PROJECT REPORT ON CELEBRITY ENDORSEMENT UNDER SPECIAL STUDIES IN MARKETING

NAME: - SHALAKA NITIN CHAVAN ROLL NO.:- 07

Synopsis
Today 'Celebrity Endorsement' has attracted immense debate on whether it really contributes to the brand building process or whether it is just another lazy tool to make the brand more visible in the minds of the consumers. Although it has been observed that the presence of a well-known personality helps in solving the problem of over-communication that is becoming more prominent these days, there are few undesirable impacts of this practice on the brand. Firms invest huge amounts as advertising expenditure for hiring the right celebrity. However there lies uncertainty with respect to the returns that the company might be able to garner for the brand. The issue of matching the values of the celebrity with the brand values is also very important, i.e. getting the right celebrity to endorse the right brand. Consumers perceive the brand as having superior quality because it has been endorsed by a credible source. This makes endorsement as one of the indictors of quality for any brand. Corporate credibility along with endorser credibility plays a significant role in the attitude of the consumer towards the brand and the advertisement respectively. On the other hand, the over popularity of the celebrity sometimes overshadows the brand. If the celebrity is involved in multiple endorsements, it tends to create confusion among consumers and hence negatively affects the perception of the advertisement and the brand. Hence, to say clearly whether the practice of celebrity endorsement impacts positively or negatively to the brand still remains a debate.

INTRODUCTION
The crescendo of celebrities endorsing brands has been steadily increasing over the past 20 years or so. Marketers overtly acknowledge the power of celebrity in influencing buyer's purchase decision. They have firm believe that likeability or a favorable attitude towards a brand is created by the use of a celebrity. The crore of rupees spent per year on celebrity endorsement contracts show that celebrities like Amitabh Bachchan, Shahrukh khan and Sachin Tendulkar play an important role for the advertising industry. It is an established fact that celebrity endorsement can bestow unique features or special attributes upon a product that it may have lacked otherwise. In India from late 1970's and early 80's the new trend in advertising started. Brands started being endorsed by celebrities. Hindi film and TV stars as well as sportspersons were roped in to endorse prominent brands. Advertisements featuring stars like Late Jalal Agha (Pan Parag), Tabassum (Prestige cookers), Sunil Gavaskar for Dinesh Suiting, Ravi Shastri and Vivian Richards (Vimal), Persis Khambhata and Kapil Dev (Palmolive Shaving cream) became common. Though marketers should remember that celebrities are mere living beings like us and if they can highlight the benefits or advantages of a brand they can also have some uncanny negative impact. Theory and practice suggests that the use of stars and their unleashing power in advertising generate a lot of publicity and attention from the public but the underline questions are, do these stars really help a brand by increasing its sales? On the other hand, can they really have an Impact on the person's consumption pattern, thereby changing his brand preference? How an advertisement featuring a celebrity can influence consumers buying decision and can create an association between a brand and a common man.

Celebrity
Celebrities are people who enjoy public recognition and mostly they are the experts of their respective fields having wider influence in public life and societal domain. Attributes like attractiveness, extraordinary life style or special skills, larger than life image and demigod status can be associated with them. It is safe to deduce that within a corresponding social group celebrities generally differ from the social norm and enjoy high degree of public awareness. Celebrities appear in public in different ways. To start, they appear in public when fulfilling their professional commitments example: Mahendra Singh Dhoni, who played cricket in front of an audience in Twenty-Twenty World Cup. Furthermore, celebrities appear in public by attending special celebrity events, example: the movie award nights; special screening; world premiers of movies or for social causes. These celebrities have universal presence and appeal, they are present everywhere, in news, fashion shows and magazines, tabloids and above all advertisements.

Celebrity and a Brand

Star power in India can be gauged by the successful endorsements done by Shahrukh Khan (Pepsi, Hyundai Santro, Sunfeast, and Navratan etc.), Amitabh Bachchan, Sachin Tendulkar, Rahul Dravid, Hrithik Roshan and the others. The inevitable question is, if and how the lively interest of the public in the rich and famous can be efficiently and effectively used by companies to promote their brands and consequently to increase their sales revenues. This fact can be brought out by using certain examples i.e. Mr. Amitabh Bachchan promoting Cadbury chocolates after the fiasco of infestation when the image of Cadbury India went very low in the eyes of people. Soon the company found a perfect fit and a reliable celebrity to transmit the correct message and help regenerating the lost trust. The fit between the product and celebrity is evident as Mr. Bachchan and Cadbury chocolates both have tested troubled times and still they stand tall and the love and trust they both share with the people all across India. This is a live example of how a celebrity brought certain attributes to a product like chocolate. Actor Shahrukh khan has also endorsed diversified products. His endorsement basket is ranging from Hyundai Santro to Sunfeast biscuits on one hand and from Compaq computers to Videocon electronics on the other.

According to Advertising research companies both the actors are doing well and the ad spent on both by the companies is increasing at a phenomenal rate, so does their basket of endorsements. These actors bring reliability and trust in the brand and above all, they help in increasing the sales revenues.

Discussion
Does celebrity endorsement really work? Theoretically yes, because the qualities associated with the endorser are associated with the brand and the brand therefore remains at the top of the consumer's mind. However one needs to realize that the impact of an endorser cannot be sustainable in all product categories and in all the stages of brand life cycles. It really depends upon the type of product. If it is a 'functional brand', then the product itself is the hero. Here any celebrity association with the brand without corresponding performance of the product will not be sustainable. While incase of 'image brands', like the categories of soaps, soft drinks, cigarettes etc., where it is difficult to distinguish between the products, celebrity endorsements help to distinguish between the brands at an emotional level. A research conducted by Synovate7, a global market research firm, revealed that 47% people would be more likely to buy a brand that was endorsed by their favorite celebrity. Pepsi Co. has used a variety of celebrities including Aishwarya Rai, Hrithik Roshan, Amitabh Bachchan, Kareena Kapoor, Rahul Khanna, Fardeen Khan, Sachin Tendulkar etc. Amongst advertisements featuring celebrities, Pepsi tops the heap with the highest recall of 70%, while arch rival Coke is lower across all markets with 52% recall. This proves that Pepsi has really exploited the use of celebrities in their advertisements and has worked. Hindustan Lever's 'Lux' soap in India has been using popular film actresses to endorse the soap since its launch four decades ago implying that they owe their stunning looks to the brand. This consistent message hence reinforces the brand values and has been successfully able to position the soap rightly as the 'beauty soap. It would be difficult to judge the direct effect of celebrity endorsement on the sales or profits of the company. On Amitabh Bachchan endorsing RIN, an HLL spokesperson says that it was too early to gauge the success of 'Rin' in terms of sales and that though Dabur healthcare products' sales had improved, the increase could not be solely attributed to him. Similarly, there are also cases wherein there was a dramatic change in the sales figure after the endorsements. For example Rahul Malhotra, Associate Director Marketing, P&G India quotes "Certainly, it
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has helped us promote our brand 'Head & Shoulders'. Last year, we were ranked as No. 2 and this year we are market leaders in this segment with over 45% market share".

Source Credibility
Central goal of advertising is the convincing of consumers and persuasion to purchase, the ultimate objective, though not openly spoken, is to some how attract consumers to the market offering of the company, generating positive attitude, reinforce positive association and ultimately to generate sales, may be a trial purchase. At later stages, the sponsor may work towards creating a brand loyalty but generating initial sales or increasing the existing sales is the primary objective. In this respect, the credibility of an endorser along with advertisement plays an important role in convincing the target audience of the attractiveness of the company's brand and generates sales. Pursuing a celebrity endorsement strategy enables advertisers to project a credible image in terms of expertise, persuasiveness, trustworthiness, and objectiveness. To create effective messages, celebrity advertisers also have to consider the attractiveness of the spokesperson. Source attractiveness refers to the endorser's Physical appearance, Personality, Likeability and Similarity to the receiver, thus to the perceived social value of the source. This behavior mainly goes back to halo effect, whereby persons who perform well on one dimension example: physical attractiveness or top professional performance, social status are assumed to excel on other levels as well i.e. happiness and coolness. This is evident from the use of Fardeen Khan, modern, dynamic, outgoing and smart personality for Provogue; he translates the modernism of the brand well. Titan uses Aamir Khan in his different avatars for communicating to the public that their watches are as reliable and passionate as Aamir is for films. Both Fardeen and Aamir carry the message well and enhance the credibility of the brand they endorse.

Establishing a Perfect Match

Research proves that a spokesperson especially for a service product or organization (ICICI- First Amitabh Bachchan, now Shahrukh Khan) interacts with the type of brand being advertised. These stars communicate the value of the product and transform an ordinary service into a miracle solution for all problems of an ordinary customer. According to Friedman and Friedman (1979), a famous relative to a 'normal' spokesperson is more effective for products high in psychological or social risk, involving such elements as good taste, self-image, and opinion of others. Several research studies have examined the congruency between celebrity endorsers and brands to explain the effectiveness of using famous persons to promote brands. In India, a brand called Reid & Taylor presented its perfect example when they first launched their advertising campaign featuring James Bond fame of the time Mr. Pierce Brosnan along with the tagline 'BOND WITH THE BEST' but the James Bond idea did not worked and the company was not happy with the results. After the debacle of the first campaign, company introduced a family ad where children are celebrating there parents silver wedding anniversary and they are out with their father to purchase a suit for him. Even this commercial did not work and it was taken off the air. As a last resort, company introduced Mr. Amitabh Bachchan as Reid & Taylor man, a man propagating the brand for special occasion and for very special people in life. The commercial from the initial days got good response and did extremely well as people were able to connect with Mr. Bachchan and the values he was propagating. For the masses, there was a perfect match of an ideal Indian family man, a star and a good quality but bit highly priced brand reserved especially for special occasions and for very special people. Second example that can be quoted is of Vishwanathan Anand, who endorsed NIIT. NIIT adopted a very smart strategy by roping in Vishwanathan Anand an international chess wizard for their advertising campaign. As chess is considered to be a game full of strategies and a game for smart people and when one of the greats of the game is asking people to join NIIT it was suppose to have a positive influence on the people and actually it had. There was complete congruency and compatibility between the celebrity endorser, the product and the message. Contrary to only favorable outcomes, there are several examples where the product, even the entire campaign collapsed due to heavy weight celebrity as the agency or the ad failed to establish the relationship between the endorser and the
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product. Keeping the focus only on success, where the product and the celebrity were a perfect match, following are few examples:
Celebrity Endorser Amitabh Bachchan * * * * * * * * Company / Product Dabur Cadbury Reid and Taylor Parker Santro Videocon Sunfeast Pepsi

Shahrukh Khan Juhi Chawala Ustad Zakir Hussain Aamir Khan Aishwarya Rai Rani Mukherjee Kajol and Ajay Devgan

* Kurkure * Taj mahal tea * Titan * Coke * Toyota Innova * Nakshatra * Lux * Fanta * Nestle Munch * Whirlpool * Tata Indicom

The campaigns are not only basking with the glory of success stories, but there is considerable number of failures as well. Assuming that a person just have to be famous to represent a successful brand, however, would be incorrect and may turn out to be a very dangerous preposition resulting into a big calamity for the entire advertising campaign or the brand. Very well accepted and attractive super stars like Abhishek Bachchan and Amitabh Bachchan failed in turning their endorsements into success i.e. Maruti Versa similarly Virendra Sehwag also failed to deliver Reliance Telecommunication with the master stroke of his cricketing genius. Among the possible reasons identified by several authors, including overexposure and identification, the 'match-up hypothesis' specifically suggests that the effectiveness depends on the existence of a 'fit' between the celebrity spokesperson and endorsed brand. Empirical work on the congruency of brand with the celebrity often has concentrated on the physical attractiveness of the endorser. Results show that an attractive spokespersons are more effective in terms of attitude change when prompting brands that enhance one's attractiveness i.e. cosmetics; health drinks or fashion wear. Primary data states, for celebrity spokespersons to be truly effective, they should be knowledgeable, experienced, mature, and a bench mark in their respective field and qualified to talk about the product.

Positive Impacts of Celebrity Endorsement on the Brand

Approval of a brand by a star fosters a sense of trust for that brand among the target audience. This is especially true in case of new product11. Celebrities ensure attention of the target group by breaking the clutter of advertisements and making the advertisement and the brand more noticeable. A celebrity's preference for a brand gives out a persuasive message and hence, because the celebrity is benefiting from the brand, the consumer will also benefit. There is a demographic and psychographic connection between the stars and their fans. Demographic connection establishes that different stars appeal differently to various demographic segments i.e. age, gender, class, geography etc., while psychographic connection establishes that stars are loved and adored by their fans. Some stars have a universal appeal and therefore prove to be a good bet to generate interest among the masses. Another invaluable benefit from celebrity endorsements is the public relation opportunities. Looking at the effect of celebrity endorsement on the wealth of a company a classic example of Michael Jordan can be used. At the time of rumors of Michael Jordan returning to NBA in 1995, he was endorsing products of General Mills (Wheaties), Mc'Donalds (Quarter Pounders, Value Meals), Nike (Air Jordan), Quaker Oats (Gatorade) and Sara Lee (Hans Underwear). Study conducted by Mathur et al. associated with Jordan's endorsements shows that the anticipation of Jordan's return to NBA, and the related increased visibility for him resulted in increase in the market adjusted values of his client firms of almost 2 percent, or more than $1 bn in stock market value. From this study one can observe that the major celebrity endorser with rumors or otherwise has a tremendous potential to influence the profitability of endorsed products. Semi-partial endorsement indicates that when a company uses famous characters from any TV soaps for brand endorsements, consumers tend to relate to the character that he or she plays in the soap and hence can attract more credibility. For example, Smriti Irani who plays 'Tulsi' in a famous soap has garnered a lot of support from the middle-class housewife today. If she would endorse a brand, there would be more relativity and credibility. Same can be said about Priya Tendulkar who used to play the character of Rajani.

Negative impacts of Celebrity Endorsement on the brand

More often talked about is the extreme usage of a celebrity called 'lazy advertising', that is inadequate content masked by usage of a celebrity. A good example is the use of Boris Becker by Siyaram and Steve Waugh by ANP Sanmar. Also as said earlier, associating with a star, in itself does not guarantee sales. There is also the fear of Brand-celebrity disconnect which points out that if the celebrity used represents values that conflict with the brand values, the advertising would create conflict in the minds of the target audience. Clutter in brand endorsements is very prominent these days and such kind of overexposure can be bad for the brand as the recall value drops by a huge margin. A popular drawback of celebrity endorsement is the 'Vampire Effect' or the celebrity overshadowing the brand. Some viewers forget the brand that a celebrity is approving. Others are so spellbound by the personality of the celebrity that they completely fail to notice the brand being advertised. Two new drawbacks can be seen these days what marketers call Celebrity Trap and Celebrity Credibility17. Celebrity trap is when the celebrity becomes an addiction for the marketing team and the task to find substitutes becomes more and more difficult, leading to surfeit of celebrities. Celebrity credibility refers to skepticism by the consumers regarding the celebrities, especially when there is anything negative regarding the celebrity associated with the brand in the news, then brand is bound to be affected. For example, Air Jordan's generated revenue sales of $130 million in the first year. The sales dropped miserably in the second year when Jordan missed 62 games due to a broken foot18. Another main worry of the advertisers is that their celebrity endorser would get caught in a scandal or an embarrassing situation. Multiple product endorsement also has a negative impact on customers' purchasing intentions. Tripp et al. investigated the effects of multiple product endorsement by celebrities on customers' attitudes and intentions. They found that the number of products a celebrity endorses negatively influences consumer perception of the endorser and the advertising itself. It was suggested that when as many as four products are endorsed, celebrity credibility and likeability, as well as attitude towards the ad, may attenuate. Superstar Amitabh Bachchan endorses multiple brands like Pepsi, Mirinda, ICICI, BPL, Parker pens, Nerolac, Dabur, Reid & Taylor, Maruti Versa, Hajmola, Tide, Cadbury and a few social messages. It has worked in some cases, while in some cases it has not. D. K. Jain, Chairman and President, Luxor Writing Instruments Pvt. Ltd, the marketer of the Parker brand said, "Using Amitabh Bachchan as our brand ambassador has helped in strengthening our brand image and recall within the target audience". Tarun Joshi, Communications Custodian, Reid & Taylor said, "Amitabh Bachchan is an icon with universal appeal and has helped us to reach
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out to the real 'Bharat.' In fact, agents and retailers have told us that already customers have started asking about the 'Amitabh wali suiting.'" Incase of Nerolac Paints, which was endorsed by Amitabh Bachchan, around 80% of the respondents when asked to associate Bachchan with any paint, did so with Asian Paints, which is the biggest competitor of Nerolac. The budget or cost is an important factor for celebrity endorsement. Depending on the status of the celebrity, remuneration could run into millions of rupees for several years or may also include a profit sharing plan. For example when S. Kumar's used Hrithik Roshan for their launch advertising for Tamarind, they reckoned they spent 40 - 50 per cent less on media due to the sheer impact of using Hrithik. Sachin's endorsements got him $18 million over five years. When Aamir first endorsed Pepsi in 1995, he received Rs 17 lakh for it; his Coke commercials in 1999 got him Rs 2 crore. Hrithik Roshan in his highflying days reportedly made over Rs. 20 crore in endorsements and events by 2001. However, a number of brands have been built without celebrity endorsement. For some of their brands, Hindustan Lever and Procter & Gamble do not believe in celebrity endorsement because they think that consumers, especially housewives, are more likely to identify with a lay person on screen than a celebrity. Procter & Gamble launched its 'Rejoice' brand in India with testimonials from ordinary women in their TV advertising. Few more examples of this will be Lifebuoy, Wheel, Dettol, Close Up, Fevicol etc.

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Conclusion
Whether Celebrity endorsement has a positive or a negative impact on the brand is a debate that is open to interpretation. But till the time the corporate world continues to foot fancy bills of celebrity endorsers and till consumers continue to be in awe of the stars, the party is not likely to break up. A brief assessment of the current market situation indicates, that celebrity endorsement advertising strategy can under the right circumstances indeed justify the high costs associated with this form of advertising. The use of celebrity for endorsements creates a very favorable impact on the consumer and it creates a connection which forces a consumer to purchase a product. However, as several failures show, it is essential for advertisers to be aware of the complex processes underlying celebrity endorsement. It has been proved from the discussion that celebrity endorsements are a powerful and useful tool that magnifies the effect of a campaign but the word of caution to be followed seriously; celebrities alone do not guarantee success nor does a great advertising campaign or the best possible product. It is the combination of several factors and elements that work together for the success of a brand and its acceptance in the minds of consumers as well as for its market offering.

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WEBLIOGRAPHY

www.google.com www.wikipedia.com

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