The Impact of celebrity endorsements

Referring to the words of Daniel J Boorstin, “A sign of a celebrity is that his name is often worth more than his services.”. Advertisement plays a vital role in the economy; it is the foundation upon which this fast paced world learns what’s new and available. To sell a product in the competitive global market has become a challenging task. Homogenous products and brands make it difficult to choose from. Minor tweaks in design and voila a new product is ready for the shelves. However advertisement is major difference between the brands and their products and services. In order to survive in this trade, companies require sales to increase which would establish a label for the company seemingly creates a sense of belonging between the consumer and the product. This sense of belonging is awakened in the hearts of the purchasers by going along with celebrity endorsements where consumers can relate to their favorite celebrity that leads on to influencing demand for that brand’s product or service. When relating to celebrities, it is vital that companies choose celebrities who are up in the popular rating hence strengthening the scope of accomplishment in gaining market share for the particular brand, product or a service. It can be said that the popularity and the association of the celebrity with the brand has a direct relationship. As the popularity level goes up, so does the image of the brand in question. The basic idea of the endorsement is quite simple. General consensus is that people like celebrities, if those celebrities say that they like a product or a service naturally people will like what they like. It is as if by magic celebrities transfer their popularity from themselves to the products. Endorsement also might symbolize quality or any other related virtue. In order to sell a product we need to advertise and what could be better than to advertise on the shoulders of already successful sales i.e. celebrities.

Background of the problem – research interest (500)

The history of celebrity endorsement of products dates back to the 1760s. Josiah Wedgwood, the founder of the Wedgwood brand of pottery and chinaware, also called the father of the modern brand ‘; used royal endorsements and other marketing devices to create an aura around the name of his company that gave the brand a value far beyond the attributes of the product itself. The cigarette industry signed on entertainment personalities and used them in its ads in 1905.

Since radio became commercial in the late 20s and from the first flickering of TV screens in the late 40s, celebrities have done commercials. Western culture has always flocked to the notion of a ‘celebrity driven’ culture; whereby celebrities dictate the trends of the post-modern materialistic culture. Endorsements help the companies to gain strength in the market in order to be part of the consumers’ purchase basket. By doing so, sunrise companies prosper and develop into bug giants. Celebrities have a growing interest of the consumer population hence that image and aura is used in relation to a brand to influence the purchase decisions of people all around. This mechanism allows for change in tastes and interests with regard to the celebrity endorsement.

Aristotle once said, “Any brand can get a celebrity that is easy. But getting a celebrity consistent with the right brand to the right degree at the right time for the right purpose and in the right way; that is not easy.

Pakistan’s media network has gained new benchmarks as compared to yesteryears. Once being an agriculturally dominated, Pakistan has developed in this aspect. Cable and television being accessible to wherever there is electricity and road side billboards being the hub of advertisement. Be it radio, television, billboards or internet, advertisement market of Pakistan has expanded its outreach whereby it is now creating alliance with celebrities from overseas and setting aside endorsements as per the requirement of the current times. This opportunity of hiring non- Pakistani celebrities for brand image reaches new popularity levels that were previously held by Pakistani entertainers. Pakistan is increasingly following in the footsteps of the Western world by adopting a celebrity driven culture; where latest trends, fashions and ideas are modeled after various celebrities. History is witness to the fact that investments in celebrity endorsements in Pakistan have increased rapidly in the last decade or so hence increasing the quality of competition as well promoting innovation in marketing strategies as well as product development. These chains of events have allowed Pakistan to grow in the positive direction hence creating awareness and increasing knowledge of the general public by means of massive advertisement projects in relation to gaining total strength of the consumer population. Huge investments require similar increases in revenue. Brand image once embossed within the consumers then the companies get their safe haven until they reap the fruit of their own mistakes. Thus companies are increasingly using celebrities to endorse their brands by either publicly using their product or appearing in advertisements for said products. The aim is to increase sales of the product by getting consumers to change their purchase behavior and buying more of the product (either by consuming it in greater quantity or buying more of the product). However celebrity endorsement does not automatically guarantee greater success, nor is the effectiveness same for every brand of a particular celebrity. Thus it becomes important for organizations to understand how celebrity endorsement affects their brand. The purpose of this thesis is to study the impact that celebrity endorsement has on a brand as well as the factors that determine the effectiveness of the endorsement for the brand in order to maintain successful brand recognition.

The research itself would focus on the telecommunications sector and how celebrity endorsements affect consumer purchase behavior and brand equity in this particular sector. This has been chosen as the area of study as telecommunications sector one of the most vital of all the infrastructure services today. It is not only essential for the growth and development of every other sector of the economy but also for the integration of local economy with the rest of the world.

Significance/importance of study (250)

Aisam ul Haq, Reema, Wasim Akram, they have all something in common. They are well known because of their public appearances and achievements in sports,tv , movies etc. Moreover, they are involved in advertising products via endorsements. This usage of famous ambassadors or celebrities in the department of marketing intervention and communications is growing since the late 1970’s and has exalted to a percentage of nearly 25% at the end of the 1990’s. Some researches show a positive direct economic effect of these famous endorsements despite they are very expensive. The emergence of these advertisement contracts with the famous and the socially popular raises questions of its own. Such as what interest do they serve of the companies? Why are they chosen over normal people from their tedious everyday lives? It ought to be of greath worth to the companies to know what product/brand goes with which celebrity in light of the expected outcome. Celebrity endorsements amount to millions of dollars in investments and the investment has to be on the mark to produce fruitful results. However to ensure soundness of the investment, appropriate time and money is alloted to the marketing department to match the product with the celebrity keeping in view the popularity ranking of the celebrity in question with forecasted predictions of his/her future public stance. This research measures the “Impact of celebrity endorsements on consumer purchase behavior” to keep a check on the consumer’s behavior patterns in relation to the associated celebrity endorsement. However, Althoug, marketing strategies if well directed could improve the message getting across thus creating a suitable link between the brand and the celebrity. In light of this, the planning process of the message and the brand equity management should cater to the celebrity appropriately. Objectives to be analysed should be crisp and clear in order to observe the effectiveness of the decision for celebrity endorsement. Apart from the economic interests of celebrity endorsements (e.g. rise in total revenue/market share), it involves several psychological objectives. Such as an increased knowledge of the brand name, a more clear representation of brand/product characteristics by consumers, enriched attitude towards the ad, towards the brand and lastly, increased purchase intentions.