Impact of Celebrity Endorsements on Overall Brand

This paper studies the impact of celebrity endorsements on brands. While the magnitude of the
impact of celebrity endorsement remains under the purview of gray spectacles, the paper
establishes reasoning to the impact of celebrity endorsements on brands.

The study delves into the learning of impact regions of celebrity endorsement and how they
occur.

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. Is
there a science behind the choice of these endorsers or is it just by the popularity measurement?
What are the reasons which lead to impact of celebrity endorsement on brands?

Through research and analysis, this paper emerges with a 14-point model which can be used as
a blue-print criteria and can be used by brand managers for selecting celebrities, and capitalizes
the celebrity resource through 360 degree brand communication since our research proposes it
as the foundation brick of the impact of celebrity endorsement. Our study reveals that the impact
of celebrity endorsement is proportional to the 14 factors discussed in the model.

The success of a brand through celebrity endorsement is a cumulative of the following 14

attributes. Greater the score of the below parameters greater are the chances of getting close to
the desired impact.

The paper also discusses the scope of celebrity endorsement and ends with few insights on
celebrity endorsement and its impact on brands.

Introduction

Businesses have long sought to distract and attract the attention of potential customers that live
in a world of ever-increasing commercial bombardment. 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 person's time
to inform him or her of the amazing and different attributes of the product at hand. Because of the
constant media saturation that most people experience daily, they eventually become numb to the
standard marketing techniques. The challenge of the marketer is to find a hook that will hold the
subject's attention.

Also from a marketing communications (marcoms) perspective, it is vital that firms design
strategies that help to underpin competitive differential advantage for the firm's product or
services. Accordingly, marcom activities back-up other elements in the marketing mix such as
designing, branding, packaging, pricing, and place 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, Rani Mukherjee
Aamir Khan and Pierce Brosnan), models (e.g., Mallaika Arora, Lisa Ray, Aishwarya Rai, Naomi
Campbell, Gisele Buendchen, etc), sports figures (e.g., Sachin Tendulkar, Zaheer Khan, Sourav
Ganguly, Anna Kournikova, Michael Schumacher, Steve Waugh, etc), entertainers (e.g., Cyrus
Broacha, Oprah Winfrey, Conan O'Brien), and pop-stars (e.g., Madonna, David Bowie) - but also
for less obvious groups like businessmen (e.g., Donald Trump, 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 appear 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 'private 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.

'Celebrity Endorsement'

McCracken's (1989) definition of a celebrity endorser is, "any individual who enjoys public
recognition and who uses this recognition on behalf of a consumer good by appearing with it in an
advertisement (marcoms), is useful, because when celebrities are depicted in marcoms, they
bring their own culturally related meanings, thereto, irrespective of the required promotional role."

Friedman and Friedman (1979) found empirical evidence that, in the promotion of products high
in psychological and/or social risk, use of celebrity endorser would lead to greater believability, a
more favorable evaluation of the product and advertisement, and a significantly more positive
purchase intention.

Thus, companies use celebrities to endorse their products, however, there are deeper attributes
that are involved in 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 brand's benefits. He/she is an integral part of the brand
persona and helps to build an emotionale, 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 between making just an endorsement for
say, a shampoo or an automobile, and being that brand's 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 with the campaign's end.

Spread of Celebrity Endorsement

Markets in which advertising coordinates consumer purchases, celebrity endorsements are more
likely chosen for products that have either of the following: -

High price-cost margins

Large potential customer pools

The need to coordinate across diverse sets of customers

Scope of Celebriity Endorsement

The use of testimonials by advertisers dates back to the 19th century when medicines were
patented. Firms have been juxtaposing their brands and themselves with celebrity endorsers
(e.g., athletes, actors) in the hope that celebrities may boost effectiveness of their marketing

Scope of Celebriity Endorsement

The use of testimonials by advertisers dates back to the 19th century when medicines were
patented. Firms have been juxtaposing their brands and themselves with celebrity endorsers
(e.g., athletes, actors) in the hope that celebrities may boost effectiveness of their marketing

The increasing number of endorsements throws a valid question to the consumers. Is there a
science behind the choice of these endorsers or is it just by the popularity measurement? What
are the reasons which lead to impact of celebrity endorsement on brands?

Through research and analysis, this paper develops a 14 point model, which can be used as a
blueprint criteria which can be used by brand managers for selecting celebrities, and capitalizes
the celebrity resource through 360 degree brand communication, since our research proposes it
as the foundation brick of the impact of celebrity endorsement. Our study reveals that the impact
of celebrity endorsement is proportional to the 14 factors discussed in the model.

The success of a brand through celebrity endorsement is a cumulative of the following 14

attributes. Greater the score of the below parameters, greater are the chances of getting close to
the desired impact.
Fit with the Advertising Idea

Marketers now seek to adopt 360 degree brand stewardship in which the brand sees no limits on
the number of contact points possible with a target consumer. Advertising ideas, thus, revolve
around this approach, and the celebrity endorsement decisions are made through these startegic
motives.

One of the most successful celebrity endorsement campaign which reflects the fit between the
brand and the 360 degree advertising fit is Fardeen Khan and Provogue. Provogue's positioning
in the apparel market is of a young, active, party-going, attention-grabbing brand and so is
Fardeen Khan. The conjuction between the two has been immensely impactful and brand
managers have utilised this endorsement through 360 degree reinforcement. Provogue Lounge
and extensive phased insertions in print in selective publications reaching out to their target
audience has made it as one of the highest recalled celebrity endorsement.

Similarly, Richard Gere's recent endorsement for VISA in India has gained acclaim due to its
innovativeness and consumer connect. Brand marketers say that research reveals that Richard
Gere was the most popular face across the Asia Pacific region, and would also fit into the
persona of the brand meeting their communication objective to enhance VISA's brand leadership
and consumer preference, and the motive to continue the "All it Takes" empowerment platform
featuring international celebrities.
Celebrity-Target Audience Match

Smriti Irani endorsing the WHO recommnded ORS Campaign in India. Indian mothers can
associate with Smriti Irani through the facets she projects on screen or in regular life which helps
develop a connect with the target audience since mothers medicate their children with ORS. The
inserial placement of the campaign in "Kyunki Saas Bhi Kabhi Bahu Thi" has won it an award
from PR Week.

Similarly, Irfan Pathan endorsing Hero Cycles has gained the brand immense recall and
embarked through the positve association between the consumer and the brand.

Celebrity Values

Celebrity branding is all about the transfer of the value from the person to the product he
endorses or stands for. There are two concerns here. The first is how long this could last. Can the
person maintain his popularity (i.e., his performance or status ranking)?

The lifecycle of celebrity popularity varies a lot. The second concern is his private life - personal
integrity. If he is implicated in any kind of scandal, that would ruin the brand. "Who would want to
use Michael Jackson to brand their product?" (brandchannel.com)

Tabu endorsing Tetra Packed Milk, Shabana Azmi campaigning for AIDS Awareness, Amitabh
Bachchan & Shahrukh Khan campaigning for Pulse Polio or Aishwarya Rai appearing in the
Donate Eyes campaign are few examples, which reflect the transfer of celebrity values to the
brand, creating an impact that generates recall.

Costs of Acquiring the Celebrity

Consequently, companies must have deep pockets to be able to afford the best available
celebrities. Recently, a newspaper report showed how cola firms had gone beyond their
advertising budgets to get the best celebrities. Small firms that use celebrities' services run
greater risks if they invest large amounts. Although nobody is willing to say exactly how much
celebrities get paid, industry sources say Sachin Tendulkar's price is believed to be between Rs.
2.0-2.5 crore per endorsement, and musician A. R. Rehman, who had signed up with AirTel, is
believed to have picked up Rs. 1.75 crore. Film-star Hrithik Roshan was rumored to have picked
up Rs. 2 crore for the Fly With Hrithik campaign to push Close-Up, and Shahrukh Khan's rate
seems to be between Rs. 2.5-3.0 crore. Aishwarya Rai apparently picks up Rs. 1.25 crore for an
endorsement and the Indian cricket captain Saurav Ganguly is believed to get between Rs. 90
lakh to Rs. 1.5 crore, while film-star Aamir Khan apparently makes Rs. 1.5 crore per
endorsement.

Celebrity Regional Appeal Factors

R. Madhavan endorsing Pepsi in southern India or Sachin Tendulkar endorsing in India are few
examples of how celebrities are chosen to reach out to target audiences for brands in regional
markets.

Another interesting example would be of Steve Waugh campaigning for Tourism Australia in India
since he was one of the popular celebrities from Australia and could carry the messge of Australia
as a tourist destination. Other celebrities like Kylie Minogue, Nicole Kidman from Australia can be
prospective endorsers for Brand Australia but not in the region of India.

Celebrity-Product Match
Cyrus Broacha is the brand ambassador for MTV since both the celebrity and the brand are
considered as friendly, young, mood-boosting, humourous and outspoken. MTV's brand
personality overlaps Cyrus Broacha's image as a brand.

Some more examples of compatible celebrity product match in which celebrity brand attributes
get transferred to the brand and increases the brand equity is of Mallaika Arora & Freshizza from
Pizza Hut, Govinda & Navratan Tel, Sanjay Dutt & Elf Oil, Sunny Deol & Lux Undergarments,
Aishwarya Rai & Nakshatra, etc.

Celebrity Controversy Risk

The perfect example here is of Salman Khan and the controversy in which he crushed a man to
death with his Pajero when he was driving under the influence of alcohol. Also, any act on the
part of the endorser that gives him a negative image among the audience and goes on to affect
the brands endorsed. The brand, in most instances, takes a bashing.

Celebrity Popularity

Celebrity Brand association like Garnier endorsed Tara Sharma & Simone Singh, Agni Diamonds
& Riama Sen don't get much brand recall, and even if they do, its difficult to attribute it to the
celebrities' endorsing the brand.

On the other hand, HPCL has had increased popularity and share of voice due to the
endorsement of the brand through Sania Mirza.

Celebrity Physical Attractiveness

Bipasha Basu' physical attractiveness and her connect with the brand makes Levis Strauss's
campaign through celebrity in India, John Abraham endorsing Wrangler and Timex Sunglasses
are some examples which portray the celebrities' physical attractiveness that helps create an
impact.

Celebrity Credibility

The most important aspect and reason for celebrity endorsement is credibility. In a research
carried out among 43 ad agencies and companies, most experts believed that the most important
dimensions of credibility are trustworthiness and prowess or expertise with regard to the
recommended product or service (Miciak and Shanklin, 2002). One of the most obvious reasons
of Amitabh Bachchan endorsing plethora of brands is the credibility of the celebrity and his
recognition across consumers.

To site one of the most successful campaigns in which the celebrity's credibility has had an
indelible impact on the brand and has saved the brand is of Cadbury's. After the worm
controversy, Amitabh Bachchan's credibility infused into the brand through the campaign, helping
it to get back on track. The campaign has won an award for the same.

Multiple Endorsements

The case of multiple endorsements, both in terms of a single brand hiring multiple celebrities and
that of a single celebrity endorsing multiple brands, is often debated. At times, consumers do get
confused about the brand endorsed when a single celebrity endorses numerous brands. The
recall then gets reduced and reduces the popularity of the brand. Not many people can remember
all the brands that a celebrity endorses and the chances of losing brand recall increases if the
celebrity endorses multiple brands. For example, in case of Sachin Tendulkar people recall Pepsi,
TVS Victor and MRF, but might not remember brands like Britannia and Fiat. Similarly, for
Amitabh Bachchan, consumers remember ICICI, Pepsi, Parker Pens, Pulse Polio and BPL. They
might get confused in the endorsement of Nerolac or Asian Paints. Thus, for multiple
endorsements where the same celebrity endorses several brands, it boils down to the strength of
the brand and the advertising content.

Whether Celebrity is a Brand User

One of the strongest platforms to discuss this is through NGOs. Various celebrities endorse
NGOs and social causes since they believe in the social message that they need to convey to the
audience. One of the most successful campaigns has been executed by PETA in which
celebrities like Shilpa Shetty, Amisha Patel, Yana Gupta, Sheetal Malhar, Mahima Choudhary

to believe in PETA's philosophy, and thereby endorse the brand.

On the other hand, while some would understand that Amitabh Bachchan would have never used
Navratan Tel, the target audience that the brands wants to reach out to will be ready to believe
that he used the oil and his endorsement thereby creates an impact.

Impact Regions of Celebrity Endorsement

While brand marketers with positive experiences would tend to believe that celebrity
endorsements work and some would disagree, but one would be sure that the magnitude of its
impact is difficult to measure even if sales figures are at our disposal. However, we can
understand why it works and the impact regions of celebrity endorsement.

The illustrations below explain the same: -

How Celebrity Endorsements Influence the Consumer

The basis for the effectiveness of celebrity-endorsed advertising can be linked to Kelman's
processes of social influence as discussed by Friedman and Friedman. According to Kelman,
there are three processes of social influence, which result in an individual adopting the attitude
advocated by the communicator:

Compliance, Identification & Internalization

These latter two processes are particularly applicable to celebrity-endorsed advertising.

Compliance infers that another individual or group of individuals influences an individual cause
he or she hopes to achieve a favourable reaction from this other group. This process of social
influence is not directly applicable to celebrity advertising because there is little, if any, interaction
between the celebrity and the consumer.

Identification applies to the situation wherein the individuals emulate the attitudes or behaviour
of another person or group, simply because they aspire to be like that person or group. This
process is the basis for referent power. It was found that celebrities are more commonly liked
than a typical consumer spokesperson.

Internalization as a process of social influence is said to occur when individuals adopt the
attitude or behaviour of another person because that behaviour is viewed as honest and sincere
and is congruent with their value system. The effectiveness of celebrity advertising traditionally
has not been strongly linked to this process, as a celebrity's reason for promoting a product can
just as easily be attributed by the consumer to an external motive (i.e., payment of fee) as to an
internal motive (i.e., the celebrity's true belief in the value and benefit of the product). An
important issue of concern relates to the development of a strategy for use in Celebrity
Advertising, which benefits from the dramatic impact of dual support of both the identification and
internalization processes of social influence. Celebrities are well-liked, but the techniques that can
be used to enhance their credibility as spokespeople, and therefore, tie-in more closely with the
internalization process needs to be looked into.

Effectiveness of Celebrity Endorsers

A study conducted by Charles Atkin and Martin Block focussed on alcohol advertising and young
audience to examine the impact of celebrity advertising in terms of social effects of advertising.
The sponsoring Company is the underlying source of any advertising

message, but the individual models depicted in the advertising serve as the more visible
communicator in many cases. The most thoroughly studied source quality is credibility. Research
conducted by social psychologists over the past 30 years demonstrates that a source perceived
as highly credible is more persuasive than a low credibility sender (Hovland and Weiss, 1951;
McGuire, 1969; Hass, 1981).

The sources that companies use to present their advertising message typically attempts to project
a credible image in terms of competence, trustworthiness or dynamism. Celebrity endorsers are
considered to be highly dynamic, with attractive and engaging personal qualities. Audience may
also trust the advice given by some famous person, and in certain cases, celebrities may even be
perceived as competent to discuss the product. Friedman, Termini and Washington cite a 1975
study showing that celebrities are featured in 155 of prime-time TV commercials. A later survey
reported that this proportion was up to 20% (Advertising Age, 1978). The most widely used
celebrities are sports figures, actors or other types of entertainers. There are several reasons why
a famous endorser may be influential: -

They attract attention to the advertisement in the cluttered stream of messages

They are perceived as being more entertaining

They are seen as trustworthy because of apparent lack of self-interest.

 The final element is due to the wide-spread attribution that major stars do not really work for
the endorsement fee, but are motivated by genuine affection for the product (Kamen et al, 1975).

Despite the use of famous endorsers, there is little published evidence regarding effectiveness. In
one experiment, an advertisement for a fictitious brand of Sangria wine featured an endorsement
attributed to either a celebrity (actor - Al Pacino), a professional expert, the Company President, a
typical consumer and no source (Friedman, Termini and Washington, 1977). College students
read the ad and gave the ad 0-10 scales of believability, probable taste, and intent to purchase.
Across these three measures, the celebrity condition produced the highest scores.

While the 'no-source' control group had a purchase intention rating of 2.7, the subjects exposed to the actor
scored 3.9. Believability was rated 2.8 by control subjects versus 4.1 by those seeing the celebrity
endorsement. For taste, the baselines of 4.0 compares to the celebrity group score of 5.6. None of the other
three endorsers were as influential as the celebrated person

Brand Image Formation & Brand Preference

Having a congruent image between the brand and celebrity does not guarantee any positive
effect on consumers' brand preferences. The fundamental question is - what a brand image really
does to consumers? Baran and Blasko explained, "Since most products aren't special, most
advertising does all that so-called image stuff... There's no information about the product, there's
only information about the kind of people who might be inclined to use the product." (p.13). This
view is echoed by Feldwick (1991) who has suggested that the subjective experience of using a
brand can be different from the subjective experience of using an identical product without the
brand reassurance. In the case of using celebrity advertising to build brand image, the effects are
examined with a social psychological framework.

Decision Making Process & Purchase Decision

Decades ago, John Dewey (1910) conceptualised decision-process behavior as problem solving -
thoughtful, reasoned action focused on need satisfaction. As Ajzen and Fishbein (1980, p.5) put
it, "Human beings are usually quite rational and make systematic use of the information available
to them... People consider the implications of their actions before they decide to engage or not to
engage in a given behavior." A lot of marketing research has shown that consumer decision
follows the sequence of need recognition, search for information, alternative evaluation,
purchase, and then outcome. The sequence can have major variations, however, from one
situation to the next in terms of the extent to which each of these steps is followed.

There are two types of decision-making processes defined. They include Extended Problem
Solving and Limited Problem Solving (Engel, Warshaw, Kinnear, 1991). In extended problem
solving, thinking leads to feeling, which leads to action. The very nature of the decision often
necessitates collection of information that is processed and stored. Various product attributes are
weighed and evaluated.

In limited problem solving, consumers will simplify the process by sharply reducing the number
and variety of information sources and alternatives considered. The two problem solving
processes above suggest that brand images have a relatively insignificant impact on the
consumer's purchase decision if the product/service involves extended problem solving. On the
contrary, the brand images of product/service that involves limited problem solving will have a
more significant impact on the consumer's purchase decision.

smoked glass, and book entire restaurants for an undisturbed meal. For most of us, life rarely
holds such pleasures. But as our power to distribute images expands, the ranks of the highly
visible in society are growing rapidly, and those who understand the transformation process utilize
it to enhance their opportunities.

Conclusion

Through analysis and research, this paper brings forth the following insights: -

Celebrity endorsements do work in the Indian scenario. The level and the magnitude of the
effect vary with the celebrity and the product category but most endorsements have a favourable
impact.

The consumer looks for a variety of aspects from the endorsement like the credibility and
likeability of the endorser. Credibility also means the fit between the brand and the celebrity.

Multiple endorsements do clutter the minds of the consumer.

When one endorser endorses many brands, then the recall of the endorsement depends
entirely on the power of the brand. There are definitely some brands that go unnoticed and the
recall for those stands is at a bare minimum. The company in that case can heighten the
advertising content because that etches a special place in the mind space of the consumer.

It is not just the financial gains from the endorsements that matter to the celebrity. They also
look for the fit with the brand and what the endorsement might do to their image.

Professional performance of the endorser is important in deciding the success of the

endorsement. However, the bad performance should be stretched so as to make sense to the
audience.

More than the bad performance in the professional field, it is the association of the celebrity
with a controversy or ill-behaviour that causes negative impact to the endorsements. During the
match fixing scandal in India, the commercials featuring Ajay Jadeja and Mohammed Azharuddin
were all taken off air so that they did not have a negative effect on the brand.

The celebrities' accessibility, regional appeal factors, popularity, attractiveness, belief system
are some other important platforms, which are raised when we study the impact of celebrity
endorsement on brands.