand ambassador for Provogue while he remains a brand face for Lux Body Wash.

On the other hand, a Brand Face would be the current celebrity who is just used as a tool to increase brand recall and is only appearing in the advertisement. It is usually seen that a brand face is a temporary contract and is very short term at times. An example would be Sona Chandi Chawanpryash using Sourav Ganguly for a while in its commercials. Brand faces are easily forgotten and fades away wit h the campaigns end

1.6 THE NEED FOR CELEBRITY ENDORSEMENT

The charisma of the celebrities almost always entices people and their words are worshipped by a lot of people. Their influence also goes on the political front, where they are invited for political endorsement. Eg. Hema Malini for B.J.P. , Govinda for Congress , Amitabh Bachchan for S.P.. When actor Shah Rukh Khan endorses Santro-Zip drive; the consumers are made to think that he is giving his opinion to go for this car. Similarly, actress Rani Muk herjee has turned the tables for Batas ladies footwear brand called Sundrop as sales increased by a whopping 500%.

Celebrity endorsements are impelled by virtue of the following motives: -

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Instant Brand Awareness and Recall

Celebrity values define, and refresh the brand image

Celebrity adds new dimensions to the brand image

Instant credibility or aspiration PR coverage

Lack of ideas

Convincing clients

1.7 WHY COMPANIES USE CELEBRITIES - THE CELEBRITY EDGE Psychological Factors: Celebrities generally satisfy the 'esteem
needs' of an individual. For example a movie actress is expected to possess a flawless skin and a blemish free face. Her fans want to know the secret of her beauty, so she becomes a natural endorser for beauty related products (cosmetics, soaps, powder).

propping Up Awareness and Trust Levels: Rahul dravid bob To Communicate a Certain Message about the
Company:
Sachin Tendulkar as brand ambassador gave it the desired facelift and image for the launch of 'Victor'

Value for Money:

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To Position their Brand Distinctively: Lux worldwide has positioned itself as the 'soap the filmstars use'. From Leela Chitnis to Aishwarya Rai, all top actresses have modeled for Lux. Celebrity Standing for a Single Brand:Think Zakir Hussain and you are reminded of 'Wah Taj' Taj Mahal tea. Ditto with A. R. Rahman for Airtel.
1.8 SCOPE OF CELEBRITY ENDORSEMENT
The use of testimonials by advertisers dates back to the 19 th century when medicines were patented. Firms have been juxtaposing the ir brands and themselves with celebrity endorsers (e.g., athletes, actors) in the hope that celebrities may boost effectiveness of their marketing and/or corporate communication attempts for at least a century. One of the early example is Queen Victorias endorsement of Cadburys Cocoa (Sherman, 1985). It was not until the 1920s, however, that advertisers used famous people for product endorsements.

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Actresses Joan Crawford, Clara Bow and Janet Gaynor were among the first celebrities to promote products (Fox, 1984). At that time, the rationale given by advertising agencies for using celebrities was the spirit of emulation (Fox, 1984, p.90). About a decade ago, one in three television commercials used celebrities endorsements (Business Week, 1978), and today this advertising approach appeared to be on the increase across all media types (Sherman, 1985 and Levin, 1988). Friedman (1977) found that celebrities are featured in 15 percent of the prime -time television commercials. In the United States, it was reported that about 20% of all television commercials feature a famous person, and about 10% of the dollars spent on television advertising are used in celebrity endorsement advertisements (Advertising Age, 1987; Sherman, 1985). Thus, celebrity endorsement has become a prevalent form of advertising in United States and elsewhere.

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Today, the use of celebrity advertising for companies has become a trend and a perceived winning formula of corporate image building and product marketing (Media, July-August 1997). This phenomenon is reflected by the recent market research findings that 8 out of 10 TV commercials scoring the highest recall are those with celebrities appearances .

Factors affecting buying behaviour

Price is the most important factor which effects the buying behavior of consumer, by which a consumer goes for the various segment of soap like premium, popular, sub-popular and carbolic which are basically decided by the cost factor and fat content in the soap.

The buying frequency is either monthly th at is done by the families or in case of bachelors it is more than once in a month. The occasions when premium soaps are purchased are usually when there are festivals and ceremonies. Moti Soaps are usually presented during festivals and occasions for pres ents and gifts.

The promotional techniques are used to boost sales. Various tactics like the price offs, buy one get two free, free gifts and other schemes help boost sales in short run and also help in clearing stocks.

One of the important points a soap marketer should note is that the soaps are usually purchased by women in urban areas as most of the day to day consumption of personal care products are made by women. A point to note is that women use more personal care product than men do and hence premium soaps are mostly targeted at them. Men normally make purchase

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decisions in rural areas. Hence the marketer has to adopt different strategy for such a market.

The market shows a seasonal behavior for some brands, i.e. the brands change as per the customers' need for that particular season. For e.g. in summer - running brand popular and sub -popular most of the buyer take bath twice in a day specially in northern belt, in monsoon - running brand antiseptic and medicated soap, in winter running brand premiu m (moisturizer and creamy soap).

Buyer

To a large extent, Premium Soap is a price sensitive market. Off late there has been an increasing trend towards down trading. And this has forced the manufacturers to lower the prices or offer temporary discounts to woo the consumers who are either down trading from the popular segment or graduating upwards from carbolic soaps.

This sector faces low level of brand loyalty. Switching costs is very low and these results in price war and people are concentrating on value-for-money. This forces a lot of players to go for frequent promotional schemes like 3 -on1, 2-on-1.

Earlier the decision for purchasing the soaps was equally balanced between man and woman (50:50).

Now the decision ratio is 60:40 in the favor of woma n purchaser. This proves the fact that today most soap is targeted at the Indian woman.

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The buyers, even in the rural area are subjected to the media invasion and are well informed about the basket of products available in the market and thus take a rational decision.

1.9 Celebrity Endorsement in India

Phase 1: The Pioneering Phase (1950-1980)
this phase was characterized by: 1. Limited channels of communication 2. Demand exceeded supply 3. Heavy regulation and governmental regulations some bigger companies from their global experience introduced the concept of celebrity endorsement. HLL has used Hindi film stars to endorse their beauty soap Lux since the fifties.

Phase 2: The Growth Phase (1980-1990)

the introduction of television added a variable effective medium of communication. Indian stars going global with events like Asiads and World Cup victory. Vimal, Thums-Up, Gwalior and Dinesh are some of the other brands that used star-appeal in the early days of mass advertising. There was a spurt of advertising, featuring stars like Tabassum (Prestige Pressure cooker), Jalal Agha (Pan Parag Pan -masaala), Kapil Dev (Palmolive Shaving Cream) and Sunil Gavaskar (Dinesh Suitings).

Phase 3: Globalisation
In highly competitive markets, the following realit ies about brand management exist:24

1. Product differentiating factors are duplicable and imitable. 2. All long existing and successful brands imbue their products with a meaning.

Chapter-2
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2.1LITERATURE REVIEW
1. Philip A. Stroke (2009): The use of celebrity endorsement as a part
of marketing Communication strategy has been gaining popularity over the past years. Money paid out by firms on endorsement contracts are estimated to be 10% to 25% of total advertising expenditures. However, emp irical evidence on the effect of endorsement announcements on the stock prices performance of firms has been mixed at best. We analyze the share market perception of celebrity endorsement using a unique sample of 102 announcements. Stock returns and tradin g volumes depends upon the level of press attention. Endorsements that appear in a major newspaper show higher average return and larger trading volume changes at announcement date than those announced on the corporate website only.
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2. Subhadip Roy (2007): This study raises three questions and attempts
to provide tentative explanations for them. The first two questions relate to locating, in the consumer's perceptual space, the relative position of Indian celebrities and brands on a set of personality attributes. The third question relates to determining the fit between the celebrity and the brands endorsed by her/him. The results suggest that consumers differentially rank both celebrities and brands. Specifically, Amitabh Bachchan ranks high on five personality attributes, and brands such as Pepsi and Coke rank high on four personality attributes. The study further shows that although celebrities may endorse several brands, their personality does not fit well with the personality of the brand they endorse. Evidence offered here supports the basic assumptions of the celebrityproduct congruence model.

3.Shimp(2007): A recent estimate indicates that almost 20 percent of all

advertisements worldwide use celebrity spokespersons. The general belief among advertisers is that messages delivered by celebrities provide a higher degree of appeal, attention, and possibly message recall than those delivered by non-celebrities. Marketers also claim that celebrities affect the credibility of the claims made, increase the me morability of the message, and may provide a positive effect that could be generalized to the brand.

4.Goldsmith et al.(2002): They assessed the impact of endorser and

corporate credibility on attitude toward -the-ad, toward the-brand and purchase intention. 152 adult consumers were surveyed who viewed a fictitious advertisement for Mobil Oil Company. They rated the credibility of the ads endorser, the credibility of the company and attitude towards thead, attitude towards brand and purchase intention. I t was observed that

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endorser credibility had its strongest impact on advertisement while corporate credibility has its strongest impact on brand .

5.Solomon et al. (2002) also talk about celebrities being most effective
in situations involving high social r isk, where the buyer is aware of the impression peers will have of him or her. According to him, a celebrity endorser is relatively more effective for products high in psychological or social risk, involving elements as good taste, selfimage, and opinion o f others, compared to a normal spokesperson. Expert opinions were considered most useful when the product endorsed was perceived to involve high, financial, performance, or physical risk.

6.Kambitsis et al., 2002): Celebrity endorsement is a billion doll ar

industry today with companies signing deals with celebrities hoping that they can help them stand out from the clutter and give them a unique and relevant position in the mind of the consumer. The reasons for using celebrity endorsement involve its potential to create awareness, positive feelings towards their advertising and brand. Advertisement featuring celebrity endorsement is often also perceived to be entertaining.

7.Pettitt (2000): Advertising is heavily used in process of personality

creation. This follow logically from the fact that personalities are particularly important for brand building. They provide unique associations with the brand and these associations acts as a stimulus for the customer to link their personality with the brand.

8.McGuire et al.(1999): Expertise is the perceived knowledge that the

source possesses, while trustworthiness is the degree to which the source is considered to be honest, ethical and believable. Both components are
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positively related to credibility, but the influence of one component can offset the effects of the other. For example, a spokesperson that is viewed as knowledgeable will be ineffective if he or she is perceived as lacking trustworthiness.

9.Henry(1999): Henry indicates that good PSAs are ones tha t are
empathetic, meaning they build trust with their audience or a sense of caring about the problem. He goes on to say that a good radio PSA is one that creates a mental picture of the subject with sound effects and a strong, credible spokesperson. In another article, he mentions that more than 11,000 radio stations in the USA, and around two -thirds of them use PSAs. It is also in accordance with Bonk et al. (1999).

10.Dwane Hal Dean (1999): He studied the effects of 3 extrinsic cues

viz. Third party endorsement, event sponsorship and brand popularity on brand/manufacturer evaluation. It was observed that endorsement significantly affected only product variables (quality and uniqueness) and one image variable (esteem). The third party endorsement hence may be preceived as a signal of product quality.

11.Sheth et al. (1999) argue that perception is shaped by the stimulus

characteristics (objects, brands, stories etc.), the context in which it is delivered (social, cultural), and the customer characteristic s (knowledge, experience, expertise). It is within these stages that a consumer will either recognize a fit between a celebrity and a product/brand, or reject this connection on different grounds. Memory is structured as an associative network.

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When this happen the brand and the celebrity become parts of each others association set

12.Till and Shimp(1998): Other research suggests that celebrity

endorsements might vary in effectiveness depending on other factors like the fit between the celebrity and the advertised product.

13.Tellis (1998) argues that consumers in a high-involvement situation

might actually be offended by the use of celebrity to endorse the brand. He also suggests that when there seem to be perceived high differences among competing brands, the consumer will perceive it as a high -involvement situation and put extra emphasis on information about the product more than being influenced by celebrity endorsers.

14.Lang and Goodwill (1997): PSAs are broadcasted by media outlets

in the public interest at no cost to nonprofit organizations. According to them, Public service announcements are a vital tool in generating awareness for critical issues while dispensing important information for many non -profit organizations. If produced correctly and distributed to the appropriate media outlets, PSAs help educate, inform, and motivate various publics on a variety of topics and issues (PSAs: Do They Really Work?). They, wrote that PSAs deal with life-and-death issues. They urge us to think about people with desperate conditions, act to help those in need and support causes that can change the world.

15.Freiden(1994):He concluded that celebrities are particularly effective

spokespersons because they are viewed as highly trustworthy, believable,

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persuasive, and likeable. A credible spokesperson is, other things being equal, more effective than a less credible spokesperson .

16. King (1991) argues that a good strategy to build strong brand equity is
to create an original metaphor for the brands pe rsonality. They talk about the factors involved in building a brand such as: Presence, Relevance, Differentiate, Credibility, and Imagery. The credibility factor especially has been looked at by several researchers in celebrity endorsement. The same has p resence and also to some extent imagery and differentiate. Relevance in this context can be looked at as a result of success in the other areas, as it concerns being perceived as relevant for the consumer.

17.Obanian(1990): developed a source credibility measure that

operationalizes credibility as consisting of the underlying dimensions of expertise, trustworthiness and attractiveness. The expertise and

trustworthiness dimensions are essentially identical to those identified in previous research and discussed above. However, the attractiveness dimension, unlike previous conceptualizations, is defined as the physical attractiveness of the source to the listener, and to a lesser extent, the emotional attractiveness of the source (Bearden and Netemeyer, 1999, p. 301). The advantage of this conceptualization lies in part in the extensive scale validation procedure undertaken by Ohanian.

18.Friedmen et al.(1976):Using advertisements with celebrities and

non-celebrities for a fictitious brand of sangria wine, found that the celebrity version of the advertisement had higher scores on probable taste, advertising believability, and purchase intention the three dependent variables. However, the wine was a fictitious brand, and the celebrity simply brought
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recognition to the name.The paucity of research comparing celebrity with non-celebrity spokespersons highlights the need for continued investigation into this area. It is important for advertisers to clearly understand both the pros and cons of using such individuals to represent their products, causes, or organizations; and ultimately the advertisers must assess the effectiveness of such a message.

19.Triandis (1971): Attractiveness has been conceptualized in terms of

similarity, familiarity, and likeability. Similarity refers to the perceived resemblance between the spokesperson and the audience. Familiarity represents the amount of knowledge that the audience has about the spokesperson. Likeability refers to affection for the spokesperson based on physical appearance, behavior or other personal traits.

20.Hovland et al. (1953): In encoding the message in the context of

celebrity endorsement, perhaps the most important decision to be made, besides choosing whether or not to use celebrity endorsers at all, is the choice of celebrity. Much research has been made in this area and several models have been made to explain and assist in the celebrity endorsement selection process.

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Chapter-3
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3.1 OBJECTIVE OF THE STUDY

The objectives of the study are as follows: To identify the influence of celebrity endorsement on consumer buying behavior with respect to his/her perception towards the brand . To study celebrity endorsement as a source of brand -building. To find which type of celebrity persona is more effective.

Need of the study:

After going through various sources like magazines, newspapers, websites I found that lot of research work has undertaken by researcher regarding impact of celebrity endorsement. But there was a gap in the res earch regarding whether celebrity endorsement act as a source of changing consumer perception towards the brand, so I decided to work on this particular aspect.

Scope of the study:

34

As due to time constraint it is very difficult to cover the entire sectors so I decided to cover FMCG sector, with toilet soaps and biscuits, as examples. The study is limited to Delhi NCR region only.

3.2 Research Methodology:

Research Design:
A research design is an arrangement of conditions for collection and analysis of Data in a manner that aims to combine relevance to the research purpose with Economy in procedure. It constitutes the blueprint for collection, measurement and analysis of data. My research design will be exploratory research design.

Data Sources:
In dealing with any real life problem it is often found that data at hand are inadequate, and hence, it becomes necessary to collect data that are appropriate. The researcher can collect data either through primary source or secondary source. a) Primary data : These are those data which are collected afresh and for the first time, and thus happen to be original in character. I will be using the structured questioners. b) Secondary data: These are those which have already been collected by someone else and which have already been passed through the statistical process. I will collect it from the sources like internet, published data etc.

Population of the study

People from Delhi/ NCR region will be included in the population .
35

Sample Size:
It is the total number of respondents targeted for collecting the data for the research. Sample size of 200 persons will be taken for this research.

Sampling Technique:
Random sampling technique will be used in this research project.

DATA PROCESSING
Daily data will be entered into MS-Excel sheets. After the exhaustion of the specified geographical area this data will be analyzed using simple graphical and tabulation techniques. The data sheets mentioned here will be attached in the annexure of the report.

Analytical Tools
After collection of data another work necessary for any data collector is to correctly analysis that data. So statistical tolls helps us to correctly analysis the data .As I will using here the software named Ms EXCEL for analysis of the data. I will use following statistical tools:

Hypothesis Testing
Chi-square test will be used when the set of observed frequencies obtained after experimentation have to be supported by hypothesis or theory. The test is known as 2 test of goodness of fit and is used to test if the deviation

between observation (experiment) and hypothesis may be attributed to chance (fluctuations of sampling).
2

also enables us to explain whether or not

two attributes are associated or related to each other.

36

To test the goodness of fit : It helps to test goodness of fit by using null and

alternate hypothesis.
STATISTICAL TOOLS TO BE USED 1. Chi Square Test Procedure:

(1) Set up the null hypothesis that there is no significant difference between the observed and expected value. (2) We compute the value of CHI- square by using the formula
CHI-square =
2=

(( Oi - Ei)2/Ei )

O- Observed value E- Expected value Degree of freedoms=(R-1)(C-1) Level of significance=5

37

Chapter-4
38

4.
The t ilet

I E S
et i esti

PI
ted t ,

S
t

Y
i l di small

imports. i dustan ever is, of ourse, the market leader. The market is littered over ith several, leading national and global hi h have limited ifebuoy, ux,

brands and a large number of small brands,

markets. The popular and premium brands include inthol, iril, exona, and irma. Toilet soaps, despite their divergent brands, are not

ell differentiated hich sustain

by the consumers. It is, therefore, not clear if it is the brand loyalty or experimentation lured by high volume media campaign,

them. A consequence is that the market is fragmented. It is obvious that this must lead to a highly competitive market. Toilet soap, once only an urban phenomenon, has now penetrated practically all areas including remote rural areas..

39

As the market is constituted now, it can be divided into four price segments: premium, popular, discount and economy soaps. Premium soaps are estimated to have a market volume of about This translates into a share of about as much as %. to %. , tonnes.

owever, by value it is

Market Segmentati n

Siz (In L kh Tonnes)

Pre Popular 15% Economy

19%

25%

41%

Soaps are also categori ed into men's soaps, ladies' soaps and common soaps. There are a few specialty soaps as transparent lycerine soaps, sandal soaps, specially flavored soaps, medicated soaps and baby soaps. Specialty soaps are high valued but enjoy only a small share of the market in value terms. The market is growing at % a year. This means that the incremental demand generation is % over and above the population growth. ith

increasing awareness of hygienic standards, the market could grow at a rate higher than % annually. Interestingly, % of the market is now

sourced from the rural sector. This means that the variance between the two segments is not very large. Since upper-end market focus is the urban areas, margins come from the urban sector.

40

scount

4. .

I E S

Lux soap was first launched in the K in as a flaked version of Sunlight soap. , and marketed as laundry Subsequently it was launched in the S in soap targeted specifically at 'delicates'. Lever Brothers encouraged women to home launder their clothes without fear of satins and silks being turned yellow by harsh lyes that were often used in soaps at the time. The flake -type soap allowed the manufacturer some leeway f rom lye because it did not need to be shaped into traditional cake-shaped loaves as other soaps were. The result was a gentler soap that dissolved more readily and was advertised as suitable for home laundry use. [ ] Lux is currently a product of nilever. The name "Lux" was chosen as the Latin word for "light" and because it was suggestive of "luxury." Lux toilet soap was introduced as a bathroom soap in the S in , and in as a brand extension of Lux soap flakes. Subsequently Lux the K in soap has been marketed in several forms, including handwash, shower gel and cream bath soap.

FIRST A OF L IN IN IA WITH L LA CHITNIS

41

Lux soap was launched in India in 1929. The very first advertisement in 1929 featured Leela Chitnis as its brand ambassador. It was branded in India as the beauty soap of film stars'. As of June 2009 Lux is sold in over 100 countries.

Celebrity endorsements
Hollywood

Since the 1930s, many well-known Hollywood actresses have marketed the soap to women as a beauty enhancer. Advertisements have featured Dorothy Lamour, Joan Crawford, Laurette Luez, Judy Garland, Cheryl Ladd, Jennifer Lopez, Elizabeth Taylor, Demi Moore, Sarah Jessica Parker, Catherine Zeta-Jones, Rachel Weisz, Anne Hathaway, and Marilyn Monroe, among others. The first male to star in a Lux advertisement was Hollywood actor Paul Newman

Bollywood

Today, the brand is still heavily advertised in India using Bollywood stars. Madhubala, Mala Sinha, Hema Malini, Sridevi, Madhuri Dixit, Juhi Chawla, Karisma Kapoor, Rani Mukerji, Amisha Patel, Kareena Kapoor and Tabu have all been past brand ambassadors . Aishwarya Rai and Priyanka Chopra are the present brand ambassadors of Lux. In India Shahrukh Khan was the first male in a Lux advertisement and he is now joined by Abhishek Bachchan.
Pakistan

Lux has been widely advertised in Pakistan ever since the brand was introduced. Pakistani models including Reema Khan, Meera, Aaminah Haq,
42

Babra sharif and various other leading models and actresses have been Lux models from time to time. Lux remains the leading soap brand in Pakistan, representing the stylish class of Pakistan. Things started with a TV show called Lux Style Ki Duniya, now with the country's leading models and actors taking part in the annual Lux Style Awards every year. Ali Zafar the famous Pakistani Singer has become the first male model for Lux.
Other countries

Lux soap is very popular in Nepal and the brand appointed Nepali model turned-actress Jharana Bajracharya to be the Lux Girl in the Summer of 2003. After that, she appeared on many TV commercials. Nigerian actress Genevieve Nnaji appeared as the face of Lux soap in 2004. Two decades earlier, singer Patti Boulaye had been Nigeria's face of Lux. In Norway during the 1950s and 1960s, Lux advertisements featured fictional Italian actresses. Lux soap is also a category leader in Pakistan, the brand being synonymous with glamour. While initially it was also marketed as the beauty soap of the film stars, recently it is focusing more on bringing out the star in ordinary people. Current brand ambassador is Iman Ali.

4.1.2 DOVE TOILET SOAP

Remember the Is it love? No its Dove ads? In the 1990s, when everything had to be low priced, consumer goods major Hindustan Unilever launched a Brand of soap that was considered expensive, frightfully expensive, for the times we lived in. For about Rs 30 for a bar, it was nearly twice as expensive as any toilet soap brand that was then sold in India. This was a time when hanging out for coffee was at the neighbourhood Udupi restaurant that charged Rs 6 for a serving and not the Barista where a mug of coffee cost Rs 50. To get consumers living with that mindset to graduate to a brand like Dove was a big leap. Certainly the well-travelled Indian consumer who had seen and touched the brand abroad were the first set that moved towards the brand for its superior and gentle on skin properties. Others who sampled the brand had mixed opinions. Occasionally you heard the sob story from a neighbour , on h ow a Dove bar got over in just four days, when the Rs 10 soap lasted for a month, giving rise to rather unkind remarks that Dove was moisturiser and love. This set of consumers used the bar for washing the face while a less costlier soap would be used for the rest of the body, a value-for-money approach.
43

From those use-for-special occasion days, Dove has come a long way. Last year, HUL executives claim that Dove has grown by 100% in shampoos and by 42% in soaps. Dove is the largest premium brand in the Hindustan Unilever portfolio, says Rajaram Narayanan, vice president, hair care and Lakme, HUL. Now the Dove portfolio delivers Rs 400crore in sales. Of this, the soap, or cleansing bar, as HUL executives would call it accounts for only Rs 200 crore. The rest comes from hair care, a category that Dove entered in India about two years back. The rise of modern trade formats and an evolving consumer has also ensured that even emerging categories like body washes and hair conditioners get more buyers. Dove has capitalised on this trend. Apart from distribution in modern format stores, where Dove claims to be one of the leading brands with 11.54% share, the brand has also entered adjacent categories. In body washes, Dove claims to be nearly 19% of the market, while hair conditioners gets the brand sales of around Rs 40 crore. All this has been a result of carefully managing the umbrella brand according to Rajaram, who says that the company was careful enough to not tamper with the core values right from the word go.
Dove did what it does best all over the world - not use supermodels to endorse the brand. Rather it got real women who used the product to give testimonials of their experience with the brand. In India, Doves brand team in the 1990s, led by Harish Manwani, now Unilevers president , Asia, Africa, Central & Eastern Europe, decided to adopt the same line of thought for the Indian market too. In some ways the brand was the opposite of Lux, the beauty bar of film stars. Dove showed beauty in ordinary people, says cinematographer and film director, Rajiv Menon, who was involved in making the earliest ads for Dove.

Studies showed that 57% of Doves Target audience was averse to regular advertising. Hence testimonials became even more critical fo r the success of the brand, say HUL executives. The team identified close to 50 women from upper middle class Indian households and handed them trial packs of Dove soap. After trying out the brand, their reactions were recorded and the most spontaneous responses (8 of them) were chosen to be the face of the brand. The testimonials did have the desired effect and soon the gentle effect that Dove had on skin was being recommended for babies as well in a way, baby care major Johnson & Johnson was finding an unlikely contender in Dove. .
44

Camera crews in Mumbai, Delhi and Bangalore asked women questions on hair care. In less than two weeks about 1,000 minutes of video footage was recorded and uploaded on popular portals. In a span of 9 days, over 250 women were interviewed and 1,000 minutes of footage recorded. This content when uploaded online elicited a huge response and according to HUL took the online involvement of consumers to a new high. As Rajaram points out, over the last few years Indian consumers have also been doing a lot of treatments to their hair. If consumers were not colouring their hair, they were straightening it. In the search for ideal elusive hair, one ends up damaging it, he says. This gave Dove the perfect platform to launch its shampoos, as the ideal brand that could repair damage. Then, other shampoo brands in the market were taking celebrities to endorse their brands or using the time tested imagery of kaale ghaney lambey baal. Dove decided to stay away fr om the stereotypes too and instead decided to focus on showing consumers their type of hair.

The faces that represent Hindustan Unilevers (HUL) biggest premium soap brand are not familiar. For, they represent 11 ordinary women who won Doves Real Women Face Test a campaign that received over 4,500 entries.

Thats Doves way of going off the beaten track in its communication strategy. Unlike other soap advertisements, the premium brand did not use the usual models or movie stars. Instead, it got real women who use the product to give testimonials of their experience with the brand.. The performance is creditable considering that at the time of its launch in India nearly 15 years back when everything was priced low HUL launched Dove that was double the price of any other premium brand. Pricing did put off customers initially and questions were raised about the soaps longevity. So what makes the brand tick? Typically, HUL uses an internal tracker called Living Standards Measure or LSM to gauge the performance of a product. LSM can range anywhere between one and 18 a higher score shows a higher living standard. On that scale, India is a LSM 3 nation with 70 per cent of the population in that range.
45

Heres a pointer to why HUL thinks Dove has a great future. On the LSM scale of six and above, Indias market is about 100 million strong and that number is far bigger than the population of some European countries. The skin cleansing category was more than Rs 7,700 crore in 2008, recording a growth of 11 .8 per cent. Within this category, the premium price segment is leading the pack with a 15.3 per cent growth rate. And unlike HULs other soap brands like Liril, Lux and Lifebuoy, which have undergone a series of relaunches, Dove has remained constant. Tho ugh it has gone in for brand extensions such as shampoos and deodorants , the brands core advertising proposition and premium positioning has remained the same. Consistency can indeed pay.

4.2 BISCUIT INDUSTRY

India Biscuits Industry is the largest among all the food industries and has a turn over of around Rs.3000 crores. India is known to be the second largest manufacturer of biscuits, the first being USA. It is classified under two sectors: organized and unorganized. Bread and bisc uits are the major part of the bakery industry and covers around 80 percent of the total bakery products in India. Biscuits stands at a higher value and production level than bread. This belongs to the unorganized sector of the bakery Industry and covers over 70% of the total production. India Biscuits Industry came into limelight and started gaining a sound status in the bakery industry in the later part of 20th century when the urbanized society called for ready made food products at a tenable cost. Bis cuits were assumed as sick-man's diet in earlier days. Now, it has become one of the most loved fast food product for every age group. Biscuits are easy to carry, tasty to eat, cholesterol free and reasonable at cost. States that have the larger intake of biscuits are Maharashtra, West Bengal, Andhra Pradesh, Karnataka, and Uttar Pradesh. Maharashtra and West Bengal, the most industrially developed states, hold the maximum amount of consumption of
46

biscuits. Even, the rural sector consumes around percent of the biscuits in the bakery products. The total production of bakery products have risen from . lakh tonnes in to . lakh tonnes in . Biscuits contributes to over percent of percent of the b iscuits are the total production of bakery and above manufactured by the small scale sector of bakery industry comprising both factory and non-factory units. T and the cost is The production capacity of wafer biscuits is s. , , with a motive power of K. . Indian biscuit industry ha s -60 percent of the entire bakery production. ew years occupied around back, large scale bakery manufacturers like cadbury, nestle, and brooke bond tried to trade in the biscuit industry but couldn't hit the market because of the local companies that produced only biscuits. The ederation of Biscuit anufacturers of India B I has confirmed a bright future of India Biscuits Industry. According to B I, a steady growth of percent per annum in the next 0 years will be achieved by the biscuit industry of India. Besides, the export of biscuits will also surpass the target and hit the global market successfully.

4. . P

It's a brand that has held its price line at s for years now -- the price by paise. So, it's not for nothing that Parle -G is the was last raised in world's largest-selling biscuit by volumes. ot that the company didn't try to raise prices to offset the overall hike in costs. Three years ago it did so, but quickly rolled it back after volumes fell sharply and consumers wrote to lodge their protest. " e want to cater to the masses and have consciously tried not to increase the price. Parle-G is available for s 0 a kg. There are very few food items that are available for s 0-60 a kg," says Pravin Kulkarni, general manager marketing), Parle Products. Parle is, of course, not doing it for charity. Soaring input prices meant it opted for reducing the weight of the biscuit than increasing the price -- first from 00 gm to . gm in anuary 008, and then to 88 gm in anuary this year -- in line with other biscuit -makers and G players.

47

Regular customers would have noticed the number of biscu its in a pack come down from 16 to 15 even as each biscuit became lighter, but they seemed to understand the cost pressures on the firm. The gamble paid off: Parle was able to sustain its volumes. Strict cost control at every point in its supply chain also helped -- Parle entered into forward contracts with suppliers, outsourced production, increased the number of manufacturing locations to 60 and consolidated buying. Raw material costs account for 60 per cent of the total costs in this segment and packaging costs (plastic films) account for 20-25 per cent of this. Nirmalaya Kumar, professor of marketing at London [ Images ] Business School, feels it's a very smart strategy. At this price point, price becomes more important than the weight of the biscuit. It's very interesting and similar to the dollar stores in the US, he says. But price is not its only USP. What makes the Parle G brand tick is also that it has been positioned on the health platform (a single pack of biscuit offers 450 calories). Its earlier punchline was Parle-G: swadh bhare, shakti bhare (full of taste and energy). Currently, the brand uses two punchlines. Parle-G: G for Genius and Hindustan ki Taakat (the country's strength). The brand, says Kulkarni, meets different needs of customers: calories (energy), nutrition and value -for-money -- enough reasons why Parle-G enjoys close to 70 per cent market share in the glucose biscuit category and probably has the deepest reach. It reaches 2.5 million outlets, including villages with a population of 500 people, on a par with Unilever's Lifebuoy, ITC's cigarettes or mobile pre -paid cards. It's also one of the few FMCG brands in the country, whose customers str addle across income segments.

48

The brand is estimated to be worth over s ,000 crore s 0 billion), and contributes more than 0 per cent of the company's turnover Parle Products is an unlisted company and its executives are not comfortable disclosing exact numbers). Last fiscal, Parle had sales of s , 00 crore s billion). ompetition has, of course, been trying to wean away customers from Parle. and Britannia [ Get uote ] relaunched its Glucose-D biscuit as Tiger in boasts of -18 per cent share, while ITC's Sunfeast glucose has captured 8 9 per cent, according to industry sources. Even Levers had forayed into this segment in 003 and launched a glucose biscuit branded as odern, after it acquired the bakery business of odern. There are strong regional brands, including Priya Gold west), Cremica north) and Anmol east).

But they still have their work cut out. irmalaya Kumar feels the Parle-G story is so fascinating that it deserves to be a case study. hat would be interesting to see is whether it will be able to retain its leadership in the coming years as income grows in the hinterlands and consumers upgrade and develop new tastes.

4. . I

E S

Biscuits and tea in the morning were a routine. So were the key market players and their favourite products. The two major players Britannia and Parle were busy biting of chunks of the national market among themselves, with a host of smaller brands in various regions.

49

While the business was still very competitive, there wasn't anything groundbreaking. In 2003, with ITC foraying into the segment, a lot of that changed. At that time, Britannia and Parle held, between them over 82 per cent of the market in value terms. The rest too was firmly held by smaller players like Priya Gold which had a strong presence in the north. So, in essence, the market already had strong well entrenched players. So how could a late entrant like ITC make its mark? Three years down the line, however, things have changed a lot. It is a classic story of the hare and the tortoise. While it is far from winning the race, slowly and steadily, the tortoise is gaining ground. The late entrant is already on the podium in the third place with as much as 7 per cent of the market in terms of value. ITC made hay when the sun wasn't shining, says a consultant who's been tracking the industry for a long time. But first, why did ITC train its eye on biscuits? Ravi Naware, chief executive, ITC Foods, makes it sound simple. We decided to enter the foods segment because it's a Rs 550,000 crore (Rs billion) market in INDIA]. But only 6 per cent of this is branded and packaged. In developed markets, nearly 95 per cent of the food market is branded and packaged. So there was lot of scope for a branded player. In foods, biscuits was tempting. The Rs 4,000 -crore (Rs billion) Indian biscuits market has grown at 12-14 per cent year-on-year. Then, there was a business synergy. ITC was already value-adding to wheat with its branded atta presence. By entering the biscuits segment, it could also improve its bottomline further. But despite the fast growth rates, the biscuits industry was not all rosy. Over the years, even giants like Hindustan Lever] had failed. For instance, HLL which had flirted with biscuits under the Max brand exited in 2005. But ITC's Sunfeast has a different story to tell so far. the strategist looks at the gameplan of a late entrant and how the biscuits industry has responded.
New recipe

Before entering the segment, ITC dug into market research. Research revealed that the category had gaps w hich ITC could settle into. Findings revealed that consumers wished to taste new and innovative products. That was precisely what the competition had not done in a big way. Says Naware, The biscuits industry had witnessed little innovation; Glucose was Glucose and Marie was still Marie. The company decided that this could be its biggest point of attack. In 2003, ITC launched Sunfeast with six ranges.
50

But it was a calculated risk. ITC stuck to category favourites like Glucose, arie and Bourbon cream. Along with that, it also launched innovations such as orange -flavoured arie, arie light and butterscotch -flavoured cream biscuits. In 004, Sunfeast followed this up with the launch of Sunfeast ilky agic. ore recently, it also has launched the Sunfeast Snacky and Sunfeast Golden Bakes. Analysts believe that just because Sunfeast was a new brand, helped matters. Says a consultant, "The biscuits industry had not witnessed any major product innovation in years. Consumers were just waiting for something new, something fresh, when Sunfeast ha ppened." Even the competition had not made things better. Between 000 and 005 neither Parle nor Britannia launched any major new product. Yes, Britannia did re-launch its Tiger brand in 005. In 005, before Diwali Britannia launched ccasions -- boxes of assorted biscuits priced between s 50 and s 00 -- which the company claims has

been very successful. Key allenges

Back in 003, nobody thought Sunfeast would have consumers eating out of its hands. Says aware, "Seven per cent in less than three years is something that we could have only dreamt about." Importantly, industry barometer AC ielsen has indicated that both Parle and Britannia are losing market shares. According to the AC ielsen retail sales audit in arch 006, both Britannia and Pa rle have lost volumes. Britannia's shares have dropped from 35.8 per cent in 004 -05 to 30.5 per cent in ay 006 volumes). Parle's shares have also dropped from 42.2 to 38.4 per cent in the same period. Even Priya Gold has seen a minor dip from 6.4 per cent to 5 per cent. ITC's Sunfeast has been a big gainer with its share increasing from 2. to 6. per cent.
51

In terms of value, Britannia leads the market with 37 per cent market share, followed by Parle's 31.3 per cent and ITC's 6.3 per cent. Neverthel ess, the gap is still wide. Sunfeast still has a long way to go. But what can the bigger players do? Alagh has an interesting observation. Says he, Biscuits have always been a low margin, high volume game. Both Britannia and Parle have very high volumes and can easily afford to lower their margins. A potential after-effect? Sunfeast too may have to drop its prices to be in the reckoning and this will squeeze its margin even lower. While the full game is yet to be played out, for the moment the sun seems to be shining on Sunfeast.
Creaming the market. . .
y

Innovation in the product line -- biscuits with butterscotch cream with actual granules in the cream, strawberry cream with flavour -enhancers and orange-flavoured marie. Gained an edge from the well established distribution network of its tobacco business. Signed up big film stars like Shah Rukh Khan and southern star Surya as brand ambassadors for Sunfeast. Branded the WTA tennis tournament with promos starring tennis s tars, Mahesh Bhupati and Sania Mirza.

. . . needs further embellishments

y

Big brand ambassadors, but not strong enough advertising campaigns for big brand recall. The gap between the number three and the top two slots is too wide. Competitors can play the low price game as they have volumes to support.

y y

52

apter-6

6. 6. .
E
Most

I I E S P
ESP

YSIS

E
of the

E
were

respondents

females with 65% of response while males being 35% respondents.

53

ESP

Most of the respondents, with 47%, were 37 or above of the age, then comes 23-27, 18-22, 33-37 and 2832 years of age of respondents. hich means a good blend of respondents was being surveyed.

ESP

Major proportion of respondents was home makers, were the while 2 nd businessman/women

most responding consumers followed by service class, students and others.

4)

PI

Most of the respondents with 52% use lux while cinthol is being used by 23%

consumers, Dove being used by only 13% consumers.

54

5)

YI

VI

Though celebrity endorsement is the major factor but it does not make any great difference to people as brand name is almost equally important, as 28% consumer prefer buying those product that are being endorsed by celebrities, while 27% consumers said it is the brand name which makes the difference.

6) P

ESI E S

SEE

E E

IES E

SI

a major chunk of respondents with 45%, celebrity replied that yes endorsing their

they would like to see a

product as it gives them a satisfaction of using a well known brand but 39%

respondents made sure that they do not want so while 16% respondents were indifferent towards this.

7) P

PE P E S P MOTE Y SOME E E

S TY

EI

47% respondents agreed with the fact though good number of respondents with 30% said that they do not agree with the fact. YPOTHESIS TESTI

55

Step1: State Hypothesis: Ho: elebrity endorsement doesnt a ect purchase decision o toilet soap brand. Ha: Celebrity endorsement affects purchase decision of toilet soap brand. Step : Set the ejection criteria: DF = 5-1 = 4 At alpha .05 and 4 degrees of freedom, the critical value from the chi square distribution table is 9.49 Step : ompute the Test Statistics: E pected 20 O-E) -4 O-E)^2/E O-E)^2 16 O-E)^2/E 0.8

Pre erence Observed Strongly agree Agree Strongly disagree Disagree Indifferent 30 5 47 2 16

20 20

27 -18

729 324

36.45 16.2

20 20

10 -15

100 225

5 11.25 G2=69.7

Interpretation: As the Chi-square test statistics 69.7 exceeds the critical value of 9.49 hence null hypothesis is rejected and hence we reached at the result that our alternative hypothesis is accepted. ence it can be concluded that celebrity

endorsement affects purchase decision of toilet soap brand.

8)

OES E E P RCHASE
A great respondents

TY E
number with

ORSEME T
of

E T MY

52%

responses agreed to the fact

56

while 23% respondents said that they do not agree to the fact.
HYPOTHESIS TESTING Step1: State Hypothesis : Ho: Celebrity endorsement doesnt affect my purchase decision of toilet soap brand. Ha: Celebrity endorsement affects my purchase decision of toilet soap brand. Step 2: Set the Rejection criteria:

DF

5-1

At alpha .05 and 4 degrees of freedom, the critical value from the chi square distribution table is 9.49
Step 3: Compute the Test Statistics: Preference Observed Expected = (O -E)^2/E (O-E)^2 (O-E)^2/E

(O-E)

Strongly agree Agree Strongly disagree Disagree Indifferent

16

20

-4

16

0.8

47 2

20 20

27 -18

729 324

36.45 16.2

30 5

20 20

10 -15

100 225

5 11.25
G2=69.7

Interpretation:

As the Chi-square test statistics 85.3 exceeds the critical value of 9.49 hence null hypothesis is rejected and hence we reached at the result that our alternative hypothesis is accepted. Hence it can be concluded that celebrity endorsement affects purchase decision of toilet soap.

9) WHICH CELEBRATY PERSONA DOES CONSUMER LIKE TO ENDORSE THIER PRODUCT?

57

Bollywood first

star

are

consumers

preference

with 58%, as the endorser of their soap brand while a good number of respondents with 20% want television stars then comes sports stars with 19% of responses. HYPOTHESIS TESTI Step1: State Hypothesis: Ho: People like to see sports stars as the endorser o their products. Ha: people like to see bollywood stars as the endorser of their products. Step2: state the rejection criterion DF=5-1=4 At alpha .05 and 2 degrees of freedom, the critical value from the chi square distribution table is 9.49 . Pre erence Bollywood stars Tv stars Sports stars Social workers thers 1 20 -19 361 18.05 20 19 2 20 20 20 0 -1 -18 1 324 -------0.05 16.2 Observed 58 E pected 20 O-E) 38 O-E)^2 1444 O-E)^2/E 72.2

10) CORRECT RECALL OF THE TAGLI ES

The first ad was correctly recogni ed by more than 80% consumer, the brand which was endorsed by most
58

of the bollywood stars, while the second most correctly recogni ed ad was the third option which is again being endorsed by a bollywood star, Katrina Kaif. hile the ratio of correct to wrong recognition was very low in case of

other brands which are not being endorsed by any celebrity.

6.1.2 ISCUITS 1) GE
ER OF THE RESPONDENT

Most of the respondent with 62% was females while only 38% were male.

59

2) AGE OF THE RESPONDENT

The survey was done with a mixed age group with 26%, 23%, 21%, 20%, 10%, of 1825, 34-41, above 40, 26-33 and below 18 years of age respectively.

) OCCUPATION OF THE RESPONDENT

Majority of the respondents were home makers while a good no of and being

businessmen/women students surveyed. were also

4)

RAND OF THE
Maximum respondents consumes

ISCUIT IN USAGE
of 38% biscuits

number with sunfeast

which are being promoted by Shahrukh Khan, while 31%

replied that they consume Parle g, 24% respondents consume tiger and 6% and 1% of

respondents replied that they consume milk shakti and other brands respectively.
60

5) FACTORS AFFECTING THE

39% of the respondents replied i.e. the maximum number of respondents said that its the Brand ame which makes the

UYING

EHAVIOUR

difference and 33% of the respondents said that taste is also the factor which let them make the purchase, while price and celebrity endorsement make 16% and 12% respondents respectively to buy the biscuits.

6) DESIRE TO SEE ANY CELE RATY ENDORSING THE RANDS

Most of the consumer with 38% would like to see some celebrity endorsing their product, while 29% do not and 33% are indifferent towards it.

7) DO PEOPLE PREFER ARE EING PROMOTED

UYING THOSE PRODUCTS THAT Y SOME CELE RATY

43% respondents agree to the fact with 13%, who strongly agree fact while while 40% 3% of the

respondents disagree to the strongly

disagree, while 1% consumers were indifferent towards it. HYPOTHESIS TESTING

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Step1: State Hypothesis: Ho: Celebrity endorsement doesnt a ect purchase decision o biscuit brand. Ha: Celebrity endorsement affects purchase decision of biscuit brand . Step 2: Set the Rejection criteria: DF = 5-1 = 4 At alpha .05 and 4 degrees of freedom, the critical value from the chi sq uare distribution table is 9.49 Step : Compute the Test Statistics: = O-E)^2/E O-E)^2 49 529 361 400 289 O-E)^2/E 2.45 26.45 18.05 20 14.45 G2=81.4 Interpretation: As the Chi-square test statistics 81.4 exceeds the critical value of 9.49 hence null hypothesis is rejected and hence we reached at the result that our alternative hypothesis is accepted. ence it can be concluded that celebrity endorsement affects purchase decision of biscuit brand.

PREFERENCE OBSERVED EXPECTED O-E Strongly agree Agree Strongly disagree Disagree indifferent 13 43 1 40 3 20 20 20 20 20 -7 23 -19 20 -17

8) DO I PREFER BUYING THOSE PRODUCTS THAT ARE BEING PROMOTED BY SOME CELEBRATY
Maximum number of the

respondents with 48% agreed that they prefer to buy those products that are being
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promoted by some celebrities with 12% who strongly agreed, while 35% disagreed with the fact, while 2% strongly disagreed.

HYPOTHESIS TESTING Step1: State Hypothesis : Ho: Celebrity endorsement doesnt affect my purchase decision of biscuit brand. Ha: Celebrity endorsement affects my purchase decision of biscuit brand. Step 2: Set the Rejection criteria:

DF

5-1

At alpha .05 and 4 degrees of freedom, the critical value from the chi square distribution table is 9.49
Step 3: Compute the Test Statistics: Preference Observed Expected = O-E (O -E)^2/E (O-E)^2 (O-E)^2/E

Strongly agree agree Strongly disagree Disagree indifferent

12

20

-8

64

3.2

48 2

20 20

28 -18

784 324

39.2 16.2

35 3

20 20

15 -17

225 289

12.25 14.45
G2=85.3

Interpretation :

As the Chi-square test statistics 85.3 exceeds the critical value of 9.49 hence null hypothesis is rejected and hence we reached at the result that
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our alternative hypothesis is accepted.

ence it can be concluded that

celebrity endorsement affects purchase decision of biscuit brand.

9)

hich celebrity persona does consumer pre er to endorse their product?

Maximum respondents number likes to of see

bollywood stars while just a few lesser then them likes to see TV stars as their endorser. HYPOTHESIS TESTING Step1: State Hypothesis: Ho: People like to see sports stars as the endorser o their products. Ha: people like to see bollywood stars as the endorser of their products. Step2: state the rejection criterion DF=5-1=4 At alpha .05 and 2 degrees of freedom, the critical value from the chi square distribution table is 9.49 . Pre erence Bollywood stars Television stars Sports stars Social workers thers Observed 39 29 21 10 1 E pected 20 20 20 20 20 O-E 19 9 -9 -10 -19 O-E)^2 361 81 81 100 361 O-E)^2/E 18.05 4.05 4.05 5 18.05 G2=49.2
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Interpretation: As the Chi-square test statistics 49.2 exceeds the critical value of 9.49 hence null hypothesis is rejected and hence we reached at the result that our alternative hypothesis is accepted. ence it can be concluded that people

like to see bollywood stars endorsing their products rather than sports stars.

10) CORRECT RECALL OF THE TAGLINES

The first ad was correctly recogni ed by maximum number of respondents, with 91% consumer, most while the

second

correctly

recogni ed ad was the third option which is being

endorsed by a bollywood star, Shahrukh Khan. hile the

ratio of correct to wrong recognition was very low in case of other brands which are not being endorsed by any celebrity.

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66

Chapter-7

7.1 Summary:
Celebrity endorsement is a method employed by marketers as a promotional tool so that people can associate themselves with the product as they associate themselves with the celebrity endorser. Companies spend huge amount of money to rope in such celebrities so as to endorse their brands. They generally determine their effectiveness by measuring ROI. Lot of studies conducted on celebrity endorsement but no one clearly indicated whether it can act as a source of brand-building. So a research was conducted on this particular aspect. It wasnt possible to concentrate this study on the entire sectors so FMCG sector was selected. Primary data was collected through structured questionnaire and sampling unit was Delhi. Secondary sources were also used in the beginning so as to gain an insight of the problem.
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After carrying it was found that female celebrities are better than that of male celebrities. People love to see film stars or TV actors/actresses endorsing FMCGs than that of sports stars. It was found that celebrity endorser affects people intention regarding purchase of the FMCGs and celebrity endorsement acts as a source of brand-building.

7.2 Conclusion:
Despite the obvious economic advantage of using relatively known

personalities as endorsers in advertising campaigns, the choice of celebrities to fulfil that role has become common practice for brands competing in today's cluttered media environment. There are several reasons for such extensive use of celebrities. Because of their high profile, celebrities may help advertisements stand out from the surrounding clutter, thus improving their communicative ability. A brief assessment of the current market situation indicates that celebrity

endorsement advertising strategies can, under the right circumstances, indeed justify the high costs associated with this form of advertising. But it would be presumptuous to consider celebrity endorsement as a panacea for all barricades. Celebrity endorsement if used eff ectively, makes the brand stand out, galvanizes brand recall and facilitates instant
68

awareness. To achieve this, the marketer needs to be really disciplined in choice of a celebrity. Hence the right use of celebrity can escalate the Unique Selling Proposition i.e. it can act as a source of brand-building of a brand to new heights; but a cursory orientation of a celebrity with a brand may prove to be claustrophobic for the brand. It was found that people love to see celebrities endorsing their brands so the involvement of common man is pretty high with these celebrities. So marketers should use the right celebrity matching with the product. During survey it was found that female celebrities are considered to be better celebrity endorser than that of their male counterparts in case of FMCG, this is because in case of FMCGs, the involvement during purchase of mothers is very high, hence a female endorser suggesting a product leaves an impression on the mothers mind. Also it was found that people love to see bollywood and TV stars endorsing their product or brand than sports stars. This is because in India, bollywood stars are worshiped as gods . But celebrity endorsement is not the end of the story, todays consumer has become very clever and clear regarding what he/she wants? and he/she does not blindly follow his/her ideal, but ha also looks for the brand and the features of the products. Infact brand, its quality and features are the foremost important things that he/she looks for in a product. At last I just want to say A celebrity is a means to an end, and not an end in him/her.

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7.3 Limitation:
There are following constraints of the study which can be explained as: the time of research was short due to which , many fact has been left untouched.

The Area undertaken in research is Delhi region. But to do a complete research a wide area is required, so the area is also a constraint of the study.

Sample for the study taken is of only 100 consumers, which was also a constraint for the study.

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While collecting data some of the respondents were not willing to fill the questionnaire, so they might not fill their true behaviour. This can also be a constraint of the study.

7.4 Recommendations:
After studying impact of celebrity endorsement on consumer perception on FMCG sector and as a source of brand-building I want to suggest following recommendations:  Through the study it was revealed that the consumers were able to recognize the LUX ad with sone se bhi sona lage and VIVEL ad with khoobsurti bas me, duniya kadmo me taglines and similar was the case with biscuit brands, but consumers were also able to recall those ads which do not had any celebrities like G mane Genius ad of parleg, hence marketers should focus on creating ads which communicate some message and leaves some impression on the consumers rather than concentrating on signing the celebrities as endorsers.

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 This study reveals that celebrity endorsement act as a source of brand-building but it isnt the complete solution. Company cant rely only on celebrity endorsement to sell their products but they should follow an integrative approach so as to generate good sales volumes. They should provide more schemes to their customers in order to sell their products.

 One of the important recommendations that I want to give is that during this slowdown period companies are cutting their advertisement expenditure but they shouldnt do this. This is because this slowdown provide them an opportunity to differentiate themselves from their competitors. This is also supported by the researches. One of the research explained that during 1960s recessions 290 global

companies increased their advertisement expenditure and their sales increased by whopping 300%. Some of the companies are well established brand name todays like IBM, Microsoft, 3M etc.

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Chapter-8

73

8 ANNEXURE

8.1 BIBLIOGRAPHY
1. http://www.itcportal.com/the_itc_profile/ads/ad.htm, 22.11.2009 2. http://www.hul.co.in/brands/personalcarebrands/Dove.aspx , 10.12.2009 3. http://www.hul.co.in/aboutus/ourhistory/ , 10.12.2009

4. http://www.itcportal.com/the_itc_profile/history_evolution.ht ml, 12.12.2009 5. Advertising and Sales Promotion by S.H.H.KAZMI and SATISH K BATRA. 6. http://economictimes.indiatimes.com/features/brandequity/The-secret-of-Doves-success/articleshow/5095968.cms,
30.12.2009

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8.2 QUESTIONNAIRES 8.2.1 Questionnaire regarding toilet soap consumption

Dear Respondents,

This questionnaire will be strictly used for the purpose of business research conducted for academic purpose only. No information provided by the volunteers would be used otherwise.

1) Name of the respondent__________________ 2) You are: Male 3) Your age is: 18-22 28-32 38 or abov 4) Your occupation is Student Businessman/Businesswomen Others 5) Which toilet soap you are using currently? Lux Cinthol Other, Please mention_____________________ 6) What factor affects your buying behavior toward your purchase? Price Celebrity endorser
75

Female

23-27 33-37

Service class Home Maker

Dove Santoor

Fragnance Brand name

7) Do you like to see any celebrity endorsing your brand on television? Yes Doesnt matter 8) People go for such products which are being promoted by some celebrity endorser. Rate this statement: Strongly agree Indifferent Strongly disagree 9) Celebrity endorsement affects my purchase decision while purchasing toilet soaps. Rate this statement: Strongly agree Indifference Strongly disagree 10) Out of the following celebrity persona whom do you like most? Bollywood Stars Television Stars Sports star Social Workers Agree Disagree Agree Disagree No

Others, please mention_________________________ 11) Do you follow your favorite celebrity while purchasing new toilet soap every time? Every time Seldom Often Never

12) You are required to identify the following ads regarding various toilet soaps: Sone se bhi sona lage, salona mera yaar : __________________________ Mummy, phir se class me first:___________________________________ Khoobsurti bs me duniya kadmo me_______________________________ . _________________________________________ ______its not just soap.
76

13) Any suggestions regarding advertising campaign of toilet soap, kindly mention: ____________________________________________________________________ ____________________________________________________________________ ____________________________________________________________________ ______________________________

Thank you for spending your precious time, HAVE A NICE TIME AHEAD.

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8.2.2 Questionnaire regarding biscuit consumption

Dear Respondents,

This questionnaire will be strictly used for the purpose of business research conducted for academic purpose only. No information provided by the volunteers would be used otherwise.

1) Your name is _______________________________________ 2) You are: Male 3) What is your age? Below 18 26-33 Above 41 4) Your occupation is Student Businessman/ Businesswoman Others 5) Which biscuit brand you are currently consuming? Parle-G Tiger Other, Please mention_____________________ 6) What factor affects your buying behavior toward your purchase? Price Celebrity endorser Taste Brand name Sunfeast Milk Shakti Service class Home Maker 18-25 34-41 Female

7) Do you like to see any celebrity endorsing your brand on television? Yes Doesnt matter
78

No

8) People go for such products which are being promoted by some Celebrity endorser. Rate this statement: Strongly agree Indifference Strongly disagree 9) Celebrity endorsement affects my purchase decision while purchasing biscuits for my family. Rate this statement: Strongly agree Indifference Strongly disagree 10)Out of the following celebrity persona whom do you like most? Bollywood Stars Television Stars Sports star Social Workers Agree Disagree Agree Disagree

Others, please mention_________________________ 11) Do you follow your favorite celebrity while purchasing new biscuit packet every time? Every time Seldom Often Never

12) You are required to identify the following ads regarding various biscuits: G maane genius:_______________________________________________ Jam ke khao, kuch ban ke dikhao:___________________________________ Power of milk and goodness of honey_______________________________ Kho jao ________________ki duniya me

79

13) Any suggestions regarding advertising campaign of toilet soap, kindly mention: ____________________________________________________________________ ____________________________________________________________________ ____________________________________________________________________ ______________________________

Thank you for spending your precious time, HAVE A NICE TIME AHEAD.
__________________________________________

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