BUSINESS RESEARCH METHODS

PROJECT SYNOPSIS: Group 10

Submitted By Apaar Gupta (10B), Avneet Handa (14B), Mayank Tewari
(29B), Nidhi Jindal (33B), Pulukuri Sivaji (50B)
Title:- To study the impact of celebrity endorsements on consumer
purchase intention in India

I. INTRODUCTION

Marketing encompasses all the actions and business activities from

promoting to selling products or services. It is the process which moves
goods and services from just as a concept to its final form to the customer.
And advertising forms an integral part of the whole marketing process as
it is a form of communication which informs both the current as well as
the potential customers about the availability and the usage of the
product or the service. Advertisements can be primarily of two types- to
inform about a new product/service or to increase the usage rate or
pattern of an already established product/service. Today, the biggest
challenge marketers face is to stand out from the clutter. Marketers just
need not advertise about their product or its advantages to its customers
but also to do so in a very unique and emphatic way so as to create a
memorable experience for the viewers/audience- all in a span of few
seconds. The aim for marketers is to find a hook, that killer insight, that
will hold the subjects attention. And to achieve that, Celebrity
endorsements in the marketing campaigns across various marketing
activities is a widely used marketing strategy.
Backed by healthy salary hikes, rising aspirations and easy credit, Indian
consumers are spending more on new products - both online and offline.
Increasing disposable income available to the Indian consumers has
increased their expenditure on goods and services. Clearly todays
consumer is willing to spend on appealing products.
A number of costly ad campaigns built around star endorsers have failed
to take of despite the stars having a proven track record at successfully
endorsing products. In the recent past a number of controversies such as
the Maggi and Snapdeal have raised questions on the relevance and
credibility of extending of the celebritys image to the product endorsed.
In these cases factors beyond the control of the company have resulted in
negative backlash on its brand image.
A noticeable trend in advertising is the increasing use of alternative
advertisements that do not make use of celebrities to pitch their product.
Some of these campaigns have enjoyed great success and have great
recall value. Social media plays a big role in the in helping such
campaigns gain traction and go viral. Influencers on social media pose a
significant challenge to celebrities as they integrate better with consumer
lifestyle.

Given the widespread use of celebrity endorsements it is essential that

this strategy be reviewed for its ability to actually affect purchasing
behavior.

II. LITERATURE REVIEW

Products are made in factories, brands are made in minds- it exemplifies
what marketing has always been about, in its truest sense. And to to do
that in a country like India is no mean task. Indian market is not by a large
space, an easy audience to target for the marketers. In fact, it is often said
by the marketers that India is not a single country- owing to its numerous
beliefs, ethnicity, languages, cultures and values. Other aspects such as
vast economic discrepancies has led to huge disparity in the buying power
and decision making of various sects of people, which should be kept in
mind by advertisers.
Indian advertisement has been placing a vital amount of importance on
both recall and persuasion as brand differentiating messages. Very often,
various advertising styles are used by advertisers to influence consumer
brand choice behaviour and 12 among these different available choices
one very popular choice is Celebrity Endorsements. Traditional celebrity
endorsements are as well established as the concept of celebrity itself
.Celebrities influence on consumers appears to be larger than ever before.
When used effectively celebrity endorsers have the potential of serving a
valuable role in enhancing a brands competitive position and developing
brand equity. It also highlights the subtle yet intense impact of celebrities
on everyday thinking and living. Defined as intimacy at a distance, it is
seen that individuals have a tendency to form illusions of an interpersonal
relationship with celebrities (Pugazhenthi and Ravindran, 2013)
Celebrity endorser is defined by McCracken (1989) as any individual who
enjoys public recognition and who uses this recognition on behalf of a
consumer good by appearing with it in an advertisement. According to
Freidman and Freidman (1979), celebrities are usually known to the public
or their accomplishments in areas other than the product endorsed by
them. They also argue that celebrities are more effective than other forms
of endorsers.
Celebrity endorsements have been widely used in India and also across
the globe. What started. What started with Farokh Engineer as the
Brylcreem Man in 1986 has become an integral part of advertising world
today (in India). So much so that, almost 86% of the respondents across
India agree that the most prominent ads that they recall have an celebrity
in them (IMRB, issue 3, December 2008). In India especially, it is not
difficult to find motives for the increasing use if celebrities in
advertisements as Indians have always been in awe of the stars of the
celluloid world. Unlike the foreign counterparts they have always
consecrated them and placed a halo behind their heads implying that
their celebrities could do no wrong. Indeed, some people are seen to
admire, imitate, and become besotted with their favourite celebrities,
which forms the crux for the celebrity endorsement being quite a sought
after advertisement technique. (McCutcheon et al 2003).

However, inspite of prevalent use of celebrities for endorsement, not all

celebrity endorsements have been successful even in India, as consumers
were not able to identify with some celebrity advertisements. When
Hindustan Unilever Limited (HUL) Indian subsidiary of Unilever - tried to
use Shahrukh Khan for endorsing Lux, by canvassing the image of a
metro-sexual man, the promotion did not turn out to be very successful.
Shahrukh Khans association with Videocon, a leading white good
manufacturer, had to be discontinued as the promotion did not give
adequate results. Leading automobile company Maruti Suzuki was unable
to exploit the Big B status of Amitabh Bachchan for its Versa brand.
(Abhishek and Sahay, 2013). Also, there are risks associated with celebrity
endorsements in the way that sometimes the celebrities get embroiled in
controversies which can impact the brands they are closely associate
with- case in point, last year when Aamir Khan (then brand ambassador of
Snapdeal) made some comments about Intolerance in India, Snapdeal
had to pay the price too as hashtags like AppWapsi and No to Snapdeal
trended across various social media websites and resulted in
uninstallations and downvotes of their app.
The list of unsuccessful examples suggest that it will be wrong to consider
celebrity endorsement as an effective response to media clutter in all
situations in spite of the intensity of involvement people have with
celebrities in India. It is also accentuate by the fact reported by a survey
conducted by IMRB in 2008, which showed that only 3% people cross India
consider the presence of a celebrity before purchasing the product. In
order to enhance the effectiveness of celebrities, it has been suggested
that marketers need to establish the link between the product and
celebrity by considering the type of product. However, the utility of this
theory often explained as congruence between product and celebrity - in
explaining the effectiveness of celebrity endorsement is limited as seen
by the example of Shahrukh Khan endorsing Hyundai Santro and Amitabh
Bachchan endorsing Versa. While both the brands belong to same product
category and are endorsed by the leading Indian actors having pan-India
appeal, the results have been quite different.
Agarwal and Kamakura, (1995), cites industry sources who estimate that
approximately 20% of all television commercials feature famous people.
Certain sets of products feature celebrity endorsements more often. They
studied all endorsement contracts over the period 1980-1992. In their
sample 60% of the endorsement deals involve soft drink companies and
athletic shoes manufacturers. They also provide an event study that
examines abnormal stock returns on the day that a company announces
the signing of a celebrity for product and endorsement purpose. How
celebrity endorsements affect consumer purchase decision is studied
extensively by marketing and social psychology researches. Various
hypothesis have been put forward including celebrity endorsement have
recall of the product, (ii) celebrities have credibility on expertise that
makes the product more desirable or enhances perceptions of quality (iii)
the celebrity endorsers image is transferred to the product so that those

who use the product are associated with the image (Pugazhenthi and
Ravindran, 2013)

III. Research problem and objectives

1. To know the consumer perception and behavior towards
advertisements in various media
2. Understand the Key drivers in purchase decision of consumers
3. Identify the key factors of celebrity endorsements that have
maximum impact on the purchase decision

IV. Questionnaire
*What is your gender?
Male
Female
* What is your highest level of education?
High school
Graduate
Post-Graduate
Other
*What is your profession?
Student
Business/ Finance Professional
Retail sector
Marketing
Unemployed
Other
*1.What do you value the most when purchasing product?
Price of the product
Celebrity Endorsement
Quality of the product
Value of Money
Experience
Other:

*2. How frequently do you come across advertisements that

feature celebrities?
Often
Sometimes
Rarely
Never
*3. What attracts you more: Celebrity endorsed advertisements or
non-celebrity advertisements?

Celebrity endorsed advertisements

Non celebrity advertisements
*4. Does the presence of celebrities help you recognize the
brand?
Agree
Slightly agree
Not sure
Slightly Disagree
Disagree
*5. Good looking celebrities attract your attention more than
those you do not consider good looking. ?
Agree
Disagree
*6. Do you think the physical attractiveness of a celebrity affects
your perception and attitude towards the product or brand
endorsed?
Yes
No
*7. Does you think product sales are higher because of celebrity
endorsement?
Agree
Slightly agree
Not sure
Slightly Disagree
Disagree
*8. Does the presence of celebrities Motivates you to purchase
the product?
Agree
Slightly agree
Not sure
Slightly Disagree
Disagree
*9. You are more likely to buy products that have been endorsed
by

celebrities than non-celebrity endorsements.

Agree
Slightly agree
Not sure
Slightly disagree
Disagree
*10. Your favorite celebrity gives a positive image to the
endorsed brand
Agree
Slightly agree
Not sure
Slightly disagree
Disagree
*11. Will you buy a product if your favorite celebrity is endorsing
it?
Agree
Slightly agree
Not sure
Slightly disagree
Disagree
*12. You believe celebrity also use the product which they
themselves endorse.
Agree
Slightly agree
Not sure
Slightly disagree
Disagree
*13. Do you think celebrity give a true picture of product through
advertisement?
Agree
Slightly agree
Not sure

Slightly disagree
Disagree
*14. You dont believe products specifically advertised by the
celebrities are of good quality
Agree
Slightly agree
Not sure
Slightly disagree
Disagree
*15. You think investing large amount of money for using
celebrities helps companies to increase their total revenue
Agree
Slightly agree
Not sure
Slightly disagree
Disagree
*16. You think celebrity endorsement helps in string brand
promotion
Agree
Slightly agree
Not sure
Slightly disagree
Disagree
*17. How influential to a purchase decision do you think celebrity
endorsement is?
Very influential
Influential
Somewhat influential
Not at all influential
*18. How often is your purchase decision based on celebrity
advertisement recall?

Mostly
Rarely
Often
Never
*19. Do you consider the expertise a celebrity may have as
influential when making a purchase decision? Eg. Makeup artist
Highly influential
Influential
Slightly influential
Doesnt make a difference
*20. Do you consider trustworthiness as influential when making
a purchase decision? (Trustworthiness refers to the honesty and
believability of the celebrity)
Highly influential
Influential
Slightly influential
Doesnt make a difference
*21. Do you think the sense of similarity between yourself and the
celebrity endorser as influential when making a purchase
decision?
Highly influential
Influential
Slightly influential
Doesnt make a difference
*22. Do you consider the familiarity of the celebrity influence your
purchase decision?
Highly influential
Influential
Slightly influential
Doesnt make a difference
*23. As a consumer, do you consider the likeability of the celebrity
as an influential factor when making a purchase decision?
Highly influential
Influential
Slightly influential

Doesnt make a difference

*24. Do you think the relevance of the celebrity to the product is
influential when making a purchase decision? (ie. Skin care, anti
ageing etc)
Highly influential
Influential
Slightly influential
Doesnt make a difference
*25. Do you feel that Negative Publicity about a celebrity
endorser can influence your purchase decision within the
cosmetics industry?
Yes
No
Sometimes
Dont know
*26. Overall would you consider the presence of celebrity
endorsement as positive or negative when making a purchase
decision?
Positive
Negative
*27. Do you purchase products endorsed by celebrities?
Always
Often
Sometimes
Not sure
Never
*28. Which medium do you consider most effective when celebrity
endorsement is used?
Television advertisement or infomercial
Magazine and Print advertisements
Internet advertisement
Radio advertisement
*29.What type of celebrity endorsement persuades you personally
to purchase products?
Film Star
Famous personalities
Cricketer
Politician

*30.What do you think is the reason for the companies to choose

celebrity endorsement for promoting their products?
Easy recognition of product
Cannot generate new ideas
To be able to increase sales and profits
To compete strongly

V. SAMPLE SIZE DETERMINATION

The formula below provide the sample size needed under the requirement
of population proportion interval estimate at (1 ) confidence level,
margin of error E, and planned proportion estimate p. Here, z2 is the
100(1 2)th percentile of the standard normal distribution.
2
n = Z 2 p(1 p)
2
E

Assuming 5% margin of error, we plan to find the sample size for our
target population at 95% confidence interval.

SAMPLING DESIGN
Owing to the lack of resources and time constraints, we plan to use
Convenience sampling where the respondents would be chosen based on
their relative ease of access. Thus, the sample predominantly consists of
friends and relatives and their acquaintances. Majority of the respondents
would be either college students or young corporate professionals.

I.

II.

TARGET POPULATION

The Target Population for the survey has been perceived as individuals in
Delhi in the age bracket of 15-35 (in years), educated, aware about the
daily dealings of the world, ambitious in their lives and motivated to
achieve them.

SAMPLING FRAME

We intend to use online survey method for our research purposes. So

only those accessible and able to aptly respond to us through online
methods/surveys would comprise our sampling frame.

According to the India Demographic Profile estimated for July 2016,

Proportion of population in age bracket of 15-35 years of age has been
estimated at ~ 30%
The following assumptions have been made,
1. Proportion of Population accessible through online surveys ~ 20%
2. Proportion of Population which is educated ~ 90%
Planned proportion estimate p = 0.3*0.2*0.9 = 0.054 0r 5.4%
For 95% confidence interval, z2 = 1.96
Therefore, n = (1.96)^2 * 0.054 * 0.946 / (0.05)^2
Sample Size = 79
Therefore, the Sample Size for our Survey is 79.

References
1. Abhishek and Sahay, Arvind (2013), Role of culture in celebrity
endorsement: Brand endorsement by celebrities in Indian context
2. Agrawal, J. and Kamakura, W.A. (1995), The economic worth of
celebrity endorsers: an event study analysis, Journal of Marketing, Vol.
59 No. 3
3. Das, Saumendra and Padhy, Prasant Kumar (2012), Brand perception by
celebrity endorsement, International Journal of Advanced Research in
Management and Social Sciences, Vol. 1, No. 2
4. Friedman, H. and Friedman, L. (1979), Endorser effectiveness by
product type, Journal of Advertising Research, Vol. 19, No. 5
5. McCutcheon, L. E., Ashe, D. D., Houran, J., and Maltby, J. (2003). A
cognitive profile of individuals who tend to worship celebrities. Journal
of Psychology,
6. McCracken, G. (1989), Who is the Celebrity Endorser? Cultural
Foundation of the Endorsement Process, Journal of Consumer
Research, Vol. 16, No. 9,
7. Pugazhenthi, A and Ravindran, D Sudharnani (2013), A Study on Impact
of Celebrity Endorsements on Consumer Purchase Intention in
Coimbatore City, India