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TRANSCRIPT
Assignment Code: 9459
Date of Completion: 29 May 2012
Words: 20000
Title: Influence of celebrity brand endorsement on buying behavior of the Indian soft drink
consumers
Influence of celebrity brand endorsement on buying behavior of
the indian soft drink consumers
ACKNOWLEDGMENT I am highly grateful for the help and support provided to me for the duration of the
completion of my dissertation. I would like to first thank my instructor, who provided me this
opportunity to conduct dissertation and guided me at every step of the dissertation.
Additionally I also want to thank my team members who helped me in the collection and
analysis of data, for research in order to have relevant results for the dissertation.
TABLE OF CONTENTS Acknowledgement……………………………………………………………………………...i
List of figures and tables………………………………………………………………………ii
CHAPTER 1 INTRODUCTION.............................................................................................................1
1.1 Introduction..............................................................................................................................1
1.2. Research Aim...........................................................................................................................3
1.3 Research questions...................................................................................................................4
1.4 Research Objectives.................................................................................................................4
1.5 Research Methodology............................................................................................................5
1.6 Contribution of the Study........................................................................................................5
1.7 Structure of the Dissertation....................................................................................................6
CHAPTER 2: LITERATURE REVIEW.................................................................................................7
2.1. Who is a Celebrity?..................................................................................................................7
2.2. Concept of Celebrity Endorsement..........................................................................................8
2.3 Reasons for using celebrity endorsers...................................................................................11
2.4 Threats of celebrity endorsement...........................................................................................12
2.4.1 Pros and Cons of celebrity brand endorsement.............................................................14
2.5 Selecting of celebrity endorsers.............................................................................................15
2.6 Brand Celebrity Endorsement................................................................................................16
2.7 Consumer Buying behavior...................................................................................................18
2.7.1 Consumer Buying Process.............................................................................................18
2.7.2 Types of Consumer Buying Behavior...........................................................................19
2.8 Impact of Celebrity Endorsement on buying behavior of the consumer...............................20
2.9 Indian Soft Drink Industry....................................................................................................22
2.9.1 Industry overview..........................................................................................................24
2.10 Conclusion............................................................................................................................26
CHAPTER 3: METHODOLOGY.........................................................................................................28
3.1 Research Methods..................................................................................................................29
3.2 Research Motives...................................................................................................................31
3.3 The Population.......................................................................................................................31
3.4 The Sample............................................................................................................................31
3.5 Tools for Data collection.......................................................................................................32
3.6 Data collection.......................................................................................................................32
3.7 Validity and Reliability..........................................................................................................33
3.9 Limitations.............................................................................................................................34
3.10 Celebrity Endorsement Strategy: Case of Coca Cola India...................................................34
CHAPTER 4: DATA ANALYSIS AND FINDINGS...........................................................................40
4.1 Data Analysis.........................................................................................................................41
4.2 Findings.................................................................................................................................52
CHAPTER 5: DISCUSSION OF FINDINGS.......................................................................................55
Conclusion.........................................................................................................................................58
CHAPTER 6: RECOMMENDATIONS AND LIMITATIONS...........................................................59
APPENDIX A........................................................................................................................................66
LIST OF TABLES AND FIGURES
Figure 1 Buying process. 18
Figure 2 Demand of Aerated Sort Drink over time. 24
Figure 3 Market Share 25
Figure 4 Market Growth over time 25
Figure 5 Geographic Distribution of the market 25
Figure 6 Category-Wise Off-Trade Sales of Carbonated Drinks In India Between 2005-10 (In
Rs. Million) 26
Figure 7 Spending for Celebrity Endorsement by Coca-Cola India. 39
Table 1 Pros and cons of celebrity endorsement. 14
Table 2 Category-Wise Off-Trade Sales of Carbonated Drinks In India Between 2005-10 (In
Rs. Million) 25
Table 3 Different brands of Coca cola and their marketing USP. 35
CHAPTER 1 INTRODUCTION 1.1 Introduction
It is a routine for us to encounter with number of commercials endowed with well
known persons, in either electronic media or paper media. Such commercials, endowed with
famous personalities, are the part and parcel of company’s promotion mix strategies. This
concept, in general, is known as Celebrity endorsement. Believing that celebrities are the
effective spokespersons for the company, marketing persons spend enormous fund for such
contracts (Katyal, 2007). Celebrity choice for endorsement is very critical by nature, as it
involves significant fund along with the reputation of the firm. Choice of celebrity is done
based on two parameters. One of these is ‘compatibility index’ and another is ‘trait fit index’.
By compatibility index, we mean the match between the celebrity and the brand. Whereas the
trait fit index is defined as conformity of brand personality traits to the celebrity personality
traits (Sengupta, 2005).
A radical increase in the use of celebrity endorsement as a tool for advertising strategy
has been noticed in the last few years. Celebrities were used to promote almost every kind of
products or services, let it be sports to beverages or beauty to luxury. This drastic increase of
celebrity endorsers is just not limited to any specific sector of the economy. Companies use
celebrity endorsement for all industry categories inclusive of packaged goods, automobile
industries telecommunication and financial services (Okorie, 2010; Okorie & Aderogba,
2011). According to the study of White (2000), in the US, 25% advertisements in paper
media employ the use of endorsers. As a result, The hypothesis that celebrity endorsement
positively affect the consumers’ attitudes and buying behaviors, is accepted by many US
firms (Okorie & Aderogba, 2011).The motive behind the celebrity endorsement in the brand
communication strategies is just not to increase income, but is to add value to a company,
brand or product. Celebrity endorsement strategy is more likely to be pragmatic for those
products, which are having a high price-production cost margin with a larger customer base
(Amos, Holmes & Strutton, 2008). Or in general, the celebrity endorsements are the
characteristic for nationally marketed products rather than for local or niche market products.
The conglomerates tend to invest enormous amounts of money for matching its products and
the celebrity believing that this is going to catch the attention towards the endorsed products
or services and assist in transferring the image to products or services in the course of the
fame of a celebrity (Meenaghan and O‟Mahony, 1998).
[1]
A huge range of publically recognized celebrities are used by food advertisers to
endorse or act as spokespersons for a product and also to recommend it to the public. After
1920, the relationship between celebrities and their audiences came to the notice of the
advertisers. Popular entertainers and the movie stars were the early endorsers. This list later
on extended to embrace TV stars and persons from specific occupations like politics, sports,
arts, and business etc.
By an endorsement, an endorsing icon makes the product much recognizable to the
target public. This can be made by a number of ways. Like:
Explicitly: Here the endorser directly made declaration for endorsing the product.
Implicitly: Here endorsement is done by implying the use of product by the
endorser.
Imperatively: Here the endorser suggests the use of the product.
Co-presently: Here the endorsement is done by endorsers’ presence with the product.
Celebrities are selected to stand for values, which are embodied in the endorsed
product. Bill Cosby, the comedian, endorsed the soft drink Coca-Cola. Though there exist a
close association between the star and the product yet use of celebrity endorsement does not
guarantee the increase in product sales. John Houseman, was not successful as an endorser
for McDonald's but fared well in other endorsement campaigns. An endorsement fails when
actually they fail to transfer meaning.
In Indian advertising industry, the first celebrity endorsement ad was carried by LUX,
the star bathing soap. Subsequently, it came into the trend of attaching celebrity credibility to
the products through an endorsement stunt (Belch et al, 2009). Today strategic positioning
along with effective communication has become the formula for the success in this
competitive market. Both the above objectives can be achieved through endorsement
strategy. Shifting our discussion to the Indian markets, this concept of celebrity endorsement
has become so popular among the marketing person that, for an ad of Eclaires toffee, which
cost one rupee to the consumer, Kareena Kapoor is approached for the advertising campaign.
Celebrity endorsement gives a touch of glamour to the brand (Reynolds, 2000). Celebrity
endorsement is a billion dollar industry today worldwide (Kambitsis et al, 2002).
In India, bollywood stars, such as cricketers, players, singers, athletes etc. have a huge
fan following. This fact provides all these famous personalities the celebrity status.
According to a research paper, bollywood viewers counts to be 3.6 billion worldwide which
[2]
is quite high from the viewership of the Hollywood, which is 2.6 billion in numbers. This
statement strengthens the success of celebrity endorsement strategy in Indian markets.
The Soft-Drink Industry of India amounts to be 3500 crore rupees, comprising of
consumer’s right through the country, and of all age groups. Major players of the industry are
Coca-cola India Pvt. Ltd., Dabur foods Ltd., Parle Agro Ltd., Parle Bisleri Ltd., Pepsico India
Holdings Ltd., Pioma industries Ltd., Mount Everest Mineral waters Ltd., Navarangs
Hospitality Service Pvt. Ltd. etc. PepsiCo India entered the Indian Soft Drink industry in 1989 and
became a leading name within a few years. Their popular products are Slice, Pepsi,
Nimbooz, Mountain Dew, Mirinda and 7UP.
Coca-Cola India and PepsiCo India are the two popular giants in the Indian Soft Drink
market. Launched in 1993, Coca-Cola India is a leading soft drink producer in India which
has more than 1.3 million retailers and more than 7000 distributors in India. Thums up,
Limca, Fanta and Coca-Cola are some of their popular brands. With the rising growth of soft
drink industry, both the manufacturers adopt strategies to expand their sales through
advertisements.
Very first, Babe Ruth, the great baseball player endorsed Red Rock Cola soft drink
brand in the late 1930’s and since then companies all over the world inclined towards
celebrity’s endorsement for their products as an integral part of the promotional campaigns.
Sports icons and film stars were being associated with soft drinks for their promotion. E.g.
Akshay Kumar is associated with Thumbs Up brand, Shahrukh is being associated with coca
cola also Ranbir Kapoor for promoting Pepsi. This kind of endorsement campaigns helps the
corporate to reap quantity profits.
1.2. Research Aim
Although the concept of celebrity endorsement and Indian soft drink industry is
heavily documented in the academic literature, but what makes out study different and
interesting is its relevance to the consumer buying behavior. Its area of study makes it
particular and more consistent as covers the Indian soft drink industry. Not much research has
been laid down for this topic. Although the Indian soft drink industry has been the point of
discussion for celebrity endorsement strategy among the marketers and the media.
Indian market scenario is going through a change phase because of the presence of
high competition and spread of awareness among the Indian consumers. Think of the ads in
1990 or earlier, these were just informative but it’s not the scene with the today’s ads. These
[3]
days ads are more innovative and consumer involvement has become a must trick of success.
Consider washing powders market in India. Earlier completion was not that much stringent
only a few players like Nirma, Ghadi etc were there. Presence of MNC’s like P&G, Uniliver
etc has changed the game. Consumer attitude is changing with a rapid pace, making them
much aware of the products. Research has been carried out for studying the impact of
celebrity endorsement on the buying behavior of the Indian soft drink consumer and their
response to the celebrity endorsement ads. For example, people feel much motivated for
buying a Nakshatra brand diamond endorsed by Ashwarya Ray rather than buying a
traditional gold jewelry.
Majority of soft drink ads in India are targeted towards the youngsters. This makes the
importance of young celebrities to be included in the ads. For an billion dollar industry,
finding out the role and importance of celebrity endorsement, particularly for the context of
Indian soft drink industry, has its own significance. Here in this study, our point of discussion
will be on Indian soft drink industry and celebrity endorsement, its impact on the consumer
buying behavior. Coca-cola India, as its marketing strategies and inclusion of endorsement
strategy in the marketing plan, is spending enormous amount on endorsement contracts. In
the past few years in India, as the demand for the top celebrities shot through the top, their
charges too looked skywards. On an average top stars charge anywhere between Rs 1–1 .5Cr.
a day and according to the industry executives even during the economic slowdown, the rates
didn't come down but kept growing even though at a slower speed (Economic Times, 2010).
1.3 Research questions
The research will be carried out answering the following questions:
1. How does the celebrity endorsement influence the Indian soft drink consumers’
buying behavior?
2. How much important is the celebrity endorsement in Indian soft drink industry?
3. How much an endorsement cost to the firm?
1.4 Research Objectives
This research is structured for attaining three research objectives. First objective is
to measure the impact of celebrity endorsement on the consumer buying behavior for
Indian markets. The second objective is to mould the impact study of celebrity
endorsement for Coca-Cola India. Last but certainly not the least objective is to have an
idea of the costing side of the endorsement strategy. Objective statement is as follows:
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To establish relationship between celebrity endorsements in advertisement and
buying behavior of Indian consumers.
To evaluate the effectiveness and impact of celebrity endorsed advertisements
for Coca-Cola.
To analyze the spending trends of company on celebrity endorsement.
1.5 Research Methodology
This is a qualitative research. Here for the fulfillment of the research objectives two
types of research methods are used for analyzing both primary data and the secondary data.
Primary data are collected through questionnaires. The population for the study is India.
100 responses are collected through these questionnaires and further these responses are
analyzed using quantitative research tools, i.e. charts, graphs, tables, excel formulae etc.
this sample of 100 respondents are a random sample. Questionnaire is filled through an
encounter method. Under this the first 100 persons encountering at a key place are asked to
fill the questionnaire. This key place can be a mall, restaurant, college, etc. where the soft
drink consumers can be approached with least efforts.
The secondary data are availed from the company sources. An exploratory study
method is applied for analyzing these secondary data. From the secondary data a spending
trend are drawn against the monetary or nonmonetary benefits derived. After collection of
data, data analysis techniques are used as per the requirements of the data. On the basis of
data analysis results are derived or authenticated.
Finally, results of both the methods are combined to test the hypothesis and derive
answers to the research questions.
1.6 Contribution of the Study
First and foremost, this research aims to analyze the buying behaviors of the Indian
soft drink Consumers and next, the Study attempts to incorporate facts of Indian consumer
attitudes with regard to the celebrity endorsed advertisements of Coca Cola. It tries to
investigate appreciation of celebrities among the consumer and their attempt to emulate them.
Further the study tend to analyze the spending trend of soft drink leader coca-cola. This cost
aspect will also be analyzed and evaluated on the ground of benefits derived. Earlier, many
scholars have done research on this front but, in this study, the area of analysis is conical as
we are taking into consideration only Coca-cola India. This makes the view much clear and
concise.[5]
The undertaken research on the celebrity endorsement and its impact on consumer
buying behavior is of much use from the academic as well as professional perspective. As it
analyzes the behavior of consumers, it will provide theoretical base for scholars and practical
directives to the managers and professionals.
1.7 Structure of the Dissertation
This dissertation is segregated into six chapters to follow the proper research process,
named as Introduction, Literature Review, Research Methodology, Findings and data
analysis, Discussion and interpretation of findings and finally Conclusion, implications and
recommendations.
Chapter one is of introductory chapter. This chapter will acquaint the reader with the
ground of the study. Here the research aims, objectives methods etc. are disclosed. Beginning
of the chapter sketches the pertaining scenario of the Indian soft drink industry and celebrity
endorsement. Later, the process of the research, its significance and importance are stated.
The second chapter deals with the literature review. This chapter provides details
about the previous studies on the concerning topic. Also define the key terms and provide
theories required for the completion of the study. This chapter is concluded giving ground to
the research.
Research tools and methods used for deriving the objectives of the study are defined
here. Complete illustration of the process from data collection to the final data analysis and
interpretation is described in this section. Techniques of sampling, sample size, data analysis
tools are also given here. It continues with a description of the two research methods and
justify the adoption of particular quantitative technique.
Data analysis and findings chapter is numbered four. Here at the initial stage, primary
data collected from survey through questionnaire is discussed and analyzed. Also definition
of variables used and the survey techniques is given in the early section of the chapter. In this
analysis is done using charts and tables for each instance observed from the questionnaire.
Chapter is concluded with hypothesis testing and objective derivation.
In the fifth section of the dissertation a detailed discussion of findings is done.
Through the discussion, research interpretations are done. These interpretations are further
generalized so that results can be implemented for the universe at large.
In the end, all findings of the study are summarized along with the limitations of the
study. Finally giving ground to the further research opportunities, dissertation ends.
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CHAPTER 2: LITERATURE REVIEW Intention of a literature review is to provide a snap shot of already carried out studies
in the concerned subject along with defining the key terminology of the subject, so that a
clear picture of the study can be drawn. Here in this section of the dissertation, we will try to
explore the existing theories and scholarly work done previously under the similar headings.
A step by step procedure will be here, starting with defining the celebrity concept and Brand
endorsement mechanism. Further, we will have an in-depth look in the consumer buying
behavior theory and related processes. Afterwards, we will analyze the Indian soft drink
industry. Specifically our point of concern will be on Coca-Cola India.
In accordance with the proposed content of the Literature review, this section is
divided into four subsections, such as who is a celebrity, concept of Brand endorsement,
consumer buying behavior and finally the Indian soft drink industry and celebrity
endorsement: Case of Coca-Cola India.
2.1. Who is a Celebrity?
Dictionary meaning of Celebrity word is “a famous person". Celebrity, also known as
a celeb in day to day conversation, is one who is well known among the mass for his/her
extra ordinary qualities, work, belongings or associations. These persons hold an outstanding
profile along with immense public absorption. They influence the day-to-day media. Their
distinction in a particular ground is easily acknowledged by the general public. These
grounds of distinction can be professional or personal attributes of individuals (Turner, 2010).
A celebrity status can be associated with many careers within the fields of sports,
entertainment or social work. From sports arena, basketball player Michael Jordan,
golfer Tiger Woods, hockey player Wayne Gretzky, former boxer Muhammad Ali, Cricketer
Sachin Tendulkar, football player Brady and, Tennis star Saniya Mirza, Rofal Nadal and
many more, all are well known and enjoyed a celebrity status backed by their eminent
performance in their respective fields. Shifting the concern towards the entertainment
industry, many famous personalities like Aishwarya Rai Bachchan, Amitabh Bachchan,
Shahrukh Khan etc. from the film industry, authors like Arundhati Roy, Chetan Bhagat,
Salman Rushdi etc., entertainers like Shekhar Suman, Navjoth Singh Sidhu etc. are also well
verse and enjoying a celebrity status.
"A sign of a celebrity is that his name is often worth more than his services.”
[7]
- Daniel J Boorstin
Being a celebrity is the state of widely acclaimed and honoured. Celebrities enjoy public
recognition due to their work or profession. Attributes like extraordinary lifestyle, attractiveness
are just examples and some of the common characteristics of celebrities (Schlecht, 2003).
While some of the people may have gained celebrity status due to their successful
career in a particular field (specifically in the areas of sports and entertainment), whereas in
other cases, people enjoy celebrity status by grabbing attention of media backed by their
overgenerous lifestyle or wealth (Just like Vijay Maliya); for being associated to famous
personalities (as may be the case for Gauri Khan wife of Shahrukh Khan) or some may be for
their misdeeds (like Rahul Mahajan). The Celebrities may be popular around the world or
within a country.
Anyone who has achieved excellence in his/ her field (specifically in entertainment or
sports industry) is regarded as a person with something "extra" provided by that "God". He
starts getting extra attention by the rest of the world and is looked on as a great figure. People
start celebrating all his acts producing success. He would be given special treatment and
noticed everywhere. The field may be sports, film, theatre, social life, politics, and science
etc. but something incredible. That’s how a celebrity status comes (Inglis, 2010).
Some celebrities of India are as under -
a. Bollywood celebrities – Amitabh Bachchan, Preity Zinta, Shahrukh Khan, Aamir
Khan and Pierce Brosnan, Aishwarya Rai etc.
b. Television figures – Husain, Smriti Irani, Shweta Tiwari etc.
c. Sports hero – Sachin Tendulkar, Sania Mirza, Vishwanath Anand etc.
d. Entertainers – Shekhar Suman, Cyrus Broacha etc.
e. Singers – A.R. Rehman, Lata Mangeshkar etc.
Lastly, the celebrities act as spokes persons, in advertising to endorse products and
services (Kambitsis et al, 2002, Tom et.al., 1992) a company spokesperson is the celebrity
who represents any brand or company over a significant period, whether in electronic media
or paper media along with personal appearances (Schiffman and Kanuk, 1997).
2.2. Concept of Celebrity Endorsement
According to McCracken (1989), celebrity endorsement is a universal attribute of
modern marketing. Companies invest considerable amounts of money to ally themselves
along with their products to the big names of the celebrities. This step is taken with a belief
[8]
that they will seek attention for the endorsed products/services and also transfer image values
to these products/services by desirable quality of their profiles and delightful attributes
(Erdogan1999; Ohanian, 1991; O’Mahony and Meenaghan, 1998). Furthermore, according to
Newsom et al (2000), celebrities are capable of increasing recognition and their charisma
more or less guarantees publicity. Findings of the study conducted by Mathuret et al. (1997)
and Agrawal and Kamakura (1995) advocate the efficacy of use of celebrity endorsement
strategy. Because of their recognition, stars help not only to create and maintain attention, but
also attain high recall rates of advertisement messages (Atkin and Block, 1983; O’Mahony
and Meenaghan, 1997; Friedman and Friedman, 1979; Kamen, et al. 1975; Erdogan, 1999;
Kamins, et al. 1989; Ohanian, 1991). Moreover, Dyer (1988) opines that the use of a celebrity
is the most successful way of securing attention of the consumer and getting him or her to
surmise the right message with a limited space and time. Existing literature implies that,
celebrity endorsement cost in millions for each year (Buck 1993; Erdogan 1999; Tripp et al.
1994; Walker et al. 1992). Shimp (2000) confers from his study that approximately 25% of
all commercials in US, utilize celebrities whereas according to Kamins (1990), today
advertising by celebrity endorsement approach emerges to be on the increase across all media
types.
Research shows while making a brand choice for buying product consumers, they are
actually creating lifestyle statements because they are buying not only an image but also an
emotional rapport (Urde 1999; Williams 2002). Chernatony (1993: 178) says, consumers
have their own ‘brand wardrobes’ from where they make selections. This is to communicate,
reflect or reinforce associations, statements and memberships. According to the Clarke
(2000) recommendations, style and status indicators can present the same consumer
reimbursement which the other highly branded lifestyle accessories such as cars, perfumes,
watch and clothes. That is why, Schiffman and Kanuk (2004) advocate that strategic brand
managers should try to distinguish their brand by stressing on the characteristics they claim
will match the target consumer group’s needs more thoroughly than that offered by the other
brands. Then they should create a product image matching with the apparent self-image of
the targeted segment. It is important for any company to create a brand identity so that they
can build up a relationship with the consumers creating an image of the brand (de’Chernatony
1992; Fill 2002; Kapferer 1997) on the contrary, Newsom et al. (2000) opine that celebrities
may raise recognition, but a wrong celebrity, may actually lead to harm the image. Besides
this, according to Erdogan (1999), if the image of a product has been spoiled, association of a
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popular celebrity is one prospective solution. Walker et al. (1992) say that, it is easier to set
up a product image with an early celebrity endorsement than changing an existing product
image which is backed by a celebrity or through some other means. In a alike layer
Dickenson (1996) remarks that, celebrity endorsers attempt specifically, to pass on their own
images to the product. Companies should hire the celebrity who has necessary traits to
establish specific positioning for the products (Erdogan 1999).
Adding to this, Ratneshwar and Chaiken (1991) had put forward the argument that
any plausible source can be particularly influential if the consumer has still not learned much
about the product or shaped an attitude of it. Moreover, Tripp et al. (1994) belief is that it can
create excessive consumer awareness of the true character of endorsement, which has least to
do with the attributes of the brand/product, and more inclined towards the generous
compensation for the celebrity, leading the consumers to explicit pessimism about their
motives. Thus, when a brand not has a definite image it may have one fashioned for it
through use of an endorser whose image reflects the image an advertiser wants for the brand.
This is important because customers may perceive a brand as a representation of what the
whole brand or destination stands for. However, the celebrity should not tie in with too many
brands, because it will lessen his or hers credibility.
According to Kumar, S. R. (2000) Indian markets have been experiencing far-
reaching changes in the precedent decade from low to high-involvement product categories.
Shifting lifestyles, scrappy market segments and customer inclination, also intense
competition since the multinational corporations (MNCs) brands have made branding
strategies a precondition for success of marketing. Celebrity Endorsement strategy is one
among these branding formulae. In India, about 17% of all ads had celebrities endorsing the
brands. Crores of Rs. are spent yearly on celebrity endorsement agreements on the basis that
this plays an important role in influential communications (Surina, 2006).
India is a country, where the celluloid world is admired a lot. There exists a big deal
concerning Celebrity Endorsements in India. Here in the battle for mind and market share,
Indian companies have gone out of the way and engaged celebrities for endorsing their
brands. Procuring a celebrity for endorsement makes marvelous logic for a brand. In India
around 130 TV channels are broadcasting more than 3 million TV commercials each year. As
per the report of AdEx India, in the 1st quarter of the year 2008 60 percent of all advertising
dollars were spent on advertisements carrying celebrities, which were 25% in the year. 49%
growth was observed in celebrity endorsed advertising volumes on television for the period
[10]
of the year 2007 as compared to the preceding year. Today, this industry is worth Rs.550 cr.
and is rising at high double digit increase ranging between 60- 80% (Adex, 2009).
In India, there exists an exponential potential in favor of celebrity endorsement and its
impact on motivating consumers purchase decisions. In India, celebrity endorsement is
considered as a source of glamour and image. It’s a fact that the finest endorsements attain an
eclectic equilibrium between the product and the celebrity (Blazey & Ganti, 2005). People
tend to forget 80% of the information after 24 hours! A piece of research states that the target
audience age group of 15-30 gets influenced first by cricketers, then Bollywood stars and
only then music, festivals and food (Kulkarni and Gaulkar, 2005).
2.3 Reasons for using celebrity endorsers
Reasons of celebrity advertising can be found in surplus in scientific literature.
According to Belch & Belch (2001) the reasons companies spending enormous amounts of
money to ensure celebrities appearance in their ads and endorse their products is only that
celebrities possess stopping power. They snatch attention to advertisements and increase
message recall frequency. Celebrities assist in recognition of brand names, form positive
attitudes toward the brand and provide a personality to the endorsed brand. In addition, it is
perceived that celebrities could favorably influence consumers’ mind-set, feelings and buying
behavior.
There are three main theories which provide reasons to the celebrity endorsement
advertising. These are as under:
1) The Meaning Transfer Model (McCracken, 1989)
2) The Elaboration Likelihood Model (Petty & Cacioppo, 1983)
3) The Three-order Hierarchy Model (Ray, 1977)
In the Meaning transfer model the reason for celebrity endorsement is based on the
assumption that by this the endorser brings his/her own personality specific meanings to the
brand. So such association will infuse the endorser’s specific meanings into the product
image, eg. Sachin Tendulkar is endorsing Boost energy drink. By this endorsement, Boost
has got an image of stamina increasing drink. Thus, the celebrities are considered the main
“players” in the course of meaning transfer (Johansson & Sparredal, 2002). Referring this
model, it is advised to use celebrity endorsement when the celebrity posses and able to
transfer the particular features which the company wants for the product.
[11]
With an aim to explain the process of persuasive communication to influence the
attitude, the Elaboration likelihood model (ELM) was developed (Johansson & Sparredal,
2002). Formation of attitude depends on the amount and nature of explanation of relevant
information that happens in response to a influential message. So, the efficacy of a celebrity
endorser in any advertisement depends on involvement level of the receiver. There exist
empirical evidences of using a celebrity endorser when the receiver’s involvement is poor,
because in that case the celebrity’s presence will affect attitudes more significantly.
The third model i.e. the Three-order hierarchy model, is quite complex. In this, there
lies three response hierarchy stages. These stages are based on perceived product
differentiation and product involvement. These different response hierarchies are the standard
learning, attribution/ dissonance and low-involvement (Floyd, 1999). According to this
theory, the celebrity endorsement is recommended when the consumers are unreceptive and
unresponsive, because then the focus of the consumers may be on non-message essentials
(Johansson & Sparredal, 2002).
In Indian context, as the involvement of the receiver is quite significant with the
celebrities, the meaning transfer model for celebrity endorsement strategy is used. So such
association will impart the endorser’s specific traits into the product image, eg. Saniya Mirza
is endorsing Bornvita little champ daily health drink. By this endorsement, the product has
got an image of stamina and smartness enhancing ads on to milk.
2.4 Threats of celebrity endorsement
Celebrity endorsement is not always successful. There exist lots of risks associated
with it. In views of both Buck (1993) and Tripp et al. (1994), the significance of an elite
accord with the celebrity and the added exclusivity is that the larger the pulling powers of the
star, the bigger the risk. In support of this, Leventhal (1994) recommends that celebrity
endorsements are always associated to a high-risk, high-reward state and there always
remains a human element of which you are not aware of, and you are to evaluate the potential
risks against the potential rewards. According to McCracken (1989) an endorsement is
winning, when the features of the celebrity are adopted by the endorsed product. Though, the
study carried out by Walker et al. (1992) supports the endorser having certain desired
attributes for endorsing the product. Selection of an appropriate endorser for the product is a
crucial and complicated task. While selecting a celebrity endorser, both the product attributes
that are to be given and specific meanings associated with the endorser’s personality should
[12]
be considered. Also, It is important that any prior promotional campaign by the endorser
should not conflict with current endorsed product (Newsom et al., 2000). Holloway and
Robinson (1995) opine that there is a threat with personality based advertising, as when a
personality suffers with unfavorable public relations exposure, the credibility of the brand
also suffers.
Just an insight in the utility of celebrity endorsement is not enough specially when
seeking to make sure the effectiveness of an advertisement. The effectiveness of celebrity
endorsement in advertisement depends on the degree of association between the brand and
the celebrity, but the formation of such a link is synchronized with the risk (Till, 1998). The
threats underlying the celebrity endorsement can be segregated into three broad classes:
1) Celebrity-related risks,
2) Product-related risks,
3) Financial and other risks
Risk or exposure of each kind is based on different assumptions.
The first risk entails the peril of negative advertising concerning the celebrity (White,
Goddard and Wilbur, 2009). It is due to the strong relation of brand with the celebrity.
Incidence of a negative publicity about the celebrity may brim over the brand image. Also
there is a risk of moral danger. That means, some mall practices of celebrities may damage or
alter their images. Such alteration in image can harmfully affect the meanings actually the
advertisers wish to convey to their brands by the endorsement (Tellis, 1998). The celebrity
related risk also involves extinction (Johansson & Sparredal, 2002). Say for example, an
sportsperson who wins a gold medal in the Olympics, proved to be a very good endorser for a
specific brand. Unfortunately, the athlete gets injured or facing a lower swing of career then
company must shift to the other celebrity.
The second risk is of overshadowing the brand. It is the situation where the attention
of the consumers remains only on the celebrity not on the brand being endorsed (Erdogan,
1999; Belch & Belch, 2001; Ericsson & Hakansson, 2005). Overexposure as well as
confusion also increases the risk (Ericsson & Hakansson, 2005).
According to Tandon & Melhrotra (2005), financial risk is also involved in celebrity
endorsement. Celebrity endorsement contracts with famous entertainment and sports
celebrities are very expensive. Being rational, it is important for company to consider if the
celebrity endorser is worth the investment. All these hazards should be addressed in the
procedure of celebrity’s selection for advertising.
[13]
So, before execution of the strategy, aggregate of all symbolic meanings of the
endorser’s personality should be given a bull eye. However, theoretically it is fine to
investigate symbolic meanings associated to any celebrity but its practical implementation is
quite complex because of the complexity of cultural values and meanings inherent in his/her
personality (Walker et al., 1992). Company’s control over the celebrity’s public persona is
sheer because a celebrity has created its own persona over the years. Therefore, it will be
significant for the marketing manager to perform with great analytical skills allowing him or
her to decipher information from several sources prior to selecting the appropriate attributes
of the celebrity for the endorsed product.
Over-exposure of any celebrity may have a ill effect. The customer begins losing the
focus and also the communication message gets blurred. The consumer feels unable to attach
with any brand (Gahlaut, 2010). Just like what happened in the case of Amitabh Bachchan,
the Bollywood image appeared in 2 campaigns running at the same time on TV those days. In
one of them, he was promoting his forthcoming reality quiz show KBC (Kaun Banega
Crorepati); in the other, he was endorsing the Challengers Trophy cricket, which was
expected to begin the coming week in South Africa. Both were so similar in their styles that
the message would be lost if someone doesn't watch the full advertisement.
The fundamental objective under celebrity endorsement is to transmit the values
associated with the celebrity to the brand or product and thus establish the brand by use of
that alliance, which obtains immediate recognition, superior attention and therefore higher
sales revenues. However, there too exist darker sides of celebrity endorsement, since a brand
can anytime fall down in the consumers’ mind as quickly as it stirred up. There are a lot of
examples of brand failure in spite of being endorsed by most appreciated celebrities. For
example, Rani Mukherjee failed in endorsing a cycle brand where she is used only due to her
popularity without looking for Brand-celebrity fit.
2.4.1 Pros and Cons of celebrity brand endorsement
After having an in-depth insight over the celebrity endorsement strategy, its clear that
this strategy has its own benefits and drawbacks. Considering the advantages and risks at the
platform will enable a marketing manager to plan the strategy in a better way. Below table
provides a quick overview of the pros and cons of celebrity endorsement.
Table 3Pros and cons of celebrity endorsement.
Potential Potential Hazards Preventive actions
[14]
Advantages
Increased
Attention
Over shadow Pre testing and careful planning
Image polishing Public controversy Buying insurance and putting clauses in
contracts
Brand introduction Image change and
over exposure
Explaining what is their role and putting clause
to restrict endorsements for other brands
Brand
repositioning
Image change and
loss of public
recognition
Examining the life cycle stage of the celebrity
and what is the future perspective
Underpin global
Campaigns
Expensive Selection of celebrities on the ground of their
being suitable for targeting the global audience
2.5 Selecting of celebrity endorsers
Literature reveals that there are number of models and criterion for selection of an
appropriate celebrity endorser (Johansson & Sparredal, 2002; Ericsson & Hakansson, 2005;
Ohanian, 1991; Shimp, 2007; Bergstrom & Skarfstad, 2004; Osorio, 2002; etc.). For celebrity
selection, some of the authors describe only selection criteria, whereas others suggest use of
models consisting of number of criterion.
The Source credibility model is based on the supposition that consumers are
more expected to accept any message if they find it credible. This model is
based on two main criteria, one is source expertise and another is
trustworthiness.
In the Source attractiveness model criteria such as similarity, familiarity and
liking are used.
To select a celebrity endorser, companies also rely on “Q” Ratings which are
calculated as the ratio of the popularity percentage and the familiarity
percentage. The “Q” Rating is measure of appealing ability of the celebrity.
The TEARS model (Shimp, 2000) emphasise on attributes such as
trustworthiness, respect, expertise, similarity and attractiveness.
While the No TEARS approach engages both the attributes for celebrity and
risk evaluation for selecting the endorser. Celebrity credibility, celebrity and
audience match up, celebrity and brand match up, celebrity attractiveness, cost [15]
considerations, working ease or difficulty, saturation factor and trouble factor,
all are involved in the No TEARS approach.
FREDD is an acronym for familiarity, relevance, esteem, differentiation and
deportment (Ericsson & Hakansson, 2005).
2.6 Brand Celebrity Endorsement
Brand by definition of American Marketing Association Dictionary, is name, term,
design, symbol, or any other feature that identifies one seller's goods or services as different
from those of the other sellers. Brand is considered as the most valuable asset of any
company. Corporates often borrow celebrities name to use for advertisement of its brand.
Corporates relate the celebrity name with their product so that they could encash the
endorsement cost. This sort of promotional stunt is endorsement (Erdogan, 2010). Using
name or presence of any celebrity for advertisement is brand endorsement. Through
Endorsement, if Celebrity has personally used any product or service and is in a position to
confirm its quality, then he or she may give a testimonial noticing its benefits. For instance
Bipasha Basu, endorses sugar free delight by certifying the quality of the product, as it is a
part of her consumption basket. Endorsements basically lend weights to the product
credibility (Kapferer, 2012).
Product endorsements are basically testimonial from some personalities that indicate
their preference for a product. Branding gives identity to a product of any company. Brand
personification by celebrity endorsement is an efficient option especially for Indian
marketers, because of the diversity of the Indian consumer based on religion, ethnicity, value
system and most importantly economic status. For coping with the diversity, Corporate need
an icon far away from any sort of disparity. Usually, brand endorsements are solicited from
socially prominent people, allowing corporate to advertise their products just by sticking
alluring lines stating such as- “Used by ……” or “Recommended by ……”
The product endorsement concept is quite primeval. In western countries, for
example, many companies marketing their products just by an association with the British
royal family. Some have been marketing themselves using the tag line by appointment to the
Queen. Consumers get seduced by such advertisements (Byrne, Whitehead and Breen, 2003).
Contemporary product endorsements are done by using the celebrities, which costs more to
the corporate. A prominent celebrity endorsed product does not imply that the product is of
good quality, but it just mean that the producer has managed to associate the big name with is
[16]
product. Thus, some endorsements may be misleading and faulty, just driven by monetary
benefits of both corporate and the celebrities.
According to Celcom (M) Bhd CEO, Datuk Seri Shazalli Ramly, using a celebrity as
an endorser or spokesperson is very useful but its efficiency totally depends on the target
audience. In the views of Shazalli teenagers and those who are in their 20s, found to be most
receptive towards such celebrity endorsements as they are more tempted towards the trends
and happening things.
Few years ago, FMCG major Cadbury noticed itself in the middle of a storm. News of
worms in its dairy milk bars leads the chocolate major into intense mess just after the Diwali
season. It then lined in the Bollywood superstar Amitabh Bachchan to guarantee consumers
for the quality of its products. Similarly Shah rukh Khan (SRK) stepped in to restore
confidence of the customers for the largest private sector bank in the country i.e. ICICI bank.
Celebrities struggling with controversies may spoil the brand image. In that case
endorsement will prove to be a curse for the firm. However to cope with such situations,
brands can drop the celebrity once they are found to be involved in negative controversies
e.g. Michael Phelps was dropped by Kelloggs after emergence of his pictures of smoking
(The Star online, 2009). President of the Chartered Institute of Public Relations, Tony
Bradley defines brand celebrity endorsement as the HALO Effect as the aim is to rub off the
celebrity’s glamour to the brand or product. This glamour can be its beauty, strength or life
style. According to Rose Bentley we are living in a celebrity led culture. Here we want
everything just like our celebrities irrespective of suitable to our personality (The
Independent, 2006).
Often we found ourselves paying more attention commercials on electronic media or
paper media when we notice appearance of someone famous. Also trying a product endorsed
by our stars, considering it worthy of their endorsement. According to the marketers the
formula for capturing a lion’s share in the market is to simply hook a product to a star. Many
a times brands chose a celebrity just because of its name, pretty face or celebrity status, rather
they should consider the suitability of brand image with the image of the endorser celebrity.
Building a campaign around the celebrity may harm the brand image. Celebrities appear with
their own image. That image should be the point of choice. There's no doubt that celebrities
prove to be effective in promoting the existing brands and creating recognitions for the new
arrivals in the market (Daniel, 2002).
[17]
2.7 Consumer Buying behavior
Consumer buying behavior can be defined as the decision processes and acts of
consumers involved in buying and using the product also referred to the buying behavior of
the ultimate consumer. Under the umbrella of consumer buying behavior, we have to study
following issues
Reason behind a particular purchase by the consumer
Factors influencing the consumer’s purchases
Evolving new factors
From a firm’s perspective study of consumer buying behavior is of profound importance
because:
It is going to decide the buyer’s reactions to a firms marketing strategy which will
leave a great impact on the firm’s success.
In order to design a consumer oriented marketing strategy, it is imperative for firms to
analyze the consumer’s buying behavior.
It would be easier for the marketers to forecast the reaction of consumers.
2.7.1 Consumer Buying Process
There exists Six Stages of the Consumer Buying Decision Process. Actual buying is
only one among the six stages of the process. Every decision process may not lead to a
purchase necessarily. It’s not mandatory to have all the six stages in a decision process
(Cunnigham, Gerlach et. al., 2005). This is a general process. The 6 stages are:
Figure 7 Buying process.
1. Need Recognition & Problem Awareness
2. Information search
[18]
3. Evaluation of Alternatives
4. Purchase decision
5. Purchase
6. Post-Purchase Evaluation
Need recognition may be self accessed or can be noticed by means of someone else’s.
This someone will be one among the reference groups of the consumer. Here, celebrity
endorsement comes into the scene. Many a times need assessment by us is just because our
favorite stars are using or consuming it. Also for information search and alternative evolution
will be swept from our buying decision process whenever celebrities of our choice are
associated with the marketing communication. Thus, a celebrity being associated by any
means influence our decision of buying.
2.7.2 Types of Consumer Buying Behavior
Purchasing decision involves risk in it. This risk can be personal, social or economic
in nature. Influenced by the risks involved in the decision a consumers buying behavior can
be fragmented in following types:
Routine Response/Programmed Behavior: Such behavior can be noticed in buying
low cost items with a low degree of involvement. Such purchases need very little
search and efforts, e.g. soft drinks, snack foods, milk etc.
Limited Decision Making: Such behavior will be for occasional buying. When you
want to obtain information about untried brand in a common product category,
perhaps. This requires a reasonable amount of time for information gathering. E.g.
Out fits; know product class but no idea about the brand.
Extensive Decision Making: Here it involves a complex, high involvement,
unfamiliar, expensive or infrequently purchased products. High degree of risk is
involved in such buying, like economic/performance/psychological risk. E.g. cars,
homes, computers, education. A lot of time will be spent on information search.
Information from the reference groups, such as companies MM, friends and relatives,
store personnel etc., will be gained. Then will follow all six stages of the buying
process.
Impulse buying: In such buying no conscious planning is done prior to the purchase.
Any buying decision of a buyer will be effected by following factors:
1. Personal
[19]
2. Psychological
3. Social
Taking into consideration the above stated factors, while preparing Marketing strategies is
very important for its being appropriate (Ferrell and Hartline, 2010).
Personal Factors
These are unique factors of any individual. Factors like sex, race, age etc. are included in it.
These are going to decide the target segment of the marketer.
Psychological factors
Psychological factors includes the following-
Buying Motives
Perception
Ability and Knowledge
Attitudes
Personality
Lifestyles
Social Factor
Social factors includes -
Opinion leaders
Roles and Family Influences
Reference Groups
Social Class
Culture and Sub-culture
By understanding the buying behaviour of the consumer, marketers could offer higher
satisfaction to the consumers. (Utility maximisation) Marketers by celebrity endorsement,
target the psychological factors. By celebrity endorsement a firm tries to influence the
consumers’ just by framing the product image in accordance with the target consumer’s
lifestyles, personalities, attittudes and perceptions (Consumer Buying Behavior, n.d).
2.8 Impact of Celebrity Endorsement on buying behavior of the consumer
Many studies have already been conducted to frame the impact of celebrity
endorsement on the consumer buying behavior. Glimpse of those studies is given here. Those
days had become now history when brands were limited and just their tag lines were enough
or publicity, e.g. “Thanda matlab Coca-Cola” This tag line used by coca Cola India reaped
[20]
enough profit for the company along with the brand recognition. At higher stages of lifecycle,
there increase the intensity of competition in the market. In such circumstances, in order to
sustain and being competitive, company’s try to use any means for proving its product
superior to their competitors. At this stage they have a very effective tool in their hands, such
as celebrity endorsement. Such association of brands with the celebs makes their products
popular as well as unique in the eyes of the consumers (Erdogan, 2010).
Using a celebrity in any ad is just like building a bridge between the consumer and the
producer. To target the consumers, producers select the celebrity suiting their product image.
For instance, a life insurance company will tend to have a celebrity according to their product
demand, say for a pension plan, they would prefer a celebrity in the age of 60 or above where
as for a children plan will target the individuals in the age of 28 years and above (Clemente
N. Mark, 2002).
The most important factors which will be going to decide the effectiveness of
promotion by endorsement is the endorser’s credibility and personality because these two
factors will reflect the product’s quality and reliability. E.g. cement companies choose such
personalities, who possess a strong and powerful personality, for endorsement like Amitab
Bachan for Ambuja Cement, Javed Akhtar for Jaypee Cement, Om Puri and many others.
There are many concrete reasons for having celebrity endorsement by companies but the
most crucial is to grab high appeal and proper message delivery in the ad. By this, they tend
to segregate their target customers Kulkarni & Gaulkar, 2005).
Celebrity endorsement is extremely vital and the very basic tool for product
promotion. Nowadays it has become a fashion for the product marketing and brand building.
Though, it seems simple to select a celebrity but it is quite complicated to establish a sturdy
relationship between the product and the endorser. Better brand image and higher profits are
two fruits of celebrity endorsement (Vijay, 2011).
To achieve the full potential of celebrity endorsement, brands use different models,
this highlights the need for a convergence between the pragmatic and theoretical approaches
of brand building and effective advertisement. This strategy has gained the momentum in last
decades or so showing the importance of celebrity-brand match and the various roles played
by them as brand-associates. Certain ideas like 'diminishing celebrity utility', like 'positioning
by association' and the Multiplier Effect, show the triangular relationship between the brand
consumer and the celebrity.
[21]
Indians are star-struck by film stars, politicians, cricketers and even by criminals.
Have we ever thought the reason behind this? A population of over 121 crore (India Cencus
Report, 2011.), among them every day people look up for something and someone admirable.
Emotions like security, admiration, comfort, familiarity, and above all aspiration af the lives
are to be associated in order to get them fulfilled. And the witty marketers leverage this awful
celebrity appeal and are successfully doing the jobs capturing market share, profit and even
recall. But the endorsement should not sound like a gimmick to the audiences, due to the too
much star power. E.g. Amitabh doing ad of Tide, seems like publicity stunt only as the
consumer are pretty sure of tide not being used by him.
Now, in spite of the potential benefits resulting from celebrity endorsements, they
enlarge a marketer's threat manifolds and should be treated with full attention and propensity.
A brand needs to be cautious when employing celebrities to ensure believability and delivery
of the proposed outcomes (Byrne, Whitehead and Breen, 2003).
Proof of public demand for icons to look up to is the growing importance of legendary
characters as celebrities and their influence over the target segments. As the celebrities cross
from a sheer commercial presence to public interests message endorsements, a complete new
aspect is added to this course and helps us to have a holistic vision of the impact which
celebrities cause in every sphere and segment through their knowledgeable endorsements.
The most vital thing to keep in mind is that putting a celebrity in an ad is not an idea in itself.
Unfortunately, that’s how most celebrities are being used in Indian advertisements, where
they are used just like a prop. Preferably, there must be an idea that relates the celebrity to the
product and finally make an appeal to the consumer.
Presence of a celebrity in the ad should be appropriate. Celebrity endorsement does
not guarantee a fool-proof success. The celebrity endorsement strategy must be incorporated
with the target market characteristics along with the other elements such as product
designing, packaging, branding, and pricing.
2.9 Indian Soft Drink Industry
The 50-bn-rupee soft drink industry in India is growing at the annual rate of 6 to
7%. Around 95% market share is being occupied by Coke and Pepsi combined through
franchisees or by self presence. Campa Cola is having 1% share, and the rest is divided
among the local players. In India, about 110 soft drink producing units (60% being owned by
Indian bottlers) are running, providing employment to about 125,000 people. This market
[22]
further segregated in two distinct segments such as cola and non-cola drinks. 62% share is
claimed by the cola segment, while the non-cola segment includes drinks with orange and
mango flavors, cloudy lime, clear lime, and soda.
In India the per capita consumption of soft drinks is around 5 to 6 bottles, which is
quite les as compared to the other Asian countries. This industry also supports in the growth
of other industries like glass, sugar, refrigeration, Paper and transportation. Soft drinks and
aerated drinks were regarded as the products for the middle class and the affluent one in past.
But this assumption is no more valid. Such drinks are consumed by all excluding those who
cannot pay for any drink. An NCAER study has shown that 91% soft drink sales revenue
comes from the lower, middle and upper middle classes. As per the industry estimates, the
beverage market should raise with just double rate that of the GDP growth. In short the
Indian Soft drink market should grow by 12% whereas it is presently growing at a rate of 6%.
India proved to be perhaps the toughest battle feild for the Cola giants. Presence of
Coca-Cola, the world’s number one player in the soft drink industry, in India can be traced a
long time back in collaboration with and Indian producer. Then the Indian market was
dominated by some local brands, with Limca at the top. Cola flavor was the largest selling
flavor claiming a market share of 40%, lemon flavors’ with 30% and other orange drinks with
19% share of the market. Till 1977, Coca-cola remained the leader. But backed by some
industrial reforms introduced by FERA i.e. Foreign Exchange Regulatory Act, Coca cola
have to take foot back from Indian market. After 16 years, in 1993, Coca cola made a
comeback.
Mean while PepsiCo was trying to enter in to Indian market. In between late 80’s and
early 90’s, PepsiCo started struggling to an entry in the Indian market. Exit of coke, was a
good symbol for PepsiCo. Delhi based pure drinks, launched Campa-cola, just to benefit from
coca cola’s exit. By the end of 1970 Campa cola was the only cola flavored drink in the
market. In1980, Parle, launched ThumsUp who was another major Indian player. Thumbs Up
is a very popular soft-drink in India. Thums up being called as soft drink was opposed by the
rest industry as it has a strong flavor. For over a decade, Parle led the Indian soft-drinks
market, with its reaching a peak of 70% in1990. Coca-Cola reentered in India after the
economic liberalization era, but that time world’s number two players had already established
themselves in the industry. Coca Cola changed the strategy and acquired the well flourishing
soft drink company Parle. Since then it has been a fight between two American giants, rest
[23]
were only the peripherals of the two MNC’s. The third biggest player of the world, i.e.
Cadbury Schweppes, also tried its fate but Coca Cola swallowed it.
Currently, Coca-Cola is operating all the way through 35 plants and 16 franchisees
throughout the country, whereas PepsiCo with 20 plants and 7 more franchisees i.e. 23.
Market share of Coca-Cola amounts to be 51%, whereas Pepsi has a share of 46%. There
exists a great dispute for the market share claims.
2.9.1 Industry overview
Coca Cola, Thums Up, Limca, Fanta, Gold Spot, Rim Zim, Maaza, Pepsi, Mirinda, 7'UP,
Mangola, Slice, Duke's, Lemonada, Crush, Canada Dry, Campa.
Aerated Soft Drink statistics (India)
Figure 8 Demand of Aerated Sort Drink over time.
The above Line chart for the demand of aerated soft drink shows the consistent
increment in the demand. This Consistent upward move of demand implies the attractiveness
of the soft drink industry. Over the last twenty years soft drink demand has almost increased
by 300%.
[24]
Figure 9 Market Share
Figure 10: Market Growth over time
Figure 11: Geographic Distribution of the market
(Source: Indian Ministry of food processing industry, 2012)
Characteristics of Indian Soft drink industry are as follows-
Extremely cutthroat, conquered by PepsiCo and Coke [25]
Coca Cola claims 51% of the market share whereas Pepsico holds 46%.
Growth rate in 2010 of Coca-Cola was 32%
30% rural and 70% urban consumers
The per-capita consumption of soft drinks in India amounts to be 6.
Increased health consciousness making fruit juices, Malt Based Drinks (MBDs) on
a growth path
Pesticide controversies affected CSDs sale significantly in India
Category 2005 2006 2007 2008 2009 2010
Regular 16720 15491 15802 16492 20433 23254
Low-calorie 302 289 304 321 395 445
Cola Carbonates 17022 15780 16105 16814 20828 23699
Lemonade/Lime 10045 10183 10787 11658 14312 16879
Mixers 3552 3629 3726 3811 3915 4145
Orange Carbonates 7361 7435 7690 8034 8717 9152
Others 1940 1993 2081 2198 2787 2438
Non-cola Carbonates 22897 23240 24283 25701 29731 33614
Total 39919 39020 40388 42515 50559 57313
Table 4 Category-Wise Off-Trade Sales of Carbonated Drinks In India Between 2005-
10 (In Rs. Million)
Figure 12 Category-Wise Off-Trade Sales of Carbonated Drinks In India Between 2005-
10 (In Rs. Million)
2.10 Conclusion
Strategic positioning along with effective communication are the most significant tools
for Brand success in today’s time of competitive marketing activities. Firms are ready to take all
[26]
pains for promoting their brands. The thrust is for attracting the customer’s attention and
establishing a positive association to effect their purchase decisions. This motive can be fulfilled
by celebrity endorsement. Being a celebrity an individual possess the charm to influence others.
Celebrities enjoy public recognition due to their work or profession.
Indian public is highly fascinated and inclined towards the celebrities. Indian market
history provides concrete evidences of contribution of celebrity endorsement and its impact on
the consumer buying habits. Advertisements, featuring stars like Jalal Agha (Pan Parag),
Tabassum (Prestige pressure cookers), Sunil Gavaskar (Dinesh Suitings) and Kapil Dev
(Palmolive Shaving Cream) became common. Pataudi had given Gwalior suitings a well-built
competitive edge and pushed it to 2nd position in the suitings market. Also Sridevi endorsing
Cema bulbs and tubes made it memorable by dancing in a bulb!
Many of the popular Indian brands have become reflections of the endorsing celebrities.
E.g. Think of Sachin Tendulkar, he means PEPSI in soft drinks, Boost in malted beverages, Fiat
Palio in cars, TVS victor in two wheelers, Colgate Total in toothpaste, Britannia in Biscuits, Visa
in credit cards, Airtel in mobile services and many more also Ashvarya Roy Bachchan means
Nakshatra diamond jewellery, Lux soap, total 5 repair shampoo etc. Companies are employing
their maximum might for promoting their brands and occupy a long lasting image in the minds
of the consumers.
Indian soft drink advertisements are endowed by celebrities, let these celebrities be sports
stars like Mhendra Singh Dhoni, Sachin Tendulkar, Virendra Sehwag etc. or be the celluloide
screen super stars like Kareena Kapoor, Ranbir Kapoor, Amir Khan etc. Coca Cola being the
leader (holding 51% market share) of the industry has come up with plenty of endorsements as
its marketing strategies. Affording these celebrities amounts high for the corporate houses.
[27]
CHAPTER 3: METHODOLOGY “Advertising people who ignore research are as dangerous as generals who ignore decodes
of enemy signals. “
– David Ogilvy
Research is just not about collecting data but includes the process of deriving the
objectives of the study. For this a proper method should be adopted. This method will define
how you will reach to your problem’s solution, what step need to follow (Goddard, W. and
Melville, S. 2004). Methodology for a research is defined by Panneerselvam, R. (2004) as a
system of models, procedures and techniques used to find out the results of a research
problem. In the context of the study, this part of the study tends to describe the entire process
of the research i.e. outline the research plan. Here in this chapter, the methods, sample,
population, tools and techniques used in the study will be discussed. The pros and cons of the
selection of particular technique along with the authentication of the choice will be done. It
describes the what and how questions of the process, like; what must be done; how it will be
carried out; what data are required; what data collection device should be used; how to
choose sources of data; what analysis tools and calculations should be used and how to derive
the conclusions (Singh and Bajpai, 2008).
A research can be a very abstract and complicated in nature. While designing it,
researchers need to create some logical understanding of the issue or topic of the research.
This logical understanding or framework helps in understanding the issue clearly and
accurately. There are two major philosophy related to the research- positivist and interpretive
(Crossan 2008, p. 48).
Here for the research a positivist philosophy has been adopted. Positivist philosophy
believes that any reality is independent of human behavior and it cannot be a creation of
human mind. It is considered that real knowledge can be derived from the observation of
objective reality (Flowers 2009, p. 265). Positivism is mainly based on collection of facts and
data through different observation which are reasonable, true and valid. These data mainly
collected through the quantitative methods like surveys and experiment and for their analysis
different statistical tools and methods are used. In research related to the organization,
positivists assume that whatever happens in an organization can be measured or discovered
through study of people and system. Data gathered from them represents the reality (Vaus
2002, p. 223).[28]
Whereas there is another researcher philosophy termed as constructivist, also known
as anti-positivist. It provides an alternative for the conducting a research. In this philosophy it
is believed that reality does not exist in a vacuum and there are certain factors which
influence the truth or reality (Flowers 2009, p. 265). Culture, gender, beliefs are some of the
factors which influence the construction of reality. Positivism claims about the truth through
generalization and law, whereas interpretive search for valid and sound proof evidences to
describe a phenomenon. Here our research is an explanatory one where our intention is to
avoid subjectivity. For this a positivist philosophy best serves the research aim.
It has often been observed (e.g. Benbasat et al., 1987) very precisely that no single
research methodology is better than any other methodology, many authors call combination
of research methods best way to improve quality (e.g. Kaplan and Duchon, 1988). In contrast,
some institutions enforce that amy single methodology should be used (Galliers, 1991).
While designing a research, the most significant decision is related with choice of
research approach. Its selection should be done systematically and accurately, because the
choice determines how we would obtain the information for our research.
Explanatory research tries to elucidate why and how there is a rapport between two or
more aspects of a situation or phenomenon whilst, an exploratory research is a type of
qualitative research that focuses on understanding the current state of the affairs with respect
to specific settings. Explanatory research is one conducted in order to clarify any behavior in
the market. It could be done through using questionnaires, group discussions, interviews,
random sampling, etc. The nature of this research is more explanatory and provides the
relevant data about the specific variables that are being examined. This research can be used
for establishing cause and effect relationship between the variables and outcomes. This
approach would help us in determining that up to what extent consumers’ buying behavior
gets influenced by celebrity endorsement (Matthews and Kostelis 2011, p. 221).
3.1 Research Methods
Research means different to different people. In a layman’s words research is a formal
way of asking questions. Usually we start research by specifying our area of concern I.e. what
we want to know and about what. Then we go for asking the questions following a structured
approach. This structure is nothing but the methodology.
[29]
Different kinds of methodologies are there to be adopted for carrying out a research.
Some of them are very simple whereas some are very complicated. Research methodologies
used here are:
- Qualitative research
- Quantitative research
- Case study method
Each of them can be applied for different purposes. They can be applied separately as
well as in combination also.
Qualitative method aims to sharpen and deepen our understanding about the
behavioral aspects. This means study beyond the numbers. Through qualitative research we
can give resins to our numerical findings. This method complements the quantitative
methods. More often both will be used together for a better and bigger view of the situation.
This method enables us to flesh out the story.
Quantitative method involves data or information’s in the form of numbers. By this
method we can measure or to quantify the outcomes. Through this method we derive a causal
effect or relationship between the variables. The most common way for conducting
quantitative research is the use of survey. Surveys can be carried out by filling questionnaires.
The worth of a survey is in its being standardized since each respondent (person who will fill
out the questionnaire) will have to answer exactly the same questions. Once you are over with
the response collection, you can apply quantitative techniques on the observed data and
analyze in accordance with your research problem.
Case study research permits the exploration and understanding of complex issues. It is
considered as a vigorous research method mainly when a holistic and in-depth study is
required. The role of case study method in research has become more important for issues
regarding education (Gulsecen & Kubat, 2006), sociology (Grassel & Schirmer, 2006) and
community based problems (Johnson, 2006), like poverty, unemployment, drug addiction,
illiteracy, etc. Through case study methods, a researcher can go further than the quantitative
statistical results and understand the behavioral conditions. By including both quantitative
and qualitative data, case study assists explaining both the process and outcomes of the
phenomenon through inclusive observation, modernization and analysis of the cases under
investigation (Tellis, 1997).
Case study method is a way of capturing concrete details of a real time or fractional
situation, supporting your area of study. This method has its roots in history of last 80 years.
[30]
In a case study data will be presented in a structured and compact way. Case studies put in
the picture the story which is quite lively and colorful. Case studies are used in almost all
disciplines. They help to have an insight of particular problems of businesses and their
remedial actions in that particular situation. As in a case study a structured format is
followed, they facilitate the comparative studies.
Quantitative data can be justified as backed by some numbers, whereas this is not the
case for qualitative data. This unique feature of quantitative methods makes them much
preferred among the researchers. Here, a blend of qualitative, quantitative and case study
methods is used for fulfillment of the objectives.
3.2 Research Motives
1. Consumers are likely to consider products that use celebrity’s endorsement.
2. Consumer’s buying decision is influenced by the presence of celebrities in the ads.
3.3 The Population
This study is a field work based study, which aims to evaluate the effectiveness of
celebrity endorsement strategy in Indian soft drink industry. So the population of the study is
India.
3.4 The Sample
Sampling is the most important process under the research methodology. Sampling
strategy is mainly used for the selection of the appropriate sample under the research work
for the purpose of primary data collection. Range of sampling strategy under research
methodology section is available. Broadly this can be categorized into probabilistic sampling
methods and non probabilistic methods (Goddard and Melville 2004, p. 115).
A sample of 92 respondents is taken from the concerned population. Sample is drawn
by using convenience sampling method. Convenience sampling is also termed as grab,
haphazard, accidental or opportunity sampling. In this method, the researcher makes use of
subjects, which are easy to approach. As the name illustrates, subjects are chosen because of
convenience. For example, students make use of their classmates in a research study or a TV
reporter interviews public on the street. Under this respondents were selected considering the
ease to approach. Here volunteer students, businessmen and housewives were taken as
respondents for the research.
[31]
3.5 Tools for Data collection
Here in this research, two sorts of data are used; one is primary data and other is
secondary data. Primary data are the fresh data collected for the current research only.The
primary data collection techniques comprise of data collection through observation,
interviews, psychosomatic measurements, questionnaires, focus groups etc. So as to collect
information related to present research, we have adopted questionnaire method. This data
collection method used here for our study can be expressed as primary method. Primary data
can be described as the data, which has been collected for the first time and for a specific
need of a particular research. Such data is collected for the already stated purposes and the
choice of method of the data collection depends on the researcher (Axinn and Pearce, 2006).
In the present study, very common method of data collection is used, that is the
questionnaire. Questionnaire is designed taking into consideration the research objectives.
The entire questionnaire is divided into five main sections concerning the variables under
study. First section projected to assess utility and popularity of soft drinks among the
respondents. Second section attempts to evaluate consumer perception towards celebrity
endorsement. Section three is to have a look into the relationship between the buying decision
and celebrity endorsement. Under fourth section, we try to review the importance of celebrity
endorsement from the advertiser’s perspective. In the fifth section attitudes of the consumers
towards the soft drink celebrity endorsers and different soft drink brands are measured on a
five point scale measure. We are going to use simple data analysis techniques like charts,
averages and Micro soft Excel tools. A five-point Likert scale is also used for measurement
of attitudes. The scale consisted of five levels (1 = poor; 2 = Fair; 3 = Good; 4 = Very good; 5
= Excellent).
3.6 Data collection
Questionnaires were used for collecting data. This questionnaire is divided into five
sections with 16 closed ended questions. Description of the sections is as under:
Questions from 1 to 4 assess utility and popularity of soft drinks.
Questions from 5 to 7 try to evaluate consumer perception for celebrity endorsement.
Questions from 8 to 11 illustrate the relationship between the consumer buying
decision and celebrity endorsement.
Questions from 12 to 14 sketch the significance of celebrity endorsement for the
advertiser in consumer’s opinion.
[32]
Questions from 15 and 16 measure attitudes of the consumers towards the soft drink
celebrity endorsers and different soft drink brands on a five point scale.
3.7 Validity and Reliability
To minimize the chances of acquiring erroneous results to our research questions
prominence on two scrupulous research designs have been given focus i.e. reliability and
validity.
Validity: Validity focuses on the evaluation of the findings and their quality. It largely
includes 3 sorts of validity;, internal validity, construct validity and external validity
(Golafshani, 2003). There are generally few strategies to create validity in any research i.e.
usage of multiple ways of evidence and set up series of evidence for the research. In this
report, two methods have been used to collect the data one is through questionnaire
(quantitative form) and the other is by conducting interview among the employees
(qualitative form). To form a chain of facts and data throughout the report references to all
the sources and foundation of research have been made and the medium of collection is also
mentioned. After crafting the interview channel, it has been approved by the supervisor
before accomplishing the interview to the respondents (Easterby-Smith, Thorpe and Lowe,
2006).
Reliability : It refers to the consistency and uniformity of the results obtained from the
research to the likelihood that similar results could have been attained if the actions used in
the research were virtual (Bergh and Ketchen, 2009). Reliability focuses on the exactness and
certainty of a particular finding. The crisis which might arise and could affect the results of
the study is the lack of knowledge of the respondents or if the respondent is drained, hassled
or have negative approach towards the interview could influence pessimistically on the study.
During the research, the researcher has struggled to discover the most appropriate respondent
with the right understanding in respect to the research area. The interview was scheduled at
the time when the respondents were comfortable to minimize the stress issue, though it was
possible that they might be stressed out due to some other factor (Gill and Johnson, 2010). To
make the interview session simple and effortless, a guide for it has also been designed which
reveals the model of the questions. The reports have been organized in a way that any of the
researchers can salvage any of the desired matter. The menace of personal biases is also a
factor that can influence the result to some extent so; the derived results should be questioned
from the respondent as well as the researcher’s own value and approach.
[33]
3.9 Limitation s
Sample taken for the study is relatively small (92 respondents), so the generalization
of the results may be misleading and inappropriate.
Limitation of resources is another limitation of the study.
Also because of the limited time, study may not be entertained with proper
enthusiasm as the topic is supposed to be. This research is completed in the previously
defined time slot which affects its trustworthiness, it requires more time for the
purpose of the research.
Report includes thoughts and views of various authors through literature review
which may be contradictory at times
Respondent have not provided the answers with authenticity, which also acts as the
limitation of the research
Some data is collected through the secondary sources where the observations of the
authors may be biased or not related to the study.
Findings of the research cannot be generalized as it has been conducted in a confined
area or territory
Small sample size
Location constrain, research is based only at London
3.10 Celebrity Endorsement Strategy: Case of Coca Cola India
Starting with just a sale of nine glasses of drinks per day, Coca Cola has written a
success story after a triumphant stretch of operations for about 125 years. Company’s current
production counts to be more than 10 billion gallons of drink per day and selling products
across 200 countries worldwide. With a portfolio of more than 450 brands, the company is
one among the largest beverage companies.
Coca Cola - the name came to India in the post independence era i.e. after 1947 in the
year 1956. That time, there was not any foreign exchange act to regulate overseas trade and
investment in the country. Take advantage of the above flaw of Indian legislation, Coca Cola
made enormous money operating under 100% foreign equity. The Indian foreign exchange
act came into force in the year 1974 during Indra Gandhi government age. According to this
act, for selling consumer goods, a foreign company must devote 40 percent equity stake in
India in its Indian associates. Coca-Cola decided for this but laid down a condition, of
holding full power in administrative and technical units with no local involvement allowed.
[34]
This condition was against the Indian Foreign Exchange Regulation Act (FERA), so
GoI instructed Coca Cola to either leave the country or write up a new plan. In 1977, when
Janta Party came into power, the stress for Coca Cola increased, and finally company decided
to quit. Coca Cola came to India with Rs. 600,000 only, which was not a big amount. It was
equal to an investment of $20,000 at the prevailing exchange rate of that time. But, at the
time of departure from India, the company had already made a profit amounting to be $ 8
million or in rupee term it was Rs. 250 million. In twenty years, nearly 400 times return was
reaped by the brand. Coca cola found India a very lucrative market, so after industrial
liberalization, company made a return. It was almost 16 years in 1993, when Coca Cola came
back.
16 years back, it was a monopoly market for Coca Cola, but now the game was
completely changed. Many local brands, Campa Cola, Thumbs Up, Gold Spot etc., had
already made their positions, besides those international brands like Pepsi and Cadbury were
also fighting for the market share. But still, Coke made it possible for holding 51% market
share after a journey of 19 years, all through its marketing and competitive strategies.
Subsequently, Coke made significant investments in the Indian market with an aim of
inclusion of more and more people, even targeting the remotest and inaccessible areas of the
country. It cemented its presence with a milestone deal of acquiring top most Indian soft
drink brands, such as Thums Up (one of the most trusted brand of soft drink in India), Limca,
Maaza, Citra and Gold Spot. This step of acquisition not only provided a wide portfolio but
also availed coke with physical manufacturing, bottling, and distribution assets along with
strong consumer preference. This portfolio of local and international brands made it possible
for Coke to encash the market opportunities. Company’s product portfolio became a
combination of global and local brands.
After leadership tenure of 19 years, Coca Cola holds a diversified portfolio of brands,
catering to the tastes of different consumer segments. In India, company’s portfolio is as
described in the underneath table:Table 3 Different brands of Coca cola and their marketing USP.
S. No. Brand Name Remarks
1. Coca-Cola General brand, targeting all segments
2. Diet Coke Diet conscious consumers
3. Sprite Youth, and smart consumers
4. Fanta Smart girls
[35]
5. Thums Up Youth, with thrilling atitude
6. Limca Fresh quench
7. Maaza Fruit drink, targeting children
8. Maaza Milky Delite Fruit drink, targeting children
9. Minute Maid Pulpy Orange Rich & nutritious orange drink
10. Minute Maid Nimbu Fresh Instant Ninbu Pani mix launched initially in southern
India
11. Burn Strong, fantasized drink
12. Kinley Water Pure water
13. Kinley Soda National brand for soda
14. Schweppes An International brand
15. GEORGIA Gold Espresso, Americano, Cappuccino, Caffe Latte,
Mochaccino, Hot Chocolate, Cardamom Tea
According to the author of “Treasure Island”, Robert Louis Stevenson, “Everybody
lives by selling something". Further he says, “Agents, CMOs and deal makers will always get
starry-eyed by the names of "celebrity". It is because, brands love endorsements, and
consumers buy into "celebrity."
Many recent studies concluded that sales figures of some brands have shown an
increase of almost 20% backed by endorsement practices. An associate professor at Harvard
Business School, Anita Elberse in a study found that some companies experienced an
increase of 0.25% in stocks, after the announcement of endorsement deals.
India is a huge nation, with cultural and geographical diversities, which has resulted
in existence of different language speakers across the country. Coca cola recognized this
assortment that is why they have produced ads in 6 or more languages, reflecting India's
linguistic diversity (Business line, 1998). Southern states of India habitually require different
strategies of marketing due to the notable cultural differences between south India and North
India. So Coca-Cola India came up with alternating celebrity endorsements for southern India
e.g. They have used Tamil superstars rather than Bollywood stars and promoted Coke
accompanying with regionally relevant food combos. Over and above these localized efforts
Coca-Cola has also come up with dialect style print and television ads. Known the extensive
fame of cricketers and movie stars, the company has lined in a host of cricketers and Indian
movie stars to endorse its products.
[36]
Celebrity endorsement, the key marketing tactic, is being adopted by many companies
for years. The same dynamic strategy of positioning and marketing communication was
adopted by the company, in order to fascinate the Indian market. More often, the company
attempted to rapt consumers in India by establishing an association with their passions for
say, cricket, movies, music or food. With a step of sponsoring the World Cup in 1996 and
subsequently various national tournaments inclusive of the Sharjah Coca Cola Cup in the late
nineties, the brand successfully gained identity among Indian urban population. Coke
attempted to play catch-up with a two-pronged gambit: One, introduction of jingles in the ad
campaign; and, two, inclusion of celebrity endorsement. From 1993 to till date, Company
taped the youth segment with celebrity endorsement and jingle based marketing. Jingles like;
“Always The Real Thing”,
“Pee Le Coca Cola”,
“Jo Chahe Ho Jaye...Coca Cola Enjoy”,
“Taste the thunder”, “Taza Maaza”,
“Life ho to Aisi”,
“Thanda Matlab Coca Cola” and
“Aaj Kuch Tuffani Karte Hai”
These identity slogans made the brand much popular among the youngsters.
Celebrities endorsement multiplied the effect of those jingles. Company spent crores of
rupees on such endorsements. This stimulate demand in the market by associating with life
style and behavior and mainly targeting value based advertising. It has many brand
ambassadors like Shahrukh khan, Hrithik Roshan, Ghambir, South Indian Actor Vijay and
Trisha, Aamir khan, Kareena Kapoor, Imran khan, Mahesh Babu, Sachin Tendulkar, etc.
These endorsements by Coca Cola changed from time to time. When Hritik Roshan
Debute movie released and received a grand success, Coke signed a deal with him. When
World cup seasons or IPL seasons come, endorsement strategy completely changes. At such
times of national or international tournaments, company uses cricketers, athletes for
endorsing the product. Similarly on festivals endorsement style and ad both change.
Coke commercial was endorsed by Hrithik Roshan for Rs. 3 crores. It was the highest
amount paid by the company of that time. Coca-Cola had signed Bollywood actress Genelia
D'Souza as brand ambassador of its launched product, Fanta Apple in 2008. In 2009, the
Coca cola had signed Gautam Gambhir for coke has a brand ambassador to leverage the
passion of cricket among youngsters. In 2010, the company signed Imran khan for the coca
[37]
cola endorsement. Coca-Cola had signed two years deal with bollywood actress Kareena
Kapoor to endorse its drink Limca for about Rs 2.5 crore a year.
Coca-Cola has dropped Akshay Kumar for Thumps Up in 2012 for Telugu superstar
Mahesh Babu. Thumps up for several years was endorsed by Akshay kumar by defying stunts
as its USP of its full of action commercials, but in 2012 he was dropped for Telugu superstar
Mahesh Babu, and, apparently to give its action-oriented commercials some liveliness and
glamour. The cola brand had replaced the actor with Kingfisher model Angela Jonsson, to
bring in the campaign with a touch of youth and beauty.
Maaza is currently playing common person commercial where a tag line is used
Maaza Mango Mania. This is a story concerning a father who is very much tempted towards
Mangos. His son entitles this as Mango Mania. His father was so fond of mangos that he start
imaging mango everywhere. When a Politian at some point in his election speech says
something on benefits for “Aam” aadmi, his dad again hits by the Mango mania. And then
the son lastly suggests giving his father a mango to drink that is Maaza rather than to eat. He
gets Maaza and his father finds relief for its mania. The Coca-Cola has signed the three-year
endorsement deal in 2011 with Sachin Tendulkar, where he is being paid almost twenty
crores. In 2010 The Company had launched Burn Energy Drink in Mumbai, New Delhi and
Bangalore, Maaza Milky Delite in Kolkata and Minute Maid Nimbu Fresh all over the
country. Now the top endorsers of cola brand are: Sachin Tendulkar for brand coke, Kareena
for Limca and recently Telugu actress Tamanna Bhatia is chosen as face of Fanta for Tamil
Nadu and Karnataka.
These endorsements cost quite high. Spending counts in crores. According to a news
agency, on an average a beverage company spends 20 to 40 million USD for such
promotional campaign. Coca Cola has a year long history of celebrity endorsement. It has
spent bucks for promotions. Spending trends on different brands for having a celebrity
association are as follows:
1. Company spent Rs. 20 (cr). To sign Sachin Tendulkar as its brand ambassador. As per
industry average, Sachin charges Rs. 5 (cr). Per an endorsement.
2. Kareena Kapoor, in new Limca ad, cost Rs. 2.5 (cr).
3. Amir Khan’s two years back endorsement campaign was of Rs. 10 (cr).
4. Akshay kumar charged Rs. 4.5 (cr). For Thumbs Up ad in 2010.
5. Sonam Kapoor singed coca cola endorsement deal amounting Rs. 3 (cr).
[38]
Coke till now has signed deals with 15 Indian celebrities for endorsement. These deals
have offered them more than their doing a single movie for an actor or tournament for sports
persons.
Figure 7 Spending for Celebrity Endorsement by Coca-Cola India.
In accordance with the spending, does the company really reap that high benefits from
such endorsement? Certainly yes, because in today’s competitive world, brand is the most
precious asset of any firm and associating a celebrity name with our most crucial asset is not
a joke. It’s a vital decision taken by the top management, whom to engage for the
endorsement and how much to pay?
[39]
CHAPTER 4: DATA ANALYSIS AND FINDINGS Data are collected through questionnaires. The questionnaire is divided into five
sections comprising of 16 closed ended questions. Here those collected data are analyzed
section wise. For data analysis, simple Microsoft Excel tools are used.
Demographic Information
Demographic information consists of numeric facts or statistics concerning groups of
populace. Demographic information would include information like age, profession, income,
inhabitance etc. A purpose for collecting demographic information is to understand the
respondent group’s characteristics and its probability of being a replica of the population.
Demographic information related to our study is the age group and the profession of
the respondents plus their genders. Below table shows the demographics of our respondent
group.
STUDENT
SERVICE AND
BUSINESS
MANS
HOUSE
WIFE Total
13-19 YEARS 8 0 0 8
20-30 YEARS 13 26 4 43
30-40 YEARS 3 27 3 33
40-50 YEARS 0 6 2 8
TOTAL 24 59 9 92
[40]
Our sample consists of students, Service man & businessmen and housewives. All the
three, in total, reflects the soft drink consumer group. In the sample, 64% respondents are
businessmen and service personales, 26% are students and 10% are housewives.
The sample includes respondents of all age groups starting from 13 years to 50 years
individuals. Majority of soft drink consumers lie in this age section only. In our sample 47%
respondents are youngsters belonging to age group of 20-30 years. 36% respondents belongs
to 30-40 year age group. Whereas teenagers and the oldies, belonging to 13-19 years and 40-
50 years age, are 8% and 9% respectively.
4.1 Data Analysis
Section 1
For measuring the popularity and judging the purpose of soft drink consumption in
the sample, section one is designed with four questions. Questions and the responses are as
under:
Q. 1. Which soft drink do you prefer?
Responses-
COKE 45
FANTA 10
7 UP 7
MAAZA 11
SPRITE AND LIMCA 19
[41]
Interpretation- From the above responses for the first question, it is evident that Coca-Cola
is the most preferred brand among the respondents.
Q. 2. How often you have soft drinks?
Responses-
ONCE IN A MONTH 10
DAILY 27
AS SPECIAL OCCASION 13
WEAKLY 42
Interpretation- This question aims to identify the frequency of consumption. According to
the responses, majority of consumers go for a soft drink on weekly basis and daily. This
supports the popularity of soft drinks in India.
Q. 3. For you, having a soft drink is:
Responses-
SATISFYING THE QUENCH 44
STANDARD SYMBOL 17
ADD ON TO FOOD 17
ALTERNATE TO WATER 14
[42]
Interpretation- 48% people says that they consume soft drinks to satisfy the quench.
Whereas 18% say that the purpose of having a soft drink for them is to maintain status. Rest
opine that soft drink is an add on to food or alternate of water.
Q. 4. What is your monthly spending on soft drink?
Responses-
LESS THAN RS 100 60
100 TO 500 3
500 TO 1000 10
MORE THAN 1000 19
Interpretation- Aim of this question was to trace the spending habits of Indian soft drink
consumers. Responses reveal that monthly spending of Indian soft drink consumers (65%) on
soft drinks is Rs. 100 or less. Whereas 21% respondents spending is more than Rs.1000. This
disparity of spending is due to the income and living status differences among the consumers.
Section 2
For having a look on the consumer’s perception about the celebrity endorsement, this section
holds three questions. [43]
Q. 5. What is the most persuading factor for you to purchase a soft drink?
Responses-
TASTE 44
PRICE 14
BRAND NAME 27
CELEBRITY ENDORSING 7
Interpretation- According to the received responses, the most enticing factor for consumer’s
purchasing a soft drink is the taste and the brand name. Celebrity endorsement is not their
concern. Price is another factor which effect consumer’s buying decision.
Q. 6. Do you think that the products particularly advertised by celebrities are of good
quality?
Responses-
YES 14
NO 29
50% 29
NOT SURE 20
[44]
Interpretation- For understanding the consumer’s perception about the relationship between
the product quality and celebrity endorsement, this question is designed. As per the responses
31% people believe that celebrity endorsement does not guarantee the quality of a product
whereas only 15% respondents say that a celebrity’s presence assures quality of the product.
Q. 7. Do you believe that celebrity endorsements make the product costlier for the
consumer?
Responses-
YES 39
NO 17
50% 26
NOT SURE 10
Interpretation- Responses for the questions reveal that majority of respondents think that by
using celebrities, the product becomes more costlier.
Section 3
To have an idea of the relationship between the consumer buying decision and celebrity
endorsement, we have used 4 questions in this part.
[45]
Q. 8. Companies invests large amount of money for celebrities endorsement; do you think
it’s worth for increasing their revenue?
Responses-
DON’T KNOW 18
YES 62
NO 12
Interpretation- responses supports the marketer’s decision of spending on celebrity
endorsement for reaping higher revenues. As 67% respondents say that by celebrity
endorsement companies can increase revenues considerably.
Q. 9. Do you feel encouraged for purchases due to the presence of celebrities like Shahrukh
Khan, Amitabh Bachan or Aishwariya Rai in an advertisement?
Responses-
YES 28
DON’T KNOW 37
NO 27
Interpretation- This question is designed to judge the motivating force of presence of a
celebrity on the purchasing decision of the consumer. In accordance to the responses, 28 [46]
respondents say that they feel encouraged due to the presence of the celebrities in the
advertisement for buying that particular product. While 27 say no such impact comes to their
decisions.
Q. 10. Do you think the celebrities also use those products which they endorse?
Responses-
NO 30
YES 19
DON’T KNOW 43
Interpretation- 30 out of 92 i.e. 32% say that celebrities themselves do not use those
products which they endorse, whereas 47% respondents do not have any opinion regarding
this.
Q. 11. What type of celebrity endorsement persuades you personally to purchase products?
Responses-
FILM STAR 30
FAMOUS CELEBRITES 24
CRICKETER 31
POLITICIAN 7
Interpretation- Cricketers and film stars are the most appreciated celebrities for influencing
the purchasing decision of the consumers. This is because 34% and 33% respondents say [47]
cricketers and film stars’ presence persuades them the most for purchasing the particular
product.
Section 4
This section aims to sketch the significance of celebrity endorsement for the advertiser in
consumer’s opinion. For realizing the purpose 3 questions are put here.
Q. 12. Does celebrity endorsement help in brand promotion?
Responses-
DON’T KNOW 12
NO 17
YES 63
Interpretation- In respondents’ opinion, celebrity endorsement helps the brand promotion. It
is evident from the responses as 68% of the responses are in favor.
Q. 13. What means of advertisements persuades you the most to purchase a product?
Responses-
TELIVISION 64
RADIO 9
NEWSPAPER 5
INTERNET 12
MAGAZINE 2
[48]
Interpretation- As per the responses to the above question, TV is the most effective means
of media for advertisements in the consumer’s opinion. 70% responses are in favor of the
prior statement.
Q. 14. What do you think is the reason for the companies to choose celebrity endorsement
for promoting their products?
Responses-
EASY RECOGINITION OF
PRODUCT 15
CREATING BRAND IMAGE 29
TO BE ABLE INCREASE SALE
AND PROFIT 38
TO COMPETE STRONGLY 10
[49]
Interpretation- In views of the respondents, increasing sales and profit plus creating brand
image are the two main motives of the marketers behind celebrity endorsement. In total 73%
responses are in favor of the above statement.
Section 5
Aim of this section is to measure the consumer’s attitude for different brand endorsers and
different products of Coca-Cola. For this, two questions are designed. In these
questions, the respondent was asked to provide ranks to the options. (Likert five point
scale) (1 = poor; 2 = Fair; 3 = Good; 4 = Very good; 5 = Excellent)
Q. 15. Rank the following endorsers of Coca-Cola on five point scale:
Responses-
Rank 1 Rank 2 Rank 3 Rank 4 Rank 5
Amir 21 15 28 5 23
Aishwariya 6 21 17 29 19
Hritik 9 15 26 28 14
Imran 9 38 32 8 5
Karina 13 16 25 18 20
Akshay 10 27 22 22 11
Sachin 18 18 15 17 24
Asim 14 9 23 24 22
Interpretation- For mapping attitudes of consumer’s towards different brand endorsers of
Coca-Cola’s products, this question is framed. According to the responses, following can be
inferred:
Ashwarya, Hritik and Asim are the most loved endorsers by the consumer group.
[50]
Imran Kan is the least appreciated endorser of Coca-Cola.
Q. 16. Please rank the following soft drinks as per your preference on a five point scale:
Responses-
Soft Drink Rank 1 Rank 2 Rank 3 Rank 4 Rank 5
Coca-Cola 3 5 6 35 43
Diet Coke 4 8 15 28 37
Thums Up 6 10 21 27 28
Sprite 9 11 19 24 29
Fanta 5 12 20 16 39
Limca 1 5 16 29 41
Maaza 2 13 20 27 30
Maaza Milky Delite 6 15 25 30 16
Minute Maid Pulpy Orange 4 12 20 32 24
Minute Maid Nimbu Fresh 1 3 8 20 60
Interpretation- For mapping attitudes of consumer’s towards different brands of Coca-Cola,
this question is framed. According to the responses, following can be inferred:
Minute maid Nimbu Fresh has gain the most popularity as it is the most preferred
brand among the respondents.
Coca-Cola is the oldest and the most loved brand.
Mazza Milky Delite is the least appreciated brand among the respondents.
[51]
4.2 Findings
Coke is found to the most popular soft drink brand among the Indian soft drink
consumers. All though the consumption of soft drinks in India is not that frequent as it was
the case in the western countries. Yet soft drinks are a content of weekly or daily
consumption basket of the Indian consumers. Soft drinks are quite popular in India. Among
Indians, soft drinks are the means of satisfying the quench and maintaining status. Soft drinks
are too consumed as an add-on to food or alternate of water.
There lies a significant spending habit difference in the Indian consumers. This
disparity of spending is due to the income and living status differences among the consumers.
Also difference exists because of the demographic factors. The most enticing factor for
consumer’s purchasing a soft drink is the taste and the brand name. Celebrity endorsement is
not their concern. Price is another factor which effect consumer’s buying decision.
Indian consumers do not perceive that products endorsed by any celebrity are of high
quality. Also by introducing celebrity endorsement product become more costly. Celebrity
endorsement is proved to be the strategy for reaping higher revenues in the consumer’s
views. Only few purchase decisions are driven backed by a celebrity endorsement. It is found
that for a small value product the impact of celebrity association is not much on the purchase
decision. Consumers believe that the celebrities themselves do not use those products which
they endorse.
Cricketers and film stars are the most appreciated celebrities for influencing the
purchasing decision of the consumers.
Before making a purchase decision of high valued products like white goods,
automobiles etc, brand name and the associated celebrity endorser are the two factors that
people consider. But it is not the case for food and beverages articles. The most alluring
factor for purchasing such products is the taste. Although there exist a high involvement of
general public with the celebrities but at the same time value for money is one of the key
concerns. Majority of respondents believe that celebrity endorsement is an efficient mean of
influencing i.e. it helps conveying the message to the targeted audience with clarity about the
product offerings and convince them to purchase.
In country like India where Cricket is treated like a religion and the cricketers are
adored as God. Sports stars are found to be much admired by people as better celebrity
character than the bollywood actor or actress.
[52]
The results of brand recall were surprising as most no. of people were able to
recognize the celebrities endorsing the given advertisement. So it showed that celebrity
endorsement is a source of developing brand recognition.
Most of the respondents were found to be impressed by their favorite personalities
being in the television ads and the impact was fairly high. There exists a relationship between
the age of the consumer and choice of endorsers they like most. Attractiveness of a celebrity
is the most influencing factor for the success of the particular advertisement. Young
consumers are to a great extent interested watching sports personality endorsing in TV
commercials. Celebrity endorsement is a source of glamour. The TV commercials are the
most effective means of media for the celebrity endorsement strategy.
A sheer relationship has been observed between the soft drink consumer’s buying
decision and the celebrity endorser fot the drink in India. Also from the analysis, It is evident
that different factors influence consumer’s buying decisions like the brand name and image,
the taste, etc.
As a result of the current study, it is clear that the Indian soft drink consumer has an
overall affirmative attitude for celebrity endorsements, and it assist in increasing the product
awareness and it supports the brand recall frequency. The demographic factors such as age,
gender and family income has an impact on the consumer purchasing behavior. It is observed
that the celebrity endorsement strategy is just a mean of recognition and recall a product.
This study has found that celebrity endorsement augments product information and
creates awareness among consumers. It helps them to recall the brands which they endorse.
The purchase attitude is inequitable by the celebrity endorsement factors, brand recognition
and product evaluation. It keeps the brand image on the consumers. Only a less number of
consumers have a preference of using products by seeing celebrities. It just increases the
consumer’s concentration and grasps their notice towards the ads. The consumers buying
behavior also get influenced by multiple celebrities endorsing a single brand. Finally the
celebrity endorsement has the direct constructive effect towards the advertisement and the
brand image.
In views of the respondents, increasing sales and profit plus creating brand image are
the two main motives of the marketers behind celebrity endorsement. Attitudes of consumer’s
towards different brand endorsers employed for Coca-Cola’s products, is positive.
Aishwariya, Hritik and Asim are the most loved endorsers by the consumer group. Imran Kan
[53]
is the least appreciated endorser of Coca-Cola. Sachin Tendulkar is the most appreciated
endorsers among the sports stars by the Indian soft drink consumers.
Among different brands of Coca-Cola, Minute maid Nimbu Fresh has gain the most
popularity in the shortest time. Coca-Cola is the oldest and the most loved brand. Mazza
Milky Delite is the least appreciated brand among the respondents. Burn has no recognition
among the general Indian consumers.
Brands should carefully make sure the probabilities of the success of celebrities
towards endorsing the product. This will be the best approach to match the product type with
the probable celebrity field. The Multiple celebrities use for the advertisement, sometimes,
confuses the consumers and presents negative impact. So the organization must be careful in
adoption of multiple celebrity endorsement strategy. The chief decisive factors for the
selection of Celebrity Endorsement are Credibility, Attractiveness and match up. These are
the most important aspects of consideration for the success of an advertisement. Celebrity
endorsements are more effective when consistently used over time for creating the link
between the brand and the celebrity. They would be more effective when using a celebrity
who is not strongly associated with another product or service. Celebrity endorsement
strategy enhances product knowledge and creates awareness amongst the consumers.
[54]
CHAPTER 5: DISCUSSION OF FINDINGS This chapter discusses the various findings of the current study. The discussion is
segregated in five primary sections in accordance with the data analysis section. Findings
from each section are discussed separately. Finally, all the findings will be clubbed and its
implications to the case will be given. The 50-bn-rupee soft drink industry in India is growing
at the annual rate of 6 to 7%. Around 95% market share is being occupied by Coke and Pepsi
combined through franchisees or by self presence. Campa Cola is having 1% share, and the
rest is divided among the local players. In India, about 110 soft drink producing units (60%
being owned by Indian bottlers) are running, providing employment to about 125,000
people. This market further segregated in two distinct segments such as cola and non-cola
drinks. 62% share is claimed by the cola segment, while the non-cola segment includes drinks
with orange and mango flavors, cloudy lime, clear lime, and soda. Celebrity endorsements
have started a long time ago. The very fact is that their use has been continued for so long
which proves immense advantages attached to the strategy, but they too have disadvantages.
Considering this, the discussion is segregated in five primary sections in accordance with the
data analysis section. Findings from each section are discussed separately. Finally, all the
findings will be clubbed and its implications to the case will be given.
Section 1
Coke is found to be the most popular soft drink brand among the Indian soft drink
consumers. It reveals the popularity of the brand. Coke shares the highest market share in the
soft drink portfolio of the Coca-Cola India. But at the same time frequency of consumption of
soft drinks by Indians is not much. Coca Cola Companies should plan for enhancing
consumption in the country. This can be achieved through developing alternative need
satisfying features of soft drinks besides the traditional consumption needs. Most of the
Indian consumers go for a soft drink once in a week. The need to satisfy the quench or thirst
and maintenance of status symbol are the two basic utilities of soft drinks in India. These
consumers’ spending is very much dissimilar. This disparity may be due to the demographic
differences. Like a young would tend to spend more while a businessman would spend less
and would prefer other alternatives. For example an old person would prefer lemon juice or
class of water rather than a soft drink like coca-cola. Thus Coca cola is not famous among
[55]
senior citizens and therefore a plan should be made to target those consumers also by
endorsing celebrities like Amithabh bachan, Hema Malini etc.
Section 2
This section aims to clarify the opinions of the Indian soft drink consumers about the
celebrity endorsement strategy used by the advertisers. The most appealing factor for
consumer’s purchasing a soft drink is the taste, the brand name and its price. Indian
consumers are not much concerned about Celebrity endorsement. In reality Price is the main
factor which has an effect on consumer’s buying decision, as India is a developing country
and a huge percentage of people are under poverty line. In views of Indian consumers
sometimes celebrity endorsement does not guarantee the quality of a product. So there is no
sufficient credibility transfer from the celebrity associating to a product. This is also because
Indian consumers do not think that the celebrities themselves use the product, which they
endorse and celebrity endorse various products and the rival products are endorsed by another
celebrity thus giving Indian customers lot of choices. Besides that celebrity endorsement
proves to be a cost adding factor in the consumer’s opinion.
Section 3
Indian soft drink consumers and their response to the celebrity endorsement are quite
biased and complicated. Spending on celebrity endorsement, results in higher revenues
according to the consumer’s point of view. So the motive behind contracts with big
celebrities as a strategy results in generating huge revenues for the company. Majority of the
Indian soft drink consumers in India are encouraged to purchase by watching their favorite
celebrities endorsing the product. Cricketers and bollywood film stars are the most
appreciated celebrities for influencing the purchasing decision of the consumers. Hence
almost all soft drink companies endorse mostly Indian cricketers and bollywood film stars
Sachin Tendulkar, Saurav Ganguly, Hrithik Roshan, Aamir Khan, Kareena Kapoor etc.
Section 4
The conception of celebrity endorsement has turned into a fury in India as well, every
company trying to line in a brand ambassador for their brands, and there is big tuff
competition among companies to grasp big celebrities for their brands. Our study reveals that
the importance of celebrity endorsement for the advertiser in consumer’s opinion is apparent.
This strategy is helpful in brand promotion and generating huge revenues. And that is the
[56]
reason that company is ready to pay huge amount to the celebrities for endorsement. The
most persuasive means of advertisement for the soft drink company is Television
commercials; the other means of advertisements are ads in newspaper, magazines, internet,
radio Fm etc. Increased sales and profits plus creating brand image are the two main motives
of the marketers behind celebrity endorsement. Celebrities transfer traits of their personalities
to the product by endorsement. There must be reflective impact of the celeb towards the
framed brand image.
Section 5
Although Coke is the most liked brand among the Indian soft drink consumers yet the
consumer’s preference varies when the time comes for comparison in between different
available brands. This section attempts to measure the consumer’s attitude for different brand
endorsers and different products of Coca-Cola. Aishwariya Rai, Hritik Roshan and Asin are
the most loved endorsers by the consumer group, whereas Imran Kan is the least appreciated
endorser of Coca-Cola even though he was signed by the Coca Cola so that he could
represent the Indian youth. Sachin Tendulkar is the favorite endorser among the sports stars
in India, as he is been treated as God of cricket by Indian fans. Minute maid Nimbu Fresh has
gain the most popularity in a short span of time as it is the most preferred brand by Indian
consumers. Coca-Cola is the oldest and the most loved brand. Mazza Milky Delite is the least
appreciated brand and is not famous in Indian market, this may be due to no big celebrity was
endorsed in it.
Celebrity endorsement has been proved to be a goldmine or a minefield for any
company’s brand construction process. Celebrity endorsement has fared well in some
specific consumer segments while it has failed in others. Some celebrities have been much
flourishing than those with more or less equivalent fame. Thus the job of celebrity
endorsement in the ad space is ambiguous and can’t be seen as a guaranteed strategic
instrument for better profits, revenues, market share, etc. For example, Imran Khan as a
Coca-Cola endorser was not much successful while he fared good for Signature’s re-
establishment.
Indians feel affection for their favorite celebrities and blindly pursue their suit. This
love for the celebs has proved like a boon for the advertisers and celebrity endorsement is
presently getting improved by the day. It has at present become an unavoidable part of a
marketing communication strategy. Spending trend on the celebrity endorsement strategy
[57]
is going up year by year in Coca-Cola. It is a win –win game for both the brands and the
celebs. However, the consumers are the ones who get least benefitted as they have to pay
more for the products and services. Besides that, many a time’s consumers get cheated by
misrepresentation or miss leading endorsements. Consumers are losing faith in brand
endorsers. Company needs to be rational for the spending on such strategies.
Conclusion
This entire study was carried out to for studying a relationship between celebrity
endorsements in advertisements and buying behavior of Indian consumers. Here in India,
image transfer model of celebrity endorsement is used. It has been observed that the Indian
soft drink consumers at this stage are not much influenced by the presence of a celebrity in
the ads of soft drinks. Indian soft drink industry is at the maturing stage of life cycle
having just two big players which are well established in the country. Celebrity
endorsement just provides brand recognition for new products. As far as the effectiveness
and impact of celebrity endorsement is considered for Coca-Cola, it is the observation that
Coca-Cola is an old and well established brand and holds a specific brand image in the
Indian consumer’s mind so it itself does not get much affected by the celebrity
endorsement but other products of the company’s portfolio like minute maide Nimboo
Fresh and other new launches would definitely have reaped benefits by this strategy. In
Coca-Cola India the spending trend is rising by time following the pace of the advertising
industry.
[58]
CHAPTER 6: RECOMMENDATIONS AND LIMITATIONS The world of today is changing at fast speed. India is no exception to it. Particularly
following the opening up of the economy, the speed of change that India and its populace are
experiencing in their socio-cultural background is mind boggling. India has a wide diversity
that offers a mesmerizing scope for study. In the jest of change, marketing strategies are too
getting better and improved communication and positioning tools. One among these is
celebrity endorsement. Current study includes the Indian soft drink industry and specifically
concentrates on the Indian soft drink giant Coca-Cola India. Use of celebrity endorsement as
a communication and promotional strategy has gain popularity among the advertisers in
India.
Further, recommendations for company i.e. Coca-Cola is to be rational in spending on
and selection of the celebrities for product endorsement. Also Celebrities are not that much
influential for Indian consumers so enormous spending may be just a waste.
Results of this study are applicable to the Indian population. For a global impact
assessment of this strategy on consumer buying behavior, this study provides a ground. Also
Coca-Cola is a global brand rather being a local Indian one, so further research areas are
available in the concerned company. Further similar to soft drink industry other consumable
product industries can be studied under the same strategy.
Limitations
Although this research was prepared carefully, some limitations and shortcomings
still exist. First of all, the research results suffer from the time constraints as there was a
shortage of time. Second, the population of the experimental group was large enough and,
only 92 responses were taken for the study, which may not be a true representative of the
population. Third, since the questionnaire designed to the responses of the Indian consumers
was a closed ended one so the responses may not be fully free from the researcher’s
subjectivity. Besides these following limitations too exists in the study:
Constraint of resources is another limitation of the study.
Also because of the limited time, study may not be entertained with proper
enthusiasm as the topic is supposed to be. This research is completed in the
previously defined time slot which affects its trustworthiness, it requires more
time for the purpose of the research.
[59]
Thoughts and views of different authors is used in the LR section of the report.
These may be contradictory at times.
Respondent have not provided the answers with authenticity, which also acts as
the limitation of the research.
Some data is collected through the secondary sources where the observations of
the authors may be biased or not related to the study.
Generalization of the findings of the study is not feasible as this study is carried
out for a limited area or region also by using small sample, that is why the results
may be misleading.
Location constrain, research is based only at London which is far away from the
actual research population.
This research project measures the past not the future, thus there is no prediction
for future made in this project.
Market research provides information upon which decisions are made and does
not make decisions itself. Report findings do not make decisions just shows the
findings.
There are choices of techniques that are used but sometimes the techniques are
insufficient for the tasks that have been put.
The research is much reliable on secondary data.
[60]
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[65]
APPENDIX A QUESTIONNAIRE
Consumer demography
Name
___________________________________________________________________________
Contact numbers
Place__________ ______________
______________________________________________
Email address _______________________________________________________________
(Please tick one option)
Gender: Male Female
Age: 13-19 20-30 30-40 40-50 50 and Above
Occupation: Service/Business Housewife
Student Others (Please Specify)_______________________________
==================================================================
Study specific Questions
Q. 1. which soft drink do you prefer?
_________________________________________________________________________
Q. 2. How often you have soft drinks?
a. Daily b. Wealky
c. Once in a month d. On special occasions.
Q. 3. For you, having a soft drink is:
a. satisfying the quench b. status symbol
c. add on to food d. Alternate of water
Q. 4. What is your monthly spending on soft drink?
a. Less than Rs. 100 b. Rs. 100 to 500
c. Rs. 500 to 1000 d. More than 1000
Q. 5. What is the most persuading factor for you to purchase a soft drink?
a. Taste b. Price
c. Brand name d. Celebrity endorsing the product
Q. 6. Do you think that the products particularly advertised by celebrities are of good
quality?
a. Yes[66]
b. No
c. 50%
d. Not sure
Q. 7. Do you believe that celebrity endorsements make the product costlier for the
consumer?
a. Yes
b. No
c. 50%
d. Not sure
Q. 8. Companies invests large amount of money for celebrities endorsement; do you
think it’s worth for increasing their revenue?
a. Yes
b. No
c. Don’t know
Q. 9. Do you feel encouraged for purchases due to the presence of celebrities like
Shahrukh Khan, Amitabh Bachan or Aishwariya Rai in an advertisement?
a. Yes
b. No
c. Don’t know
Q. 10. Do you think the celebrities also use those products which they endorse?
a. Yes
b. No
c. Don’t know
Q. 11. What type of celebrity endorsement persuades you personally to purchase
products?
a. Film star
b. Famous personalities
c. Cricketer
d. Politician
Q. 12. Does celebrity endorsement help in brand promotion?
a. Yes
b. No
c. Don’t know
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Q. 13. What means of advertisements persuades you the most to purchase a product?
a. Television b. Radio
c. Newspaper d. Magazines
e. Internet
Q. 14. What do you think is the reason for the companies to choose celebrity endorsement
for promoting their products?
a. Easy recognition of product
b. Creating brand image
c. To be able to increase sales and profit
d. To compete strongly
Q. 15. Rank the following endorsers of Coca-Cola on five point scale:
Celebrity Ranking
Amir khan
Aishwarya Ray
Hritik Roshan
Imran Khan
Kareena Kapoor
Akshay Kumar
Asin
Sachin Tendulkar
Q. 16. Please rank the following soft drinks as per your preference on a five point scale:
1 = poor; 2 = Fair; 3 = Good; 4 = Very good; 5 = Excellent
Soft Drink Ranking
Coca-Cola
Diet Coke
Thums Up
Sprite
Fanta
Limca
Maaza
Maaza Milky Delite
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Minute Maid Pulpy Orange
Minute Maid Nimbu Fresh
Burn
Kinley Water
Kinley Soda
Thanks.
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