Research Methodology on Effect of Celebrity Endorsements

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Research carried out to see how celebrity endorsements affect customer's buying habits

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Research Methodology on Effect of Celebrity Endorsements

  1. 1. Celebrity Endorsement & Its Effect on Consumers
  2. 2. What is Celebrity Endorsements • A form of brand or advertising campaign that involves a well known person using their fame to help promote a product or service. • Social media such as Twitter have become increasingly popular mediums for celebrities to endorse brands and influence purchasing behaviour.
  3. 3. NEED FOR CELEBRITY ENDORSEMENT • It increases the sale • Attract more attention of consumers • Celebrity add new dimension to the brand
  4. 4. The Benefits of Celebrity Endorsements • Build brand equity • Help people remember ads
  5. 5. • Make people believe the product contributes to superstar status • Stand out
  6. 6. The Risks of Celebrity Endorsement • Images change • Celebrities become overexposed • Celebrities can overshadow brands
  7. 7. Why are advertisers ready to pay crores for endorsements? The reason is “Install Recall” which ensures immediate focus to the brand.
  8. 8. Why do brands, during losses, sign celebrities to endorse? Companies use celebrities to come out of losses, basically when a brand needs to lift itself to come out of losses.
  9. 9. Objectives of the research • To understand how does celebrity endorsements have an impact on customers buying habits • To understand what makes the company or ad agency select a particular celebrity for their product • To understand what makes a celebrity take a particular brand for endorsing
  10. 10. Methodology Part 1 Primary Survey The primary survey was carried out in three different sections: • Consumers • Celebrity • Advertisement agencies - Ogilvy & Mather Lowe Lintas FCB ULKA
  11. 11. Consumers QUESTIONNAIRE 1. Gender •Male •Female 2. What is your age? •Below 20 years •Between 20 to 49 years •Above 50 years 3. Which of the following influences you to buy a product? •Celebrity endorsement •Price •Quality
  12. 12. 4. Rate the media that affects your buying power for the product- Very Effective 1 Effective 2 Neutral 3 Average 4 Ineffective 5 TV and/or Radio Print media On the shelf Word of mouth 5. Rate the impact of the celebrity endorsing the product- Strong Impact Weak Impact 1 2 3 4 5 6. Would you stop buying the product if your favourite celebrity stops endorsing it? +2 - Definitely +1 0 - Maybe -1 -2 - Never 7. Did it affect your buying decision for the SAME PRODUCT, when - Celebrity WASN’T Endorsing Celebrity STARTED Endorsing 3 2 1 0 1 2
  13. 13. 8. Rate if negative publicity about your preferred celebrity influences your purchasing decision- +2 - Doesn’t influence at all +1 0 - Neutral -1 -2 - Influences heavily 9. Do you believe that the celebrities also use the products which they endorse? •Yes •Not Sure •No 10. How does your preferred celebrity and a specific brand they endorse affect the buying decision of the product Strongly Agree 1 Agree 2 Neutral 3 Disagree 4 Strongly Disagree 5 He/She has a positive impact on the product He/She can relate to consumers He/She suits the brand image He/She has knowledge about the product and brand
  14. 14. Ad Company
  15. 15. Questionnaire Q1. What is the primary reason to choose a particular celebrity/model for endorsing a product? 0 0.5 1 1.5 2 2.5 3 Requirement of the script Budget Brand Popularity Any Other 2 0 3 0 Attributes
  16. 16. Q2. How do you judge if the celebrity is worth the money? 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 Popularity Acting Skills Connection with the target audience Any Other 1 1 1 0 Celebrity Worth
  17. 17. Q3. What market research tool does your company use before framing an Advertisement? 0 0.5 1 1.5 2 2.5 3 Qualitative Technique Questionnaire + CG Method Account Planning Any Other Market Research Tool
  18. 18. Q4. Do you think the celebrity/model influences the consumers’ purchasing decision? 0 0.5 1 1.5 2 2.5 3 Yes Partially, to some extent No Celebrity Influence
  19. 19. Q5. Do you feel that selecting high-profile celebrities creates more impact than general advertisement models? 0 0.2 0.4 0.6 0.8 1 1.2 1.4 1.6 1.8 2 Yes Partially, to some extent No Impact of High Profile Celeb over Regular Model
  20. 20. Celebrity • Sunil Vishrani a.k.a. Chattri Man of TIDE Washing Powder Advertisement. • He was interviewed on aspects like how does an advertisement affect the celebrity/model (himself), on what basis does the company select the celebrity/model for an advertisement and many more.
  21. 21. Methodology Part 2 Research Analysis through SPSS
  22. 22. Which of the following influences you to buy a product- Quality Celebrity endorsement Price PURCHASE INFLUENCE
  23. 23. Rate the media that affects your buying power for the product 75 3 31 17 22 24 33 23 3 29 15 21 0 20 12 22 0 24 9 17 0 10 20 30 40 50 60 70 80 TV and/or Radio Print Media On the Shelf Word of Mouth Media Channels Very Effective Effective Neutral Average Ineffective
  24. 24. One Sample T-Test One-Sample Statistics N Mean Std. Deviation Std. Error Mean Celebrity_Impact 100 2.1100 1.03372 .10337 One-Sample Test Test Value = 2 t df Sig. (2- tailed) Mean Difference 95% Confidence Interval of the Difference Lower Upper Celebrity_Impact 1.0 64 99 .290 .11000 -.0951 .3151 Ho= The mean rating given for the celebrity impact on the product is 2 (i.e. Good Impact) Ha= The mean rating given for the celebrity impact is not equal to 2. At 5% level of significance, the α value is 0.05 & the significant value is 0.290. Since the significant value is higher than the α value, we accept our null hypothesis & conclude that the mean rating given for the celebrity impact on the product is 2, i.e. the celebrity has a good impact on the product.
  25. 25. Paired Sample T-Test Paired Samples Test Paired Differences t df Sig. (2- tailed) Mean Std. Deviation Std. Error Mean 95% Confidence Interval of the Difference Lower Upper Pair 1 Before_Endorsing - After_Endorsing .6400 1.03005 .10301 -.84438 -.43562 -6.213 99 .000 Ho= There is no significant difference between the buying decision of the customer before & after the celebrity endorsed the product. Ha= There is a significant difference between the buying decision of the customer before & after the celebrity endorsed the product At 5% level of significance, the α value is 0.05 & the significant value is 0.000. Since, the significant value is less than the α value, we reject our null hypothesis & conclude that there is a significant difference between the purchase intention of the customer before & after the celebrity endorsed the product
  26. 26. Descriptive Statistics Mean Std. Deviation N Loyalty 1.0200 .99473 100 Negative_Publicity 1.1200 .89081 100 Correlations Loyalty Negative_Publicity Loyalty Pearson Correlation 1 .225* Sig. (2-tailed) .024 N 100 100 Negative_Publicity Pearson Correlation .225* 1 Sig. (2-tailed) .024 N 100 100 *Correlation is significant at the 0.05 level (2-tailed). There is a weak correlation between loyalty of the customer & negative publicity of the celebrity which means that the loyalty of the customer towards the product is not affected by the negative publicity of the celebrity. Correlation
  27. 27. Conclusion • Primary Reason by Ad company to chose a celebrity is Requirement of the script & Brand Popularity (relatable to the public) • Celebrity is worth the money is decided by their Popularity (Mass appeal) and Connection with the target audience • Television/ Radio Ad and On-the-shelf are the most effective mode of influencing for purchasing a product • Customers find strong impact of the celebrity for the product they endorse • Change in purchase intention of customers before & after the celebrity endorsed the particular product • Loyalty of the customer towards the product is not affected by the negative publicity of the celebrity.
  28. 28. BIBLIOGRAPHY • www.google.co.in • www.ogilvy.com • www.lowelintas.com • www.fcbulka.com • www.Wikipedia.com
  29. 29. PRESENTED BY: • Abhishek Shinde • Abhishek Bhatt • Divya Gandhi • Karen D’souza • Ketaki Misra • Kirk Coutinho

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