ABSTRACT
PURPOSE/OBJECTIVES/HYPOTHESES
This research was aimed at examining the effect of celebrity endorsement on consumers buying behavior. The research was conducted with reference to Indian FMCG industry. The research has attempted to achieve following objectives: to examine consumers’ frequency of purchasing celebrity endorsed products; to examine consumers appeal and choice of celebrity and effect on purchasing decision; and to examine consumers perception of risk in purchasing celebrity endorsed products .The central focus of the research was to test the following hypotheses: H1. There is positive effect of celebrity endorsement on consumer buying behavior. H2. Celebrity endorsement is better than non-celebrity endorsement with regard to effecting consumer buying behavior.
RESEARCH METHODOLOGY/DESIGN/METHOD
For achieving the research objectives and test the hypotheses, both inductive and deductive research design was applied. As well both qualitative and quantitative methods were put into application. Qualitative data was collected through secondary research, and quantitative data was collected through primary research.
FINDINGS/IMPLICATIONS
In general consumers in Indian FMCG industry are regular to purchase celebrity endorsed product. In general consumers in Indian FMCG industry are not so regular to purchase celebrity endorsed product .In most cases using the product and association with the product as forms of celebrity endorsement mostly appeals consumers in Indian FMCG industry. In most cases consumers in Indian FMCG industry assess value for money of products endorsed by celebrity prior to purchase. Generally the favorite celebrities of consumers in Indian FMCG industry are film stars and cricketers whose traits match their traits. Commonly for consumers in Indian FMCG industry breach of trust and high cost are the major risks in their opinion of purchasing celebrity endorsed product. There is strong and positive relationship between celebrity endorsement and consumer buying behavior. Moreover, the Pearson correlation between celebrity endorsement and consumer buying behavior is found significant at the 0.05 level (2-tailed). Thus, H1 is accepted. Further the Pearson correlation strongly hold up that celebrity endorsement is better than non-celebrity endorsement with regard to effecting consumer buying behavior with correlation significant at the 0.05 level (2-tailed). Thus, H2 is accepted.
TABLE OF CONTENTS
Acknowledgement
Abstract
Chapter #1 | INTRODUCTION |
1-5 |
|
1.1 | RESEARCH CONTEXT | 1 | |
1.2 | RESEARCH PROBLEM | 3 | |
1.3 | AIMS AND OBJECTIVES | 4 | |
1.4 | HYPOTHESES | 4 | |
1.6 | SCOPE | 4 | |
1.7 | STRUCTURE | 5 | |
Chapter #2 | LITERATURE REVIEW |
6-18 |
||
2.1 | INTRODUCTION | 6 | ||
2.2 | CELEBRITY ENDORSEMENT: ADVANTAGES AND | |||
DISADVANTAGES | 6 | |||
2.3 | EFFECT OF CELEBRITY ENDORSEMENT ON | |||
CONSUMER BUYING BEHAVIOUR | 11 | |||
2.4 | CONCEPTUAL FRAMEWORK | 16 | ||
2.5 | SUMMARY | 17 | ||
Chapter #3 | RESEARCH METHODOLOGY |
19-29 |
|||
3.1 | INTRODUCTION | 19 | |||
3.2 | RESEARCH DESIGN | 19 | |||
3.2.1 | Inductive Approach | 20 | |||
3.2.2 | Deductive Approach | 20 | |||
3.2.3 | Research approach for this research | 20 | |||
3.3 | RESEARCH METHOD | 21 | |||
3.3.1 | Qualitative | 21 | |||
3.3.2 | Quantitative | 22 | |||
3.3.3 | Research method for this research | 22 | |||
3.4 | DATA COLLECTION | 23 | |||
3.4.1 | Primary data | 23 | |||
3.4.2 | Secondary data | 23 | |||
3.4.3 | Data collection for this research | 24 | |||
3.5 | PILOT TEST | 24 | |||
3.5.1 | Pilot testing for this research | 24 | |||
3.6 | SAMPLING | 25 | |||
3.6.1 | Probability sampling | 25 | |||
3.6.2 | Non-probability sampling | 26 | |||
3.6.3 | Sampling selection for this research | 26 | |||
3.7 | DATA ANALYSIS | 26 | |||
3.7.1 | Data analysis for this research | 27 | |||
3.8 | ETHICAL ISSUE | 27 | |||
3.8.1 | Ethical issues for this research | 27 | |||
3.9 | VALIDITY AND RELIABILITY | 28 | |||
3.9.1 | Validity and Reliability for this research | 28 | |||
3.10 | SUMMARY | 28 | |||
Chapter #4 | FINDINGS AND ANALYSIS |
30-47 |
|||
4.1 | INTRODUCTION | 30 | |||
4.2 | ANALYSIS OF FINDINGS | 30 | |||
4.3 | HYPOTHESIS TESTING | 42 | |||
4.4 | SUMMARY | 47 | |||
Chapter #5 | CONCLUSION |
48-51 |
|||
5.1 | INTRODUCTION | 48 | |||
5.2 | SUMMARY OF FINDINGS | 48 | |||
5.3 | HYPOTHESIS TESTING | 49 | |||
5.4 | IMPLICATIONS/RECOMMENDATIONS | 50 | |||
5.5 | LIMITATIONS AND SCOPE OF RESEARCH | 51 | |||
BIBLIOGRAPHY |
52-56 |
APPENDIX |
57-60 |
Questionnaire | 58 |
List of Tables
Table 4.1: Respondents Gender | 30 |
Table 4.2: Respondents Profession | 31 |
Table 4.3: Frequency of Purchasing Celebrity Endorsed Product | 33 |
Table 4.4: Frequency of Purchasing Non-celebrity Endorsed Product | 34 |
Table 4.5: Consumers Appeal and Forms of Celebrity Endorsement | 36 |
Table 4.6: Consumers Perception of Value for Money and Celebrity Endorsement | 38 |
Table 4.7: Consumers Favourite Celebrity | 39 |
Table 4.8: Consumers Perception of Risk and Celebrity Endorsement | 41 |
Table 4.9.1: Descriptive Statistics | 43 |
Table 4.9.2: Correlations | 44 |
Table 4.10.1: Descriptive Statistics | 45 |
Table 4.10.2 : Correlations | 46 |
List of Charts
Chart 4.1: Respondents Gender | 31 |
Chart 4.2: Respondents Profession | 32 |
Chart 4.3: Frequency of Purchasing Celebrity Endorsed Product | 33 |
Chart 4.4: Frequency of Purchasing Non-celebrity Endorsed Product | 35 |
Chart 4.5: Consumers Appeal and Forms of Celebrity Endorsement | 36 |
Chart 4.6: Consumers Perception of Value for Money and Celebrity Endorsement | 38 |
Chart 4.7: Consumers Favourite Celebrity | 40 |
Chart 4.8: Consumers Perception of Risk and Celebrity Endorsement | 42 |
Chapter #1
INTRODUCTION
1.1 RESEARCH CONTEXT
India is one of the few places in the world where celebrities are adored and enjoy demi-god status, where people admire and revere celluloid stars. As a result, advertising and marketing practitioners in various industries take advantage of this opportunity to persuade the consumers emotionally to buy products that are publicized or marketed. People of almost all demographic backgrounds are under the similar influence of celebrity charisma (Katyal, 2007). After studying and analyzing advertising and marketing, researchers realize the academic and realistic groundwork of celebrity endorsements which interests them to look further into the subject- as to how and to what degree celebrity endorsements influence consumers in India to purchase the advertised products or brands. The researcher believes that undertaking such research tasks will not just improve the important individual knowledge on the subject, but will be of help to advertising and marketing practitioners in various industries. This is particularly in the context of the Indian consumer market that is going to develop remarkably in upcoming times.
Celebrity endorsement is a billion dollar industry in contemporary India. Every day a number of firms and businesses are signing contracts with celebrities hoping that by using them, they might achieve an exclusive and appropriate position in the psyche of the consumers (Kulkarni and Gaulkar, 2005; Katyal 2007).
Celebrity endorsement is more and more being put into application all through several industries not taking into consideration the product category. For illustration, a brand named Gillette used foreign actors and models to endorse their brand, however this failed to work and consumers in India did not recall foreign actors or even models they used. Nevertheless, when they utilized Rahul Dravid, a famous cricketer as their celebrity endorser, consumers were able to recall the brand (given that, in India, cricket is a very popular sport). Moreover, Indian celebrities are retained in the memory of consumers in the country and for that reason they are likely to be familiar with them. This illustration just defines what works and what does not work, as far as celebrity endorsement in the country is concerned. These issues will be examined through in detail in this research. Noticeably here, there are many cases where the products or brands, or even the entire mission fails to work because of high expectations of the celebrity as the firm or the advertisement is commercially ineffective in forming an association between the endorser and the products or brands. Keeping in mind the successful celebrity endorsements of products or brands, we find a long list, where the few foremost of them are listed in the Table.
Source: Agarwal et al., (2012)
As per a report by McKinsey Global Institute (2011), the consumer market in India is developing at a speedy and prospective tempo, and the country’s consumer market is all set to emerge as the fifth largest (from twelfth) globally by 2025, which is at present valued at US$ 511 billion. More importantly, consumers in the country are exposed to a number of new products everyday through the route of marketers’ differentiation and positioning strategies. As a result, it would be interesting to conduct a study examining the effect of celebrity endorsements on consumers purchasing behavior in the country, where the focus should be recognizing the attitude and perceptions of country’s consumers when it comes to celebrity endorsements. Sometimes celebrity endorsements work and sometimes fail, so it is of immense value to establish the facts regarding this especially from the perspective of firms and businesses advertising products through celebrity endorsement, where India is claimed to have emerged as a trendsetter. However, the issue requires empirical study. This research is an attempt in this regard and will be done by taking the case of FMCG industry in India.
1.2 RESEARCH PROBLEM
Over the years and particularly in recent years a number of studies have been conducted on the subject or issues where celebrity endorsement is concerned. These studies have brought into view quite a few new issues linked to the celebrity endorsements. For example, negative advertising of celebrities and ethical issues of celebrity endorsements etc. Besides there are numerous empirical studies now being carried out involving this in leading developed markets such as US and UK, but as far as researcher’s own knowledge is concerned, possibly none of the study has been carried out on the Indian consumer market in relation to the emerging issues of celebrity endorsement (Bailey 2007). Certainly there have been various studies carried out in relation to the subject on a common basis, and even very little studies have been conducted so far as demographic perspectives of the country’s consumers are concerned. Studies conducted by Jain (2008) and Surana (2008) are such examples but given that they target just a definite socio-economic section in India, that is to say students ranging the ages of 21-30 in the urban population, it cannot be considered for all demographic areas of India.
Therefore, this research aims to target consumers with different age groups and socio-economic background so as to give a broader perspective to the evidences presently in the research literature relating to celebrity endorsement in India. The foremost reason for selecting this subject for the research is linked to the fact that so far very few studies have been carried out to recognize the effect of celebrity endorsements on consumer buying behavior in the country, particularly in the context of issues such as negative effect and various demographical concerns. Rationally, the results of this research task will be ready to lend a hand in recognizing the perception and attitude of Indian consumers with regards to celebrity endorsements, which may divulge various interesting insights and clues for future research.
1.3 AIMS AND OBJECTIVES
The aim of this research was to examine the effect of celebrity endorsement on consumers buying behavior. The empirical research was conducted with regards to various socio-economic variables of demography taking the case of FMCG industry in India. The research attempts to achieve following objectives:
- To examine consumers’ frequency of purchasing celebrity endorsed products
- To examine consumers appeal and choice of celebrity and effect on purchasing decision
- To examine consumers perception of risk in purchasing celebrity endorsed products
1.4 HYPOTHESES
The research attempts to test following two hypotheses in this research:
H1. There is positive effect of celebrity endorsement on consumer buying behavior.
H2. Celebrity endorsement is better than non-celebrity endorsement with regard to effecting consumer buying behavior.
1.6 SCOPE
This research will come out with the results with regards to the advantages and disadvantages of celebrity endorsement; the effectiveness of celebrity endorsement on consumer buying process; the perception of celebrity endorsement of consumers from different backgrounds; and what works and what does not work in celebrity endorsement. The results will be particularly in relation to the socio-economic factors of consumers’ background from the Indian FMCG industry. These results will help the firms in Indian FMCG industry not only to evaluate their current advertisements of celebrity endorsements, but also those that they are planning to do in the future. Despite the fact that the results will be exclusive for FMCG sector, the implications will be somewhat equally useable for advertising practitioners in other industries of the country, given that the results will be of general nature.
1.7 STRUCTURE
Introduction
The chapter basically contains research context and research problems, together with aims and objectives, research questions and hypotheses. Scope and structure are the additional useful parts in the chapter.
Literature Review
This chapter conducts the review of the accessible research literature with regards to effect of celebrity endorsement on consumers buying behavior. The review is conducted with specific reference to India. Apart from these, the concepts of celebrity endorsement and consumer buying behavior too are defined, along with the advantages and disadvantages of celebrity endorsement.
Methodology
This chapter details the research approach applied to conduct the research, research methods put into application to answer research questions and testing hypotheses, the various data collection methodologies used and the data analysis method. Validity and reliability with ethical issue are additional parts in the methodology.
Data Analysis
This chapter presents the analysis of the data collected in qualitative and quantitative forms. The central focus of the chapter is on answering research questions and testing hypotheses.
Conclusion
This chapter presents the summary of the research, together with managerial implications and scope of future research.