Influence Of Celebrity Endorsements On Brand Preference Among Student Of Novena University (A Case Study Coca-Cola)

Project and Seminar Material for Marketing

Influence Of Celebrity Endorsements On Brand Preference Among Student Of Novena University (A Case Study Coca-Cola)


Abstract


Celebrities are the personalities that are well known in public either because of their credibility or of their attractiveness or because of both of these. To leverage this, advertisers use celebrities in their advertisement to increase the effectiveness and heighten the credibility of commercials. Research has proven that celebrity endorsement does cast its impact, but other schools of thought attest the contrary. This research work moves on the positive line and affirms the influence of Celebrity Endorsement on Consumer brand preference with a case study of; Coca cola Bottling Company Plc. Celebrity endorsement business has become a multi-million naira industry in Nigeria. Marketers use celebrity endorsers to influence the purchase decision of consumers in order to increase their sales and extend their market shares. This research work will critically analyze how celebrity endorsement in advertisement as a tool affects and influences people’s opinions in marketing and its effect in the society compared to other forms of advertising. The methodology of collecting data for this research work will be through both primary and secondary research which will involve questionnaire and reviewing relevant literature such as journals, articles, texts, print media, social media and electronic media in this area of study. The data collected will be qualitative which will be analyzed and presented in forms of tables. Finally, the results of the study prove that celebrity endorsements positively impact the purchase intention of the consumers.


Table of Content


  • Title Page
  • Certification
  • Dedication
  • Acknowledgement
  • Table of Content
  • List of Tables
  • Abstract

Chapter One:

Introduction

  • 1.1 Background of the Study
  • 1.2 Statement of the Problem
  • 1.3 Objective of the Study
  • 1.4 Research Questions
  • 1.5 Research Hypothesis
  • 1.6 Significance of the Study
  • 1.7 Scope of the Study
  • 1.8 Limitation of the Study
  • 1.9 Definition of Terms
  • 1.10 Organisations of the Study

Chapter Two:

Review of Literature

  • 2.1 Conceptual Framework
  • 2.2 Theoretical Framework
  • 2.3 Empirical Review

Chapter Three:

Research Methodology

  • 3.1 Research Design
  • 3.2 Population of the Study
  • 3.3 Sample Size Determination
  • 3.4 Sample Size Selection Technique and Procedure
  • 3.5 Research Instrument and Administration
  • 3.6 Method of Data Collection
  • 3.7 Method of Data Analysis
  • 3.8 Validity of the Study
  • 3.9 Reliability of the Study
  • 3.10 Ethical Consideration

Chapter Four:

Data Presentation and Analysis

  • 4.1 Data Presentation
  • 4.2 Analysis of Data
  • 4.3 Answering Research Questions
  • 4.4 Test of Hypotheses

Chapter Five:

Summary, Conclusion and Recommendation

  • 5.1 Summary
  • 5.2 Conclusion
  • 5.3 Recommendation
  • References
  • APPENDIX
  • QUESTIONNAIRE

Chapter One


Introduction

1.1 Background to the Study

The use of advertising went through a major phase of change over many years, from classical to modern view. In the modern days, marketers are developing strategies using various appeals including sexual, emotional, humour, etc. (Belch and Belch, 2011). The motive behind formulating such strategies is to gain high brand exposure, attention, interest, desire and action (Belch and Belch, 2011). In order to do this, marketers employ well known and famous personalities in other word celebrities. As McCracken, (2015) stated that celebrities tend to create greater effect on the consumers buying behaviour. McCracken, (2015) further states that celebrity endorsement advertising is a ubiquitous feature of modern marketing.

According to Silvera and Austad, (2014) Celebrities are people who enjoy public recognition among a large group of people and possess distinctive qualities like attractiveness and trustworthiness. Many big brands have recognised the importance of celebrity endorsements as marketing communication tool (Soderlund, 2013). Celebrity Endorsements is a billion dollar industry in today‘s era. (Kambits et al., 2002). Marketers spend huge amount of money on celebrity endorsement contracts annually (Katyal, 2017) it shows that celebrities play an important role in the advertising industry.

According to Jefkins F. (2000), advertising is a practical affair which differs with marketing; marketing drives products and services to the customers while advertising drives customers to the product or services. Patley, (2014) states that advertising is promotion of goods or services for public and its goal is drawing attention of people and showing favourable light to them.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 (McCracken 2015; Belch 2011; Soderlund 2013).


1.2 Statement of the Problem

Celebrities endorsement has been one of the main advertising strategies to persuade and get sales. In a study conducted by Hsinkuang, Huery, Shih and Yi (2011) show that consumers show greater recall of products that have been endorsed by celebrities regardless of whether they are actual fans or not. The human brain recognizes celebrities quicker to how it recognizes people we actually know (Okoli, 2016). They added that if consumers happen to be fans, they place a higher value on products that celebrities are endorsing it is as if they are receiving advice from a valued friend. Also, critics have identified the use of celebrities vouching for or promoting products, brands as deceptive form of marketing as some consumers may consume product or use a brand because its sport lord has been used to advertise it.

The exploration of this research topic is motivated by several factors. It seeks to examine whether celebrity endorsement in advertisements works and how it works. It also aims to identify attributes of celebrity endorsers and attributes of celebrity endorsement advertisements that are most appealing to target audience. This research work also seeks to examine audience’s perceptions about how celebrity endorsements in advertisements work. Every advertisement aims to create awareness and arouse interest in the minds of customers. Celebrity Endorsement is one of these power tools by which advertisers try to leverage the image and identification of the celebrity to promote a brand. This makes the advertisement lively, attractive, interesting, but attention getting as well because audience takes the celebrity as a role model and in turn these celebrities impact their lives. Advertisers try to hire such celebrities for endorsement who are not only attractive but credible as well. The all-embracing purpose of this research work is to increase additional concerned of changed factors which are particularly associated to behavior of consumers, brand image, consumer prescription by advertising.


1.3 Objectives of the Study

The Primary objective of this work is to study the influence of celebrity endorsements on brand preference among student of novena university (a Case Study Coca-Cola)., and to examine awareness, appeal and relevance in setting up of the promotional strategies as well as to test the celebrity impact on consumers. Based on this primary objective, other supporting objectives are set as presented below

  1. To explore and examine the current state of consumers perception about celebrity endorsements.
  2. To examine the impact of celebrity endorsement on brand preference.
  3. To analyze the perception of students and professionals about the celebrity endorsement.
  4. To find out the relationship between celebrity endorsement and customer buying behaviour.
  5. To analyze that which factor of celebrity attracts more to the public.

1.4 Research Questions

The study seeks to address the following questions;

  1. What is the impact of celebrity endorsements on consumers brand preference?
  2. To what extent is the relationship between celebrity endorsement and buying behaviour?
  3. What is the relationship among the celebrity attributes?

1.5 Research Hypotheses

The following research hypotheses will be tested for the purpose of this research work:

Hypotheses One
  • H0: There is no impact of celebrity endorsement on brand preference.
  • H1: There is an impact of celebrity endorsement on brand preference.
Hypotheses Two
  • H0: There is no any relationship between celebrity endorsement and buying behaviour.
  • H1: There is a relationship between celebrity endorsement and buying behaviour.

1.6 Significance of the Study

This research work will help firms understanding the importance of celebrity endorsement in advertisement. It will also enable them structure their adverts and brands to make them more appealing in order to influence consumers buying behaviour. The final aim of every advertising strategy is to instigate the actual behaviour of the targeted audience, whether purchase intention or actual consumption (Sharma et al. 2008). If an advertising strategy fails to achieve the same, the million naira spent are not worth it.

Academically, this research work will be helpful in understanding the perception and attitude of Nigerian consumers towards celebrity endorsements which may reveal some interesting insights and directions for future research. It is also believes that conducting this research work will enhance the valuable personal knowledge of the researcher about the subject and experience for future career applications.


1.7 Scope of the Study

The scope of this research work is within the influence of celebrity endorsements on brand preference among student of novena university (a case study of coca-cola).

The research project has got three limitations. One is given the unavoidable and that is the limitation of time. The project being a student project needs to be completed within a specified period set by the University and therefore one compromises can be made in this respect.


1.8 Limitation of the Study

In the course of carrying out this study, the researcher experienced some constraints, which included time constraints, financial constraints, language barriers, and the attitude of the respondents. However, the researcher were able to manage these just to ensure the success of this study


1.9 Definition of Terms

Advertising:

Advertising“is any paid form of non-personal presentation and promotion of goods, services, or ideas by an identified sponsor.”

Advertising Media:

Is the channel through which advertising message is delivered to the target audience: (Example magazine, radio, television), (Stanton, 1981).

Advertising Budget:

“This refer to the total percentage of allocate for advertisement program in the organization it could be annually, quarterly or monthly base” (Kotler and Keller 2005).

Consumer:

“A person who use anything made by the producer” (Miller, 1961).

Consumer Buying Behavior:

Is the sum total of a consumer’s attitudes, preferences, intentions, and decisions regarding the consumer’s behavior in the marketplace when purchasing a product or service.

Product:

Anything that can be offered to the market for attention.


1.10 Organization of the Study

This research work is organized in five chapters, for easy understanding, as follows.

  • Chapter one is concern with the introduction, which consist of the (overview, of the study), historical background, statement of problem, objectives of the study, research hypotheses, significance of the study, scope and limitation of the study, definition of terms and historical background of the study.
  • Chapter two highlights the theoretical framework on which the study is based, thus the review of related literature.
  • Chapter three deals on the research design and methodology adopted in the study.
  • Chapter four concentrate on the data collection and analysis and presentation of finding.
  • Chapter five gives summary, conclusion, and recommendations made of the study.

Chapter Five


Summary, Conclusions and Recommendations

5.1 Summary of Findings

Nigeria is a country where people love to live in dreams. They worship celebrities. They treat them as Icons. Marketers use this very preposition so as to influence their target customers existing or potential ones. For this they rope in these celebrities and give them whopping amount of money. They believe that by doing this they can associate their products with their target customers. This is called celebrity endorsement. The field of consumer behavior is the study of individuals, groups or organizations and the processes they use to select, secure, use and dispose of product, services, experiences, or ideas to satisfy needs and impacts that these processes have on the consumer and society. And understanding the consumer behavior is the prime and toughest task in front of every marketer. There are a lot of factors, which influence consumer buyer behavior. This study aimed at to understand the influence of celebrity endorsement on consumer buying behaviour. Marketers pay millions of Naira to celebrity endorsee hoping that the stars will bring their magic to brand they endorse and make them more appealing and successful. But all celebrity glitter is not gold. The celebrity endorser fits in between these two interactions, where he tries to bring the image of the product closer to the expectation of the consumer, by transferring some of the cultural meanings residing in his image to the product. Now, despite the potential benefits derived from celebrity endorsements, they increase a marketer’s risk manifolds and should be treated with full attention and aptitude. What therefore seems relevant by the study is that, yes, definitely celebrity endorsee influence consumer buying behaviour and brand building but while using celebrity endorsee, marketer has to take care of all the aspect that whether they brought personality and image of celebrity matches or not, whether celebrity endorsee has deep penetration among the masses or not, whether he is considered as credible source or not etc.


5.2 Conclusions

Celebrity endorsements has changed the way advertising used to be few decades ago. It is been accepted to be a “ubiquitous feature of modern day marketing” (McCracken, 2015). As a result, a greater understanding of consumer’s reactions towards celebrity endorsements can help the marketers to use it more effectively. This research project explored the current state of consumer’s perception about celebrity endorsements. Empirically identified and tested the celebrity attributes specific to influence purchase intention and finally examined the impact of celebrity endorsements on consumers buying behaviour. In accordance with the study objectives, the following conclusions are drawn.
The research project examined and explored the current state of consumer’s perception about celebrity endorsements. Research outcomes reveal extremely high degree of familiarity across all age groups. Results reveal that people find celebrity endorsements more attractive, particularly young people and teenagers. Further, on the basis of attractiveness people find film stars more influential as endorsers. Results reveal that using a celebrity in an advertisement increases the recognition and recall rate of the endorsed product. Overall it is believe that celebrity endorsements are more attractive, and effective at influencing consumer buying behaviour. Interestingly, people know and agree that celebrities don‘t really use the products endorsed by them. Even though, celebrity endorsements have a very positive impact on consumer’s perceptions and attitudes towards the endorsed product.

Celebrity endorsed advertisements are more attractive than the non-celebrity endorsed advertisements. Respondents also voted that the best medium for watching the advertisements is TV and then Internet. It is further concluded that the highest relationship existed between the perception and the buying behavior. The lowest relationship is, between celebrity attractiveness and the perception. There is a significant relationship among all attributes of the celebrity. It is finally concluded that there is a significant relationship between celebrity endorsement and buying behavior. Respondents clearly conveyed that they do purchase those products and services, which are endorsed by the celebrities.

The positive relationship of different celebrity attributes and purchase intention of the consumers demonstrates the effectiveness of celebrities as successful endorsers. Although some attributes are very effective at influencing purchase intention of consumers some are relatively low or moderate. Accordingly the other attributes were ranked as trustworthiness, likeability, meaning transfer, similarity and product match-up. This shows that there is a difference between what consumers actually do and think. It is also crucial to keep in mind that selection of a celebrity endorser should not only be done over the two most important attributes but also consider the remaining as a priority, since these may strengthen the impact of a celebrity over purchase intention. Overall it can be said that the different attributes of the celebrities positively affect consumers buying behaviour. In overall, all the research objectives have been achieved leading to better understanding of celebrity endorsements.


5.3 Recommendations

Advertising is crucial for the purposes of marketing and creating awareness of the products to different target audience.

This researcher recommends that in order to have businesses and organizations thrive well in the market they need to choose the right marketing channels, media and celebrities to use so as to make the communication effective. The researcher also recommends that before choosing any celebrity to use, analysis of the target group they want to communicate to should be done, the product being advertised and the message being put across so as to make the right choice of a celebrity to match the product:

  1. Celebrity endorsements will be more effective when used consistently over time to increase the strength of the link between the celebrity and the endorsed brand.
  2. Celebrity endorsements will be more effective when the ad execution is simple, clean and free of irrelevant design elements. Focus on the celebrity and the brand together.
  3. Celebrity endorsements will be more effective when using a celebrity who is not already strongly associated with another product or service.
  4. Celebrity endorsements will be more effective when using a celebrity with a high “fit”, “congruence”, or “belongingness” with the endorsed brand. Celebrity endorsers can be used to effectively reinforce and/or create an image for a product or service.
  5. Celebrity endorsements will be more effective for less familiar brands.
  6. Celebrity endorsers will be more effective for brands for which consumers have limited knowledge/facts.
  7. Celebrity endorsers will be more effective when integrated across the elements of the marketing mix.
  8. Caution in choice of celebrity endorser is warranted given the potential risk of tarnishing the brand’s image.

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