Effect of endorsement advertisement on rural vs. urban youth buying behavior Essay

In today’s highly competitive markets, big brands are at logger-heads when it comes to products being offered, each having a similar product to that of a rival. Where does one brand gain that quintessential advantage – advertising, service, promise of trust, or even the all important price factors? Advertising seems to be the best platform where brands prefer to compete on – right from hiring the best advertising agencies to getting the biggest celebrities. Celebrity endorsement is a special type of advertisement which includes a famous person from film fraternity, athletes, and sports, modeling world etc. It helps in promoting the Brand and also increasing the sales of the product. Celebrity endorsement has not developed in recent years, it is being used since the days of Lux and Dabur Amla Hair Oil. This type of marketing strategy is used to promote the Brand and has proved in itself a boon in advertising world. However, it is very expensive to endorse a celebrity for a product but in the long run it has helped in enhancing the Brand Image. Celebrities are also interested in endorsing themselves as they get highly compensated and their visibility also increase. Infact several celebrities from bollywood use these advertisements for Promoting their new releases and also vice-versa. India is a country where people are star-struck by film stars, cricketers, politicians, and even criminals. Why? Population of 1 billion and ticking, everyday people need something or someone to look up to. A sense of security, admiration, comfort, familiarity, and above all, someone they aspire to be at some hidden level in their lives. And clever marketers leverage this very  celebrity appeal and are successfully carrying out their jobs by giving the bottom lines of all the brands what they want – profit, market share and even recall. But how much star power is too much? â€Å"Does Amitabh really use Boro Plus† And â€Å"Does Salman Khan really uses Wheel† asked a 6 year old to her mother. Her mother laughs and says, â€Å"No way, just a gimmick.† What does that do to the brand? Many companies have had considerable success using celebrities as spokesperson, both endorser image serve as mediators in the equity-creation process of celebrity product endorsement (Seno and Lukas, 2007). Product attitude was predicted by inferences about the endorser’s liking for the product and by attitudes towards the endorser (Silvera and Austad, 2004). When however respondents are exposed to negative information about a celebrity endorser, a negative transference of affect in the endorsement relationship may also occur. When the situation is reversed and the respondents are exposed to negative information about the brand, the transference of affect is mitigated (White et al., 2009). Businesses have long sought to distract the attention of the potentials customers that live in a world of ever increasing commercial bombardment. Everyday consumers are exposed to thousands of voices and images in magazines, newspaper, and on billboards, websites, radio and television. Every brand attempts to steal a fraction of an unsuspecting person’s time to inform him or her of the amazing and different attributes of the product at hand. Because of the constant media saturation that most people experience daily, they eventually become numb to the standard marketing techniques. The challenge of the marketer is to hook the subject’s attention. 3 This is true for the classic forms of celebrity, like Film Stars (eg. Amitabh Bachchan, Shahrukh Khan, Rani Mukherjee, Aamir Khan and Pierce Brosnan). Models (e.g., Malaika Arora, Lisa Ray , Naomi Campbell, Gisele Buendchen etc)., Sports Figures (e.g., Sachin Tendulkar, Mahendra Singh Dhoni, Virander Sehwag, Rahul Dravid, Zaheer Khan , Steve Waugh, etc). Entertainers (e.g. Cyrus Broacha, Oprah winfrey, Conan O’Brien), and Pop-Stars (e.g., Madonna, David Bowie) – but also for less obvious groups like Businessmen (e.g., Donald Trump, Bill Gates) or politicians. Celebrities appear in public in different ways. First, they appear in public when fulfilling their profession, e.g., Viswanathan Anand, who plays chess in front of the audience. Further, celebrities appear in public by attending special celebrity events, e.g., award ceremonies, inauguration or world premier of movies. In addition, they present themselves in news, fashion, magazines, and tabloids’, which provide second information on events and the ‘private life ‘of celebrities through mass-media channel (e.g., Smriti Irani being regular feature in various publications). Last but not the least, celebrities act as spokes-person in advertising to promote products and services, which is referred to celebrity endorsement. For Instance: ï‚ · Vodafone signed Irfan Khan for advertisement of Sim cards. ï‚ · Tennis sensation Sania Mirza was appointed to increase the sales of ‘Bournvita energy drinks’. ï‚ · ‘ITC’ roped in Deepika Padukone for promotion of its soap named ‘Fiama di Wills’. ï‚ · Famous Brand ‘Veet’ roped in Katrina Kaif as its Brand ambassador. ï‚ · Shahrukh Khan has been chosen by Big Brands for their Advertisement which includes ‘Dish TV’ and ‘Airtel’. ï‚ · M.S Dhoni and Baichung Bhutia for ‘Project Tiger of Aircel’. Companies spend huge amount of money on Celebrities to sell anything from a candy, hair oil, soaps, colas, pens, paints, automobiles etc. Most companies know that celebrities have an appeal and a Brand can be best helped to reach out to the masses. 4 2.0 REVIEW OF LITERATURE The use of testimonials by advertisers dates back to the 19th century when medicines were patented. Firms have been juxtaposing their brands and themselves with celebrity endorsers (e.g., athletes, actors) in the hope that celebrities may boost effectiveness of their marketing. The late ’80s saw the beginning of celebrity endorsements in advertising in India. Hindi film and TV stars as well as sportspersons began encroaching on a territory  that was, until then, the exclusive domain of models. There was a spurt of advertising, featuring stars like Tabassum (Prestige pressure cookers), Jalal Agha (Pan Parag), Kapil Dev (Palmolive Shaving Cream) and Sunil Gavaskar (Dinesh Suitings). Of course, probably the first ad to cash in on star power in a strategic, long-term, mission statement kind of way was for Lux soap always endorsing the latest hit actress. A brand which has, perhaps as a result of this, been among the top three in the country for much of its lifetime. Today, the use of celebrity advertising has become a trend and a winning formula of corporate image building and product marketing. It provides empirical evidence demonstrating that attitudes can be affected in such a way. The impact of Tiger Woods tournament performance on the endorsing firm’s value subsequent to the contract signing was examined. No relationship was found between Tiger’s tournament placement and the excess returns of Fortune brands. No significant relationship was found for American Express, suggesting the market does not view a golfer endorsing financial services as credible. However, a positive relationship and significant impact of tiger’s performance on Nike’s excess returns was found suggesting that the market values the additional publicity that Nike receives when Tiger is in contention to win (Farrell et al., 2000). Some marketers choose to utilize multiple celebrities to promote their Brands. Fit between the endorsed product and various celebrities is a key factor for using multiple celebrity endorser in advertising (Hsu et al., 2002). The use of celebrity endorser in advertising is wide spread – as much as 20 percent of all advertising use some type of celebrity endorser. Marketers invest significance dollars in securing the promotional support of well-known individuals (Till, 1998). Products which are ultimately sold by retailers are endorsed more frequently by celebrities in certain sports than others (Lear et al., 2009). The importance of fit between the endorser and the endorsed product has been described as the â€Å"Match-up Hypothesis†, research has focused on physical attraction (Till and Busler 1998). Celebrities can be used to gain attention and maintain sales, while spokesperson’s effectiveness is in establishing a lifelong link with the product (Tom et al., 1992). 5 The perusal of above mentioned studies makes it very clear that endorsements advertisement does have strong impacts on consumers. The present paper has taken a leaf from these studies and has proceeded for an empirical investigation, into a Region-Wise Impact of Celebrity Endorsement which is presented subsequently. 3.0 RESEARCH METHODOLOGY Research problems tend to be different from one another and so it requires own special emphasis and different approach. Since the entire research problem is unique in some ways, the research process has to be typically customized. All the steps adopted in the research have been elaborated in the following sections. 3.1 Statement of the problem The present paper aims at finding the extent to which endorsement advertising has been successful to influence the buyer behaviour across Urban and Rural groups. The research problem investigated herein has been precisely defined asâ€Å"Effectiveness of Endorsement Advertisement on Rural vs. Urban Youth buying behaviour†. 3.2 Objectives 1. To study the likeability of the endorsement advertising. 2. To study as to what extent endorsement advertising impact the consumer behaviour towards endorsed Brands. 3. To comparatively study the Impact of endorsement advertisement on Rural vs. Urban Buyer Behaviour. 3.3 Hypothesis In order to ensure effective analysis and understanding of data collected for the purpose of this study, the following hypothesis have been framed: 1 H0: There is no specific impact of celebrity endorsements in Advertising on Youth. 2 H1: There is no significant difference between Urban and Rural Youth with respect to effectiveness of endorsement in advertising. 3.4 Research Design The present research is descriptive in nature as it aims at comparatively studying whether endorsement advertising has an impact on Youth buyer behaviour. It also aims to find out as to what type of consumers in terms of locality is more 6 influenced by endorsements. Information has been collected from the respondent with the help of a structured questionnaire. The universe of the study is the state of Haryana covering both cities and small villages. Since it was not feasible to study the entire region, the researcher drew a sample. 3.5 Sampling Design and Sampling Technique Nine hundred eighty questionnaires were administered. Fifty questionnaires were found to be incomplete and hence were excluded in the final data. Therefore, data from nine hundred thirty respondents have been collected and analyzed. Due care has been taken to ensure that enough number of Urban and Rural respondents be included in the sample. 3.6 Data Collection Method In the present study, Structured Questionnaire method has been used to collect the data. In some case, particularly in case of semi-literate/illiterate respondents, personal interview technique was used to draw out information as per the questionnaire. 3.7 Scaling of Items A five point Likert’s scale from â€Å"Strongly Agree† to â€Å"Strongly Disagree† was used to measure the response to each statement (Items). 3.8 Tools of Data Analysis The data collected have been duly tabulated and classified. Thereafter it has been analyzed with the help of simple percentage technique to describe the present status of respondents. Chi-square test has been used by the researcher to study the association between various variables as well as to study the association between quantitative and qualitative variables. 7 Table 1.1 PROFILE OF RESPONDENTS Sr.No Percent N Percent 243 41.39 126 36.73 369 39.67 20-24 184 31.34 116 33.81 300 32.25 24-28 2) N 16-20 1) Profile of Respondents Age (in yrs) Urban (587) 160 27.25 101 29.44 261 28.06 Location Rural (343) Urban Total (930) Percent Rural N % N % 587 63.11 343 36.89 Percent 3) Occupation N Percent N 197 141 144 105 33.56 24.02 24.53 17.88 99 78 88 78 4) Students Self-Employed Business Housewife Gender N % 56.98 N Percent 28.86 296 22.74 219 21.28 229 16.90 183 Female Male 530 N N 400 % 43.02 INTERPRETATION: 1) The Profile of respondents as depicted in Table 1.1 shows that majority of them i.e. 243 respondents almost 42% fall in the category of age bracket of 16 to 20 years. 2) As the study was done to take the opinion of both Urban and Rural audience the data collected revealed 587 (63.11 %) respondents from urban areas as compared to 343 (36.89%) respondents from rural areas and suburb have been studied. 3) Majority of the respondents who were a part of this survey constituted of students (31.82%), followed by Businessman (24.62%) and Self-employed (23.54%). 4) Due importance was given to take response from both male and female respondents and hence 400 (43.02%) females participated in this survey as against 530 (65.98%) males. 8 31.82 23.54 24.62 19.67 ANALYSIS [S =Sample Standard Deviation] XU = 29.91 XR = 28.34 nU = 587 SU = 8.49 SR = 7.82 nR = 343 HÐ ¾:  µ1 =  µ2 (i.e. there is no significant difference between Urban & Rural with respect to effectiveness of endorsement in advertising) H1:  µ1 =  µ2 (Two tail test) USING Z – TEST At 5% level of significance, the critical value of Z = 1.96 for two tail test. Since calculated value is greater than critical value (Table-value) of Z, we reject HÐ ¾ in favour of H1 and conclude that there is a significant difference between Urban & Rural with respect to effectiveness of endorsement in advertising. 9 Table 1.2 Distribution of Respondents as Regards Attitude Indicators Sr. Indicators Strongly Agree Agree Neutral Disagree Strongly No. Disagree Urban 2) 3) 4) 5) 6) 7) 8) Celebrity Advertisement is more noticeable. Celebrity Advertisement have high recall rate. Celebrity Advertisement positively motivates audience for product purchase. Audience enjoys watching Celebrity Advertisement. Audience have positive attitude towards product having Celebrity Advertisement. Celebrity Advertisement are remembered for a long time. Use of Celebrity Advertisement enhances the credibility of Brands. Celebrity Advertisement is used when brand performance is poor. 10 Urban Rural N % 1) Rural Urban Rural N N % N % % N % N % 214 23.0 170 18.2 97 10.4 48 N Rural % N % Rural N % N % 5.1 88 46 4.9 101 10.8 31 4.3 143 15.3 100 10.7 117 12.5 62 6.67 103 11.0 49 5.2 123 10.2 67 7.2 101 10.8 65 6.9 147 15.8 103 11.0 123 13.2 102 10.9 114 12.2 34 3.6 100 9.7 8.8 54 6.3 5.91 110 11.8 70 7.5 112 12.0 70 7.5 140 15.05 103 11.0 114 12.2 102 10.9 118 12.6 34 3.6 108 11.6 50 5.3 107 11.5 54 5.8 165 17.74 111 11.9 139 14.9 101 10.8 100 10.7 50 5.37 95 10.2 40 4.30 88 9.4 41 4.4 147 15.8 7.4 120 12.9 70 7.52 120 12.9 84 9.03 100 10.7 60 6.4 100 10.7 60 6.4 120 12.90 100 10.7 140 15.0 76 8.17 128 13.7 51 5.48 104 11.1 61 6.5 105 11.2 55 5.9 69 4.3 85 9.13 55 9.4 Urban 9.3 48 180 19.35 108 11.6 100 10.7 40 5.1 87 Urban 50 6.4 103 9) 10) 11) 12) 13) Celebrity Advertisement ignores product quality/feature. Customers only remember celebrities & not brands in Advertising. Use of Celebrity in advertisement increase the cost of brand sold in market. Poorly performing celebrity affects the brand perception negatively. Social ideas may be promoted well by celebrities. 11 154 16.5 91 9.7 100 10.7 65 6.9 118 12.6 77 8.2 110 11.8 55 5.9 105 11.2 55 5.9 150 16.2 135 14.5 126 13.5 94 10.1 120 12.9 50 5.37 95 10.2 25 2.6 96 10.3 39 4.1 200 21.5 115 12.3 145 15.5 80 8.06 90 9.6 40 4.3 77 8.2 43 4.62 75 8.06 65 6.9 194 20.8 103 11.0 131 14.0 76 8.17 102 10.9 69 7.41 95 10.2 35 3.7 65 6.9 60 6.4 146 15.6 109 11.7 132 14.1 104 11.1 133 14.3 57 6.13 91 9.7 33 3.5 85 9.13 40 4.3 ANALYSIS & INTERPRETATION: 1) According to the analysis Shown in the table 1.2 it was found that majority 529 (56.88%) of the respondents including 311 (33.44%) from Urban segment and 218 (23.44%) from Rural segment were in the favor of this statement and hence it was proved that celebrity advertisement is more noticeable. 2) Analysis of Second indicator shows that majority of the respondents 422 (45.37%) including 260 (27.95%) from Urban segment and 162 (17.41%) from Rural segment believe that celebrity advertisement do have high recall rate. 3) As can be analyzed in table 1.2 it is seen that 475 (51.07%) respondents including 270 (29.03%) from Urban segment and 205 (22.04%) from Rural segment strongly feel that if the product is being endorsed by any celebrity it motivates the audience for purchasing that product. 4) Analysis shows that 428 (46.02%) respondents including 280 (30.10%) from Urban segment and 148 (15.91%) from Rural segment enjoys watching celebrity advertisement as it is evident from the above interpretation. 5) However, it was also seen that a total of 459 (49.35%) respondents which included 254 (27.31%) from Urban Segment and 205 (22.04%) from Rural segment do have positive attitude towards product having celebrity advertisement and they enjoyed watching such advertisements. 6) Study revealed this fact that majority 516 (55.48%) of respondents including 304 (32.68%) From Urban Segment and 212 (22.79%) from Rural segment felt that celebrity advertisements are remembered for a long time as they have a strong appeal in the minds of consumers and consumers correlate the products by their favourite celebrity. 7) According to the study conducted it was found 406 (43.65%) respondents including 267 (28.70%) from Urban segment and 139(14.94%) from Rural segment believe that generally celebrity advertisements enhance the credibility of the brands. 12 8) Analysis revealed that 436 (46.88%) respondents including 260 (27.95%) from Urban segment and 176 (18.92%) from Rural segment felt that companies generally used celebrity advertisements when their brands performance is poor and it is difficult for them to sustain their brand in the market. 9) It was evident from the study that 410 (44.08%) respondents including 254 (27.31%) from Urban segment and 156 (16.77%) from Rural Segment felt that that Celebrity Advertisement ignores product quality or any kind of features in it. 10) Accordingly it was found that 505 (54.30%) customers including 276 (29.67%) from Urban segment and 229 (24.62%) from Rural segment only remember the celebrity in that advertisement and somehow tends to forget the brand this shows the power of Celebrities which generally overshadows the Brand. 11) According to the study conducted it was found that majority of the respondents 540 (58.06%) including 345 (37.09%) from Urban segment and 195 (20.96%) from Rural segment felt that if a celebrity is used to advertise a product it however means that it will increase the cost of brand in the market. 12) However with reference to the study conducted majority of the respondents 504 (54.19%) including 325 (34.94%) from Urban segment and 179 (19.24%) from Rural segment felt that a poor performing celebrity does affect the brand perception negatively even if it is their favorite actor, actress or cricketer. 13) According to the study conducted majority of the respondents 491(52.73%) including 278 (29.89%) from Urban segment and 213 (22.90%) from Rural segment felt that the celebrities are perfect alibi when it comes to promoting social ideas. N.B- All the figures mentioned in the above Analysis & Interpretation is the accumulation of Strongly Agree and Agree Variables. 13 Table 1.3 TABLE OF INTERPRETATION Level of Significance – .05 ATTITUDE INDICATORS 1) Celebrity Advertisement is more noticeable. 2) Celebrity Advertisement have high recall rate. 3) Celebrity Advertisement positively motivates audience for product purchase. 4) Audience enjoys watching Celebrity Advertisement. 5) Audience have positive attitude towards product having Celebrity Advertisement. 6) Celebrity Advertisements are remembered for a long time. 7) Use of Celebrity Advertisement enhances the credibility of Brands. 8) Celebrity Advertisement is used when brand performance is poor. 9) Celebrity Advertisement ignores product quality/feature. 10) Customers only remember celebrities & not brands in Advertising. 11) Use of Celebrity in advertisement increase the cost of brand sold in market. 12) Poorly performing celebrity affects the brand perception negatively. 13) Social ideas may be promoted well by celebrities. 14 CHI-SQUARE VALUE 20.54 Hypothesis Accepted 4.28303 Accepted 22.4396 Accepted 5.05116 Accepted 29.466 Accepted 9.402 Accepted 3.9368 Accepted 64.66 Accepted 2.349 Accepted 37.745 Accepted 8 Accepted 13.67623 Accepted 19.764 Accepted DECLARATION This is to certify that the paper is the original work of the authors and has not been submitted elsewhere. For any violation of the copyrights, the author shall bear the sole responsibility. 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