CHAPTER 1: INTRODUCTION

1. 1. Background to the Topic

In this era of globalization and modernization many industries are getting advanced in
terms of coming up with innovative ideas, fashion industry and cosmetic industry are
booming ones. On the other hand marketers are also coming up with different attractive
ideas to grab the attention of viewers and their target market towards the purchase and
repurchase of their products, celebrity endorsement is one of those techniques. Individuals
are trying to follow the lifestyles of their most loved celebrity and this makes an awesome
effect on their purchasing behavior towards the endorsed brand. This increases market
share of that brand and eventually improves organization’s profitability. Celebrities’
presence has a great impact on customers picking of such brands when they are on
shopping. We try to use those things or brands which our favorite celebrities use so that
we get resemble with our loved celebrities.

1. 2. Introduction to Topic

CELEBRITY
Celebrity is the fame and public attention accorded by the mass media to individuals
or groups or, occasionally, animals, but is usually applied to the persons or groups of
people (celebrity couples, families, etc.) themselves who receive such a status of fame
and attention. Celebrity status is often associated with wealth (commonly referred to
as fame and fortune), while fame often provides opportunities to earn revenue.
The celebrities are:
 Actors
 Models
 Sports persons
 Entertainers
 Pop star
 Business man
 Politician
 Fictional celebrities
 Motivational speakers
 Authors

1
Successful careers in sports and entertainment are commonly associated with celebrity
status, while political leaders often become celebrities. People may also become
celebrities due to media attention on their lifestyle, wealth, or controversial actions, or
for their connection to a famous person.
A Celebrity is a person, who has a prominent profile and commands some degree of
public fascination and influence in day-to-day media. A Person with great popular
appeal, prominence in a particular field, and is easily recognized by the general public.
Various careers within the fields of sports and entertainment are commonly associated
with celebrity status. While people may gain celebrity status as a result of a successful
career in a particular field (primarily in the areas pertaining towards sports and
entertainment), in other cases, people become celebrities due to media attention for
their extravagant lifestyle or wealth for their connection to a famous person or even
for their misdeeds (as in the case of a well-known criminal). Celebrities may be known
around the world (e.g., pop stars and film actors), within a specific country or within
a region. 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. In this age of intense
competition, where capturing 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.

CELEBRITY ENDORSEMENT
Celebrity endorsement is a form of advertising campaign or marketing strategy used
by brands, companies, or a non-profit organization which involves celebrities or a well-
known person using their social status or their fame to help promote a product, service
or even raise awareness on environmental or social matters. Marketers use celebrity
endorsers in hopes that the positive images of the celebrity endorser of the brand will
also be passed on to the products or the brand image associated with the celebrities.
Celebrity endorsement is usually commonly used by fashion or beauty brands, but a
non-profit organization relies on celebrities as well, as celebrities have mass
communication skills which can attract people's attention and is helpful in reaching a
wider audience to raise their awareness towards a certain organization or an issue, thus
making celebrities effective fundraisers. Celebrity Endorsement was initiated mid 80’s
in India. One of the first sports endorsements in India was when Farokh Engineer
became the first Indian Cricketer to model for Brylcream. The Indian cricket team now
earns roughly Rs. 100 crore through endorsements.
Kotler (2006) defines celebrity endorsements in very simple terms; Kotler explains that
celebrity endorsement is a particular strategy used by marketers to advertise a product
from such a platform through which consumers can associate themselves with the brand
value from the perspective of the celebrity personnel. In India a celebrity idolizes in the
mind of the consumer so large that any activity can be capitalized on their huge fan

2
followers. Therefore the huge and binding relationship between celebrity endorsement
and consumer behavior cannot be ignored or undermined in a competing business
environment like India.

Usage.
Using well-known and admired people to promote products is a widespread
phenomenon with a long marketing history. The rationale behind these strategies is that
a famous person can draw attention to a brand and shape the perceptions of the brand
by virtue of the inferences that consumers make based on the knowledge they have
about the famous person.
Consequently, in choosing a celebrity endorser, it is important for the celebrity to be
well enough known that the awareness, image, and responses for the brand may be
improved. In particular, a celebrity endorser should have a high level of visibility and
a rich set of potentially useful associations, judgments, and feelings. Ideally, a celebrity
endorser would be seen as credible in terms of expertise, trustworthiness, and likeability
or attractiveness, as well as having specific associations that carry potential product
relevance.
Kelkar (2008) states that in the past also a number of different brands have created
strong associations with celebrities that have served as sources of brand equity, and this
has actually done wonders for these firms.
In India quite a few companies that market FMCG products are using popular sports
persons and film stars in their advertising to endorse their products. Sachin Tendulkar,
Rahul Dravid, Saurav Ganguly, Amitabh Bachchan, Shahrukh Khan, Salman Khan,
Katrina kaif and many others are a common sight in ads; the list goes on and on.
Companies expect to derive three types of benefits from endorsers:
 Endorsers increase viewing of TV ads and readership of newspapers and
magazines.
 Endorsers can influence positive attitude changes towards a company and its
brands because of their credibility.
 Endorser‘s perceived personality characteristics can get associated with a
brand‘s imagery.
Consumers associate varying degree of credibility with different information
sources. It is believed that the more credible the source, the more persuasive the
endorser is likely to be influencing the acceptance of ad message by the audience.
Endorsers in ads are viewed as a source of information and influence audience‘s
acceptance of message content because of their credibility and attractiveness. Besides
this, it is also believed that endorsers possess some symbolic attributes which
consumers associate with the brand. By purchasing, owning and consuming those
brands, consumers see themselves as possessing those desired attributes. There was a
news article that a youngster died while trying to emulate a risky jump taken by Salman
Khan in an ad of Thums-Up. Coca-Cola ads use endorsers who portray an image of
being young and modern.

3
While companies are investing huge sums of money into the concept that sports people
of today and yesterday are good endorsers, they are also recognizing that choosing a
celebrity endorser is no longer a matter of personal taste. Several companies have
learned it the hard way that high priced endorsers have been suspected of involvement
in messy scandals and controversies. The cricket match fixing suspicions have
seemingly put the wrong kind of limelight on some famous sports persons who were
endorsing some multinational brands.
Due to the competitive environment in which companies are working on, doing an
effective communication is definitely one of the key issues to catch the attention of the
consumers and there are a variety of communication strategies, which allow the
advertisers to reach their target. The use of celebrities as spokespersons is becoming an
increasingly common strategy in the advertising industry. For example, in the India,
approximately 25% of all television ads feature one or more celebrities and almost 10%
of all money spent on advertising go to celebrities in different advertisements. Millions
of rupees are spent on celebrity endorsement contracts to make the communication
process more effective and convincing.
The modern world of marketing communication has become colorful 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.
The use of advertising went through a major phase of change over the past 150 years,
from classical to modern view. In the modern days, marketers are developing strategies
using various appeals including sexual, emotional, humour etc. The motive behind
formulating such strategies is to gain high brand exposure, attention, interest, desire and
action. Thus, celebrity endorsement in advertisement and its impact on the overall brand
is of great significance.
In this modern era, 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. In order to do this, marketers employ
well known and famous personalities in other word celebrities. As McCracken (1989)
stated that celebrities tend to create greater effect on the consumers’ buying behavior.
McCracken further states that celebrity endorsement advertising is an omnipresent
feature of modern marketing.
According to Silver and Auster, Celebrities are people who enjoy public recognition
among a large group of people and possess distinctive qualities like attractiveness and
trustworthiness. They have some characteristic attributes like attractiveness,
extraordinary lifestyle or special skills that are not commonly observed. Many big
brands have recognized the importance of celebrity endorsements as marketing
communication tool. Thus, it can be said that within a society, celebrities generally
differ from the common people and enjoy a high degree of public awareness.
Among the classic forms of celebrities, actors (e.g., Amitabh Bachchan, Salman Khan,
Shahrukh Khan, Ranbir Kapoor Etc.), models (e.g., Deepika Padukone, Katrina Kaif,
etc.), sports-persons (e.g., Sachin Tendulkar, Mahendra Singh Dhoni, Virat Kohli, etc.)
are significant.

4
 Celebrity Endorsements is a billion dollar industry in today‘s era. Use of celebrities as
part of marketing communications strategy is a common practice for major firms in
supporting brand image. Firms have invested large sums of money to align their brands
and corporate images with celebrity endorsers’ qualities such as attractiveness,
likeability, and trustworthiness in order to gain competitive differential advantage for a
firm’s products or services. Furthermore, celebrities serve not only to create and
maintain attention, but also to achieve high recall rates for marketing communication
messages in today’s highly cluttered environments.
Studies have proved that celebrities endorsing a company or brand can greatly increase
consumers' awareness of an advertisement, capture their attention and make the
advertisement more memorable. Additionally, when a celebrity endorses your
company, it tells the consumer that the company is reputable, has good products or good
customer service and is a sound company to deal with. Marketers spend huge amount
of money on celebrity endorsement contracts annually, it shows that celebrities play an
important role in the advertising industry. Considering the prices companies are willing
to pay and the effect it has on consumers buying behaviour, celebrity endorsements
appears to be a very popular advertising tool in the modern day marketing.
Meanwhile, selecting celebrity endorsers have managerial significance. A ‘right’
celebrity endorsement strategy can be an effective competitive weapon in mature and
saturated markets in order to differentiate products from competitors, since there is a
heavy advertising clutter and almost no room for actual product differentiation in
markets. However, at times, celebrity qualities may be inappropriate, irrelevant, and
undesirable. For example, Atkin and Martin found that respondents perceived celebrity-
advertisement favorably compared with the usage of a no famous person. On the other
hand, Mehta pointed out that respondents did not perceive celebrity endorsement
favorably, while Fireworker and Friedman reported that using a celebrity influenced
respondents’ attitudes positively toward the endorsed products, but did not influence
their purchasing intentions.
Firms endorse celebrity for a variety of reasons:
 It might be the life experience of the celebrity that fits the advertising message
or the endorser's high appeal with the firm's consumer target group.
 Consumer’s positive value the use of celebrity endorsers in the advertisements.
 Firms invest significant money in putting together brands and organizations
with endorser qualities such as attractiveness, likeability, and trustworthiness.
These days the firms are investing huge sums on celebrity endorsements. i.e., out of total
marketing budget 26-30% on an average is incurred on celebrity endorsements. In a lot of
firms like Reebok India, Adidas India, Nike India & Puma India, which all companies are
subsidiary of their respective international entities are spending majority of their
marketing budget in India on brand endorsements. The more successful the brand in India
higher is their investment in brand endorsements
For Example: Reebok India when came to India in the year 1995 had all the brand
endorsees as international sports performers which were not too relevant with majority of
Indian consumers and only for the niche consumers. As slowly over a period of time

5
Reebok India wanted to capture higher market share in India they had to get higher
relevance with their Indian consumers by which they could connect well with them and
earn more revenues by expanding their presence all in tier - 1,2 cities.
When a brand wants to connect with their target consumers than they have to forward their
brand value through a correct endorsee only, which very well connects and target market
aspires to be like that brand, than only the consumers would go ahead to purchase the
brand.
As these foreign brands came to India for catering the niche market segment, over a period
of time they realized that the Indian market has huge potential and they want to expand in
this area. Then these multinationals started getting more of Indian sports performers
initially Reebok‘s brand ambassador was Nelly Farrago for basketball than over a period
of time when they realized that Indian consumers have no significance than they planned
to introduce Allen Iverson & You Ming the world famous basketball players. After a while
Reebok understood that India as a country is obsessed about cricket than Reebok got a
major sector to increase their business. They got best of cricketers like, Rahul Dravid,
M.S. Dhoni, Yuvraj Singh, Harbhajan Singh etc and they launched their special collection
of these cricketers like Rahul Dravid collection in which they launched RD 10 Shoes and
Rahul Dravid Jackets and other apparels. Reebok also took ―Chak De India girl Sagarika
Ghate who got fame by one movie is also the brand ambassador of Reebok which again
connects to Indian customers faster than other brand ambassador of Reebok like Scarlet
Johnson a famous US Actress.
The Revenues received by Reebok would increase as it is connecting more itself to foreign
brand ambassadors. Recently Reebok India has signed a contract John Abraham as its new
brand ambassador

Celebrity Reach
Celebrity branding or celebrity endorsement of a company's product is effective largely
because celebrities have the potential to reach a large number of prospective consumers.
Reach can be loosely defined as the number of people that have seen and/or heard the
brand's intended message at least once. If a brand or company decides to use celebrity
branding to market their product, it is highly probable that they are deciding to attempt to
reach the largest assortment of potential consumers possible, rather than reaching a small
number of consumers but more frequently – which is described as frequency.
An example of the usefulness of a celebrity's reach can be shown in statistics taken from
telegraph.co.uk regarding the world's most followed Instagram celebrities. The most
followed Instagram celebrity is Selena Gomez, with each post that she makes being
viewed by all or most of her 145 million followers. Cristiano Ronaldo is 2nd, with 144
million followers, and Ariana Grande is 3rd with 116 million followers. A direct brand
endorsement from one of these celebrities would be significant were they to post a picture
with the company's product encouraging their followers to go out and purchase it.

6
Brand Image
There is a high focus placed upon the importance of choosing a reliable, trustworthy celebrity
to endorse or sponsor a company's product, while still balancing the celebrity's attractiveness,
power, and similarity of the celebrity's public image with the company's overall current, or
intended brand image.

Brand image can be described as "the set of beliefs held about a particular brand". Research
carried out by Keller & Aaker in 1992 suggests that a brand with better positive brand image
and attitudes is more likely to achieve heightened development within their relevant market.
Therefore, choosing a celebrity who is going to beneficially contribute to the existing or
intended image and attitudes of the brand is vital to ensure the success of the celebrity
branding.

Brand Recognition
Brand recognition is a huge part of celebrity branding. Brand recognition is where the
general public is able to establish a brand from its attributes. It is most successful when a
brand is exposed without a company name and is then recognized by the customer through
the visual signifiers such as logos, slogans, and colors. An Example of this is Coke
whereby their signature color is red and consumers acknowledge that. Brand Recognition
is extremely effective in promotional campaigns. To measure brand recognition and the
effectiveness it has on promotional campaigns, companies will conduct experiments on
study groups for results. If brands are equal in quality similar products brand recognition
will always have an advantage of higher sales.
Need for Celebrity Endorsement:
 Increase the sales of the firm
 Establish a company or a brand
 Easily recall the product or the brand
 Attract more attention
 To coordinate across diverse sets of customers

7
Types of celebrity Endorsement:

 Testimonial: The celebrity acts as a spokesperson for the brand. It’s a recommendation
by a celebrity affirming the performance, quality of a branded product or service.
Example: Parineeti Chopra advertising for Pantene.

 Imported: The celebrity performs a role known to the audience. The celebrities
performs a role which the audience has prior knowledge about.
Example: A R Rahman advertising for Airtel.

8
 Invented: The celebrity plays a new, original role. The celebrity performs a role which
is new and originality is present.
Example: Aamir khan advertising for Tata sky

 Observer: The celebrity assumes the role of an observer commenting on the brand. The
celebrity comments on the brand through mere observation only.
Example: Salman khan advertising for Britannia Tiger

9
  Harnessed: The celebrity’s image is integrated with the ads storyline. The
advertisement story board and image is totally in sync with the celebrity image.
Example: Ranbir Kapoor image on Cadbury Oreo.

Basic strategy:
 To steal minimum fraction of time
 Consumers are exposed to thousands of voices and images
 To find a hook

Celebrity endorser criteria:

 Audience: The celebrity must be able to connect and reach the audience the brand is most
compatible with.
 Characteristics: Must fit the brands characteristics so that they associate the right values
with the brand.
 Image: Brands must look and see if the celebrity’s image is one the brand wants to be
associated with, making sure they look into the celebrity’s image and past in case it could
put the company into a bad light. If the celebrity has a negative image, the brand could be
perceived that way too.
 Attractiveness: A positive attitude is associated with attractive people. The more attractive
a celebrity is, the more effective the endorsement will be. They look at the physical
attributes the celebrity has such as body shape, facial features, and nationality.
 Cost: Some celebrities can cost more than others due to popularity. The amount the
celebrity costs to have endorsed a product or service can influence whether they are
selected or not.

10
 Credibility: The credibility of the celebrity will transfer onto the brand so they must ensure
the celebrity has a credible reputation. If a celebrity is already endorsing other brands or
has endorsed a lot of brands in the past, this can have a negative effect on the brand image
as consumers could believe that they are only doing it for the money and their credibility
could come into question on whether the product is actually as good as what they are
saying, creating the brands credibility to come into question also.

Reasons for celebrity endorsement:

a. It enhances the credibility of a business

Companies enjoy enhanced credibility by choosing and endorsing the right celebrities for
their products. Celebrities have their specialized niche which ranges from music and film,
fitness, fashion, sports, etc. Therefore, as a business, you ought to take advantage of this
and hire a celebrity whose specialization is in line with the product or service you seek to
endorse. For example, a fitness trainer or author will work well at endorsing a health and
fitness product or service.

So note that customers will take your business and product more seriously if the right
celebrity endorses your product.

b. It boasts a business’ brand awareness

Without a doubt, celebrities are good at networking, and they also enjoy easy access to a
broad network. These are persons that love to take pictures which are often spread across
magazines, blogs, social media, etc. This, therefore, means that using a well-known
celebrity will significantly boost your brand in your target market and beyond.

In this regard, choosing a celebrity to endorse your products could be great as this will give
your product the ultimate exposure across the market. For example, if you design and sell
a waist trainer and a celebrity is seen training with one of these, fitness enthusiast will want
to know more about the waist trainer and the brand. Before you know it, prospective
customers will be calling, tweeting and messaging asking to learn more about the product
and how they can get it. Ultimately, this relates to increased brand awareness as well
increased sales.

c. Great promotional tool

Last but not least, celebrity endorsements tend to add significant value to a company’s PR
as it quickly attracts the attention of paparazzi and the media in general. As a business, the
greatest tactic you can use to promote your product is by getting a celebrity to talk about it.
When a celebrity does this, your product will receive media hype and lots of attention from

11
the general public. Without all these, your company runs the risk of staying in the shadows
and losing out on hugely profitable sales.

d. Marketing implications of Celebrity Endorsement

A celebrity endorsement provides an alternative to creative ads. Where creative ads are
more prone towards logic or humour, celebrity endorsements mainly focus on the strengths
of the celebrity and more often, it mainly tends to make the celebrity speak directly to the
public “I use this brand, do you” and in essence the celebrity is speaking to his loyalists –
“I am using this brand and so should you”.

However, the marketer also has to take care about the reputation of the endorser and should
prefer to stay with a celebrity which has a stable image and not that the image of the
celebrity changes every few weeks. Michael jordan, Sachin Tendulkar and Michael
Schumacher are celebrities whose images are stable and are hard to change. Thus for
leading organizations, they are one of the most preferable endorsers.

e. People want to be like the celebrities.

The stars’ fame and success stories are inspirations to majority of their fans. Therefore, some
attempt to live their lifestyles or even attempt to alter their physical looks just to appear even
remotely close to the star. Is this a good idea? I personally don’t think so but people in this
universe are obsessed human beings. Generally, celebrities would post a product they’re
promoting on their social media pages and therefore if fans truly want to look like them,
they will buy whatever products they use.

f. They open up new demographic

Stars with great reputation are prone to reaching more followers than stars that have terrible
reputation. Some of their fans range from 12–64 years old, or even younger. These
celebrities have fans of all ages, which may benefit brands. Why, do you ask?

Take Puma for example: can you imagine advertising Puma when their target audience only
ranges from 18–30 years old? Think about it. By using celebrities’ fame, Puma is able to
reach children under 13 years old or even adults above 40 years too! It obviously depends
on the stars’ reputation. If the star does not keep it PG-13, then the possibility of opening up
new market is little to none.

12
 g. The belief of getting high quality product

Companies spend millions on celebrity endorsements. Big brands such as Nike, Puma, Coca
Cola, Pepsi, McDonald’s, Vitamin Water, and etc. are worth billions themselves.

Since by now we know that consumers are prone to buying a product when they see a
familiar face in the ads, most also assume that it must be a high quality product because they
see some credentials. Most fans would believe that if their favorite stars think the product is
favorable, then they would most likely buy the product! At times, the brands can speak for
itself if they are big name brands anyway.

h. People remember the ads after seeing it.

When you scroll through magazines or watching TV or YouTube and see a celebrity in some
of the ads, what kinds of emotions are going through your mind Surprised, amazed, happy,
or even sad . These advertisements certainly will leave some sort of emotions, therefore it
would make you remember the ads you saw throughout the whole day.

Advantages of celebrity endorsement:

 Celebrity endorsements can build brand equity. An example of this is Nike, prior to
Michael Jordan Nike mostly sponsored tennis and track athletes and decided to expand
their market, which increased sales to become a multibillion-dollar company.
 Celebrity endorsement is used as an advertising strategy, by using celebrity status and
image, to promote a brand’s recognition, recall, and differentiation.
 It helps customers to remember advertisements when seeing a celebrity that has already
got a brand of their own, it will bring customers to try or purchase the product.
 It also helps the brand to stand out over a brand that does not use celebrity branding.
 Increased attention to the product and the brand
 Polishing the image of the brand
 Introduction of the brand to new and wider market
 Repositioning of the brand
 Guarantee of successful advertising of the brand

13
 Disadvantages of celebrity endorsement:

 Change in celebrity image

 Over exposure of celebrities
 Over shadowing the brand
 Negative Publicity
 Over use of their fame
 Financial risks

Advantages for Celebrities:

 Positive image: If the celebrity becomes an endorser for a company with a positive image,
the celebrity can gain the same reputation of the brand they are associated with. This could
be if they join with a brand who is environmentally friendly, the celebrity can be seen to be
environmentally friendly also.
 Income: Brands will pay a huge amount for celebrities to endorse their product or service.
This means celebrities gain more income for just associating them with the brand.
 Fame: Celebrities can also gain a bigger following from the brands consumers. They think
that if the celebrity likes a brand they do, that they should like the celebrity too.
 Special Treatment: Celebrities get special tables at restaurants, best sit at theatres and VIP
treatment at clubs or events. They get free parking at hotels or they cars are guarded at
events.
 Opportunities: Regardless of what they do in the industry they get a lot opportunities, like
become an ambassador or spokesperson for brands (take people like Terry Pheto who was
a brand ambassador for L’Oreal Paris and Bonang Matheba becoming brand ambassador
for Revlon South Africa). Now many celebrities are becoming entrepreneurs after and
while they have stardom.
 Fan following: Fans are the people who adore their celebrity idols. They can have celebrity
crushes or even real life admiration for their idols. Fan mail and other forms of appreciation
that celebrities receive can be inspirational, motivational and very humbling. After all, who
wouldn’t like to have their own fans and followers? Celebrities and other famous people
are generally richer than the average joy. They have luxurious homes and cars, fancy gifts
and expensive clothes, some feel fortunate enough to share their wealth with the less
fortunate.

Disadvantages for celebrity:

 Lose credibility: If the brand does something deemed unacceptable by consumers, the
celebrity can also be seen in this light. This could cause followers of the celebrity to be
doubtful of them, not just the brand. Assumptions could be made that the celebrity agrees
with all actions of the brand and become less credible by association.

14
 Put off other endorsements: By celebrities endorsing one brand, they could put off other
brands offering them endorsement deals meaning they could miss out on more money or
getting a deal with a brand they like more. They could also be seen as disliking other
competitor brands or not able to associate themselves with other brands such as Nike and
Adidas, as they in the same market.
 People lose interest: If the celebrities are always seen in advertisements frequently, people
will lose interest in them and feel bored by seeing them.

Advantages for Brands:

 Instant brand awareness: People will begin seeing, and associating the celebrity with the
brand meaning the brand is more recognizable, building stronger brand awareness.
 Personality Transfer: Using celebrity branding, can create a personality transfer where
the brand inherits the personality of the celebrity. This can be an advantage if the celebrity
has a positive reputation as the brand gains the attributes of the celebrity.
 Define and refresh brand image: The celebrity's attributes help to create the brands
attributes, and can also refresh a brands image so that people know exactly what the brand
stands for. Some brands also use it to re brand as their image as before it might not have
had a strong brand image that saw it in a positive light.
 New consumers: When a celebrity endorses a brand, they often bring their followers along
too, creating new consumers for the brand as they can reach a new market. The celebrity
appeals to their consumers, which then can become the brands consumers, as they want to
try what their celebrity is endorsing.
 Influences consumer purchases: New consumers arise as they follow the celebrity. This
creates the outlook that if the celebrity thinks the product is great, then they should try it
too. They desire to be like the celebrity, which influences the sale.
 Brand Positioning: Using a celebrity can help position the brand or product in the mind
of the target market become a positive connection. This can increase the brand position
over other brands.
 Lasting Publicity: Even after the endorsement deal is over, consumers will still associate
the brand with the celebrity. Brands will gain that connection with the consumers without
needing the celebrity as a current endorser.

Disadvantages for Brand:

 Image change: Since the brand is being associated with a celebrity, everything they do
will be associated with the brand. A bad celebrity image change, changes the brands image
and can cause a drop in popularity, losing consumers and credibility of the brand. An
example of this was Maria Sharapova being dropped by three of her major sponsors such
as Nike, after failing a drug test at the 2016 Australian Open. Celebrities can make mistakes

15
 and the brand can choose to back their endorser or drop them to avoid their reputation being
tarnished too.
 Loss of popularity: If a celebrity loses followers by becoming less popular, which could
be done through negative actions the brand will also lose popularity with that market. The
loyalty of the consumers to the brand will only stay if they are loyal to the celebrity.
 Overexposure: Celebrities credibility can suffer if they are endorsing too many brands or
products, especially in similar fields. This makes consumers associate the celebrity with
lots of brands, rather than one distinct one making their association with the brand not as
strong and compelling.
 Overshadowing: By a celebrity endorsing the product, consumers can just be interested in
the celebrity rather than following the brand. This means that they don't actually create a
connection with the brand, as their attention is focused on the celebrity, overshadowing the
initial product or brand.

Risks for celebrity by endorsing in brands.

When a celebrity is promoting a brand there can be risks involved, where there is a
miscommunication between the consumer and the representation of the product. In some
cases, there is no connection between the product and the celebrity, which can become an
effective or a defective result due to the position and relevance of the product. When
Celebrity Branding does not work out for a firm, the celebrity can be seen as a scheme to
promote the person as a marketing instrument. Ideally, some consumers believe that
companies who use celebrity endorsers, as a marketing strategy to promote a product
should choose an endorser who utilizes and enjoys using the product. Therefore, ethically
they are trusting the brand and showing potential consumers the effects of the product and
making the advertisement more believable. Rather than a celebrity endorser who is
promoting the brand just because of their social status and there is no relevance between
the product and the celebrity.
Companies who use celebrity endorsers are at a risk financially, whether they are choosing
the right celebrity endorser to represent their brand and return the favor with an increase in
sales, or for the brand to become known on a wider scale. Firms are also taking risks in
hoping that their chosen celebrity endorser will portray their brand in the correct way,
because any small or big mistake can cost the company in a negative outcome, especially
due to the celebrity's social status it can affect a huge audience. This could be due to
miscommunication between the firm and the endorser advertising the product or service.
Celebrity endorsement usually impacts the feelings of the customers and the position they
have concerning the advertisement and the brands, thus enhancing the purchase intentions

16
and the sales. Therefore, if there is a communication error, it can defeat the sale as well as
portray the brand negatively. Financially, firms can invest up to millions of dollars when
choosing a celebrity to promote their brand; therefore they do not wish for an undesirable
impact

Risk for Companies:

Although for a business, hiring a celebrity to endorse their brand would seem to be an
effective and profitable way of expanding the growth of their brand – there is a severe risk
with choosing this type of marketing strategy which could lead to damaging impacts on the
business therefore choosing this strategy could be an beneficial or a huge disadvantage.
When observing the communication process, the three main factors when communicating
information are through the sender, channel and receiver but then considering the noise
surrounding it – noise being anything that can interfere with the intended message sent
from the source to the receiver. A company when choosing the celebrity to represent their
brand, they have to carefully examine the reputation and image of this person and whether
it coincides and complements with their product and purpose. A business needs to have
confidence in this celebrity to remain acting a suitable way which does not diminish the
reputation of the brand otherwise there could be a definite negative impact on the way a
consumer interprets a message from the brand.
For example, in recent news the global Tennis star Maria Sharapova who has been a role
model and highest paid female athlete for the past 11 years since she was 17 was caught in
a scandal after she failed a major drugs test. Sharipova, endorsing some of the biggest and
most successful organizations like Nike, Poshe and Evian – was immediately dropped by
these businesses as soon as word was out about the drug failure as it was evident that this
would be harmful to the companies' reputation and would leave consumers with a different
and undesired view of their brand. It is shown that even the most seemingly reliable and
trustworthy celebrities can slip up and cause brand image and reputation to be put on the
line.
The news of controversy surrounding a celebrity would be a definite source of noise and it
alters the message a brand is trying to convey. Consumers would already have specific
connotations and personal views on the celebrity after negative news about them has
surfaced, which would consequently directly affect that same consumer's image of the
company. This is known as the term 'Source-related Thoughts' where the source
significantly sways the thoughts of the receiver. It has been said that "If consumers find a
particular spokesman annoying or untrustworthy, they are less likely to accept what this
source has to say...Receivers who react favorably to the source generate favorable thoughts,
or source bolsters. This would mean that if a company chose to market their brand using a
celebrity they would have to make sure their target market would appeal to this person as
they develop feelings for the consumer regardless of the brand their product. Therefore,

17
there would no use in using a youthful teenaged movie star to endorse an anti-wrinkle
cream or a very misogynistic politician to promote a campaign to women – people would
not be in favor to trust or like the business because they dislike or do not relate with the
celebrity spokesman representing it. Choosing a celebrity in which a business' target market
will appeal to will convey and carry on the message effectively.
The entire aim of marketing and advertising is to draw attention to your business and
persuade or manipulate the target market into consuming goods or services. The more
attention brought to the company, the larger opportunities gained to communicate with
consumers. With using celebrity branding, there is an advantage as because this person
already has a large audience and following, attention can be drawn easily. It's how the
business uses this attention decides whether the outcome is beneficial or negative to the
brand because there are dear impacts if an error is made due to the many people watching
and making judgments. The theory of market senses/sensory marketing is where a marketer
relates to an audience on an emotional level. With taking advantage of the already built
attention, the right celebrity branding whether the brand is looking for a celebrity with sex
appeal or a reputation of charity or generosity, these can develop an emotional response
and connection from consumers which can benefit the business greatly. Though of course
if celebrities possess undesired traits, this can generate a negative emotional response
which would turn consumers away from a brand.
Some of them are:
 Loss of reputation of company.

The reputation of the celebrity may derogate after he/she has endorsed the product: Pepsi
Cola's suffered with three tarnished celebrities

 Mike Tyson
 Madonna
 Michael Jackson.

Since the behavior of the celebrities reflects on the brand, celebrity endorsers may at times
become liabilities to the brands they endorse.

 The vampire effect:

The terminology vampire effect pertains to the issue of a celebrity overshadowing the
brand. If there is no congruency between the celebrity and the brand, then the audience will
remember the celebrity and not the brand.
There are many examples where celebrities are being used almost indiscriminately for
sheer notice ability-everyone enjoys watching Shahrukh khan dancing, but does this

18
position the brand as the best dandruff shampoo? Or Ajay Jadeja endorsing toothpaste -
does this really build brands? Cricket stars are used often for energy drinks or sports goods
but their endorsing engine oil makes one.
 Inconsistency in the professional popularity of the celebrity:
The celebrity may lose his or her popularity due to some lapse in professional
performances.
For example, when Sachin Tendulkar endorser of Adidas went through a prolonged lean
patch recently, the inevitable question that cropped up in corporate circles - is he actually
worth?
The 2003 Cricket World Cup also threw up the Shane Warne incident, which caught Pepsi
off guard. With the Australian cricketer testing positive for consuming banned substances
and his subsequent withdrawal from the event, bang in the middle of the event, PepsiCo -
the presenting sponsor of the World Cup 2003 - found itself on an uneasy wicket

 Multi brand endorsements by the same celebrity would lead to overexposure:

The novelty of a celebrity endorsement gets diluted if the endorser does too many
advertisements.
This may be termed as commoditization of celebrities, who are willing to endorse anything
for big bucks.
Example, MRF was among the early sponsors of Tendulkar with its logo emblazoned on
his bat. But now Tendulkar endorses a myriad brands (Adidas, Boost, and Pepsi etc) and
the novelty of the Tendulkar-MRF campaign has scaled down.

Paid endorsement:
Paid endorsement or overt endorsement involves a contract between the brand and the celebrity for the
celebrity to represent the brand in an advertising campaign. The contract may involve some restraints
on the celebrity's act; such as cutting their hair or endorsing a direct competitor. Paid endorsements
involves a contract between the brand and the celebrity to represent the brand. The celebrity will
generally gain a sum of money for endorsing the brand but also have a few guidelines to follow. Some
methods of paid endorsements are:

 Advertisements

Advertisements can include television advertisements, radio, billboards, or magazine posters showing
the celebrity in the brands advertisement to help increase the products image. The celebrity could be

19
seen using the product, or the main character, as being seen in the advertisement can help viewers
associate them with the brand. An example of Celebrity Branding in an advertisement is George Clooney
in Nespressos 'What else' advertising campaign. Celebrities used for voice-overs or radio advertisements
generally have a distinct voice that viewers will recognize like Morgan Freeman's voice.

 PR Events

Brands use events for the celebrity to be seen at, as it helps show their support or association with the
brand. Having photos taken of the celebrities at the event makes the viewers associate them with them
supporting the brand, making the viewer associate a positive connection. This can be done through
celebrities hosting the brands event, like Victoria Secret Show, using celebrities to perform on the
catwalk.

 Social Media

Celebrities promote the brand using social media using social media, like Instagram, Facebook or
Snapchat. This helps the brand target the celebrities' followers to create an association between the two.

Social media sites, including Twitter, Instagram and Facebook, are a popular non-traditional medium for
celebrities endorsing products and brands. The advantages of using celebrity endorsements on social
media is the large reach that celebrities have. This means that large audiences are exposed to the influence
of the celebrity to encourage positive purchasing behaviors towards the brand. In 2013, the most followed
accounts on Twitter with more than 30million followers each were Justin Bieber, Lady Gaga and Katy
Perry

Unpaid endorsement

Unpaid endorsement or covert endorsement occurs when a celebrity wears or uses the
product of a certain brand because they like it. Brands can send free samples to celebrities
to try out their product, and review or use on social media to give their opinion on the
product. Lots of beauty companies use this to get YouTube reviewers to review their product
so they get free advertising. Sometimes a celebrity is given merchandise by a brand to use
or wear in public where there is maximum exposure, such as an event. This is called
"gifting"[35] and the celebrity might endorse the brand by taking a photo of the gift and
putting it on their social media account for their fans and followers to see. Whilst the
"gifting" may appear to be unpaid, costs are associated with this endorsement, as the brand
does not have any contract in place with the celebrity and will have little or no protection
against what happens during the unpaid endorsement. Celebrities are seen wearing or using
the product due to liking it themselves. They could be seen wearing the product in public or
in photos on social media. This is 'free advertising' for the brand. A disadvantage of this is
the brand has no control over what message or image the celebrity associated with the brand
is portraying.

20
21