Table of Content ABSTRACT.
. 2 CHAPTER ONE: INTRODUCTION.. 3 Introduction. 3 Background of Study. 4 Objectives of the Study. 7 Research Questions.
8 Hypothesis of the study. 8 CHAPTER TWO: METHODOLOGY.. 9 Dependent and Independent Variables. 9 Research Design. 10 Study population.
10 Research Instrument 11 Questionnaire Design. 11 Pilot Testing. 12 CHAPTER THREE: METHODOLOGY AND ANALYSIS. 13 Introduction. 13 ABSTRACT Recent years have portrayed that many companies globallyhave experienced growth and improvement in their marketing especially in theform of celebrity product endorsement.
Malaysian consumers has shown a highinterest in product used by celebrities of the country. This paper will befocusing on the study on the effect of celebrity product endorsement on youngMalaysian consumers. The study was conducted by the research in Malaysia; BukitJalil. The objectives of this study is to explore the relationship between valueadded brand equity, consumer purchasing decisions and product congruency withcelebrity product endorsement, to identify the factors that affect or influencecelebrity product endorsement and to compare the effect of celebrity productendorsement on young consumers in Malaysia. A discussion on the problemstatement of this study will be outlined in chapter one after a thoroughanalysis of the research question. CHAPTER ONE:INTRODUCTIONIntroduction The purpose of this research paper is to study theoverall perception on celebrity product endorsement on young consumers here inMalaysia. The study would also focus on studying value added index on brandequity, consumer purchasing decisions and product congruency with the celebrityendorser and see if the three aforementioned elements have a perception oncelebrity product endorsement.
The end results of this research have greatimportance on the promotion strategies adopted by commercial firms in productmarketing their branded goods and/or services. This research can also provideimplications on the impact of celebrity endorsement and its advertising ondeveloping nations around the world. Finally, this research could also addvalue on educating young consumers into good decision making choices beforepurchasing a product in the market.
Background of Study One of the major and most commonlyused strategy in advertising nowadays by commercial companies is via celebrityendorsements. The reason behind such an adoption is because in a perfect marketcompetition where products appear to be similar but can only be differentiatedby the strength of a brand name is to use an external force of public emerge ofa celebrity (Chan, Leung Ng and Luk, 2013). Therefore, in order to create a biggap between rivalry companies in the same industry is to strength the brand nameof a particular product. The competency here is to outdo ones rivals by holdingon a grip of good and effective competitive advantage in the industry throughaggressive celebrity endorsement advertising (Spry, Pappu and Bettina Cornwell,2011). Thus, when advertising is beingconducted, commercial companies immaculately pick out endorsers so as toamplify the characteristics of their branded products in the market. Ten yearsago, out of three advertisements aired on TV, one had a feature of celebrity endorsement.
In the recent years, celebrity endorsement advertisements have appeared vastlyon all media. Not only is the appearance done on TV’s, but as well as socialmedia platforms like Facebook ads, Instagram and YouTube ads. In United Statesalone, about a fifth of all TV commercial feature a celebrity and about a tenthof the money spent on TV advertisements alone is spent on celebrityendorsements (Akturan, 2011).Creating an emotional bond withadverts through endorsements is yet another strategy adopted by endorsing firmsfor branded products. This link of affiliated boding to the product creates amemory in the heads of consumers and boosts their easiness in product decisionmaking strategy, product efficiency data mining, and product recommendation toother consumers (Jain and Roy, 2016). This can be widely be seen in thefollowing international brand products with their international celebrityendorsers; David Beckham with Giorgio Armani, Tyra Banks with Victoria Secrets,Angelina Jolie with Lóreal and Charlize Theron with Dior.Crossing borders to Malaysia,celebrity endorsement has not been left behind.
Various celebrities have beenused to endorse a particular product or brand. The purpose of such endorsementis to effectively increase consumers’ belief and credibility on the sale of aproduct. Associating the branded product to an endorsed celebrity helpsconsumers remember the product easily and thus create a bond between safepurchasing with the product.
Thus, in order to create such a product bondingwith the customers, the localized customers need to be familiar with theassociated endorsed celebrity (Hassan Fathelrahman Mansour and MohammedElzubier Diab, 2016). Below is a list of some of the common featured Malaysiancelebrities to a brand name or product. Table1:Table constructed by researcher for the purpose of the study Celebrity Brand name Siti Nurhaliza Simplicity, Pepsi Nur Fazura Neffos X1 Smart phone Nora Danish Owl (Head Scarfs) Fahrin Ahmad AliCafe Aaron Aziz Dutch Lady Fizo Omar F&N (condensed milk) Yunalis Mat Zara’ai Calpis (drink) Scha Alyahya Rexona, Yakult According to a research conducted byBoris, Alexandra and Damijan they explain perceived quality as bridging betweena brand product and consumers via celebrity endorsement. This is becauseconsumers tend to believe and remember the product quite easily as well ashaving a concluded perception that the product is of high quality (Snoj, PisnikKorda and Mumel, 2004). Thus, managers of brand product can even rise theprices of such products and consumers will be willing to buy regardless of theinsensitive price increase; inelastic demand.
Moreover, consumers envision celebritiesas an important and idolized reference group to anything revolving around themarket with respect to fashion trend and luxuries. This idolization is bornedue to the fact that the celebrity is famous, rich and most of the timeattractive. The notion of attractiveness is lined with sex appeal, physiquesand beauty/handsomeness (Silvera and Austad, 2014). Charlize Theron for exampleearned $2 million USD every year on a three years contract signed under Diorperfume. Her nomination and selection on this advert was based on her beauty,sexiness and TV and acting personality. This increased the sales of Diorperfume; J’Adore by double in a year (CBS News, 2017).
Celebrities are as well used as thespokesperson of a product in the market. This endorsement can at times be ofmore than one type of product brand name. The reason behind such an associationtells the consumers that the endorsed celebrity has a very close affiliation tothe product brand and is well versed to the effectiveness and efficiency of theproduct satisfaction and functionality. Thus, this creates assurance at thehearts of the consumers and give in easily when it comes to product purchasingdecision making (Hsu and McDonald, 2002).
For example, Siti Nurhaliza has beenthe ambassador of L’Oreal and Vivo 5 mobile and Ziana Zain taking great toll onbeing a spokesperson for Golden Chanel Jewellery.Celebrity endorsement advertising hasso far been concluded as the best and most effective marketing strategy to beadopted by firms. As such, many commercial companies and firms worldwide arevery ready to set aside bulk of their capital in investing on endorsements.This is because they believe that it possess the aptitude of getting thecomplete consumer’s attention and luring them into ultimate buying withoutreluctance (Rollins and Bhutada, 2014). From 2010, Nike Company signed an eightyear contract with the worldwide renowned tennis player Maria Sharapova as theface endorsed on Nike Products and accessories. The deal was sealed at a networth of $70 million USD. This was historically the first world’s richestendorsement to be signed for a female athlete.
Nike believes that this willreap the company benefits in the coming years immediately after the incrementalrevenues which is realised from incessant sales exceeds the contractual feeexpense (Melbourne, 2017). As much as celebrity endorsement istaking a quick toll in advertising brand name products, there is less availableinformation about what is the implication on celebrity product endorsementespecially on young Malaysian consumers. Does the celebrity endorsement add anyproduct value to the brand equity of a product being sold in the market? Also,are celebrity endorsement adverts effective towards consumer’s purchasing decisions?And finally, does product congruency affect the effectiveness of a brandproduct in young consumer’s purchasing ability? These questions are empiricallyimportant because there is less published information regarding this issue.Objectives of theStudy The objectives of the study are as follows:1. Toexplore the relationship between value added brand equity, consumer purchasingdecisions and product congruency with celebrity product endorsement2. Toidentify the factors that affect or influence celebrity product endorsement3. Tocompare the effect of celebrity product endorsement on young consumers inMalaysiaResearch Questions The following are the research questions for thisresearch paper;1.
Whatis the relationship between value added brand equity, consumer purchasingdecisions and product congruency with celebrity product endorsement?2. Whatfactors affect or influence celebrity product endorsement?3. Whatis the comparable effect of celebrity product endorsement on consumers inMalaysia based on their gender biasness? Hypothesis of the study The proposed research hypothesis for this study is asfollowed based on the variables of the research paper:Table 2:Hypothesis HA H0 A There is no significant relationship between celebrity product endorsement and value added brand equity H1 A there is a significant relationship between celebrity product endorsement and value added brand equity HB H0 B there is no significant relationship between celebrity product endorsement and consumer purchasing decisions H1 B there is a significant relationship between celebrity product endorsement and consumer purchasing decisions HC H0 C there is no significant relationship between celebrity product endorsement and product congruency H1 C there is a significant relationship between celebrity product endorsement and product congruency HD H0 D brand equity is not a significant factor H1 D brand equity is a significant factor HE H0 E consumer purchasing decision is not a significant factor H1 E consumer purchasing decision is a significant factor HF H0 F product congruency is not a significant factor H1 F product congruency is a significant factor HG H0 G there is no significant difference about celebrity product endorsement among different ages of consumers H1 G there is a significant difference about celebrity product endorsement among different ages of consumers Dependent andIndependent Variables In this paper, the independentvariable which is the variable on test manipulated by the researcher as theantecedent cause are value added on brand equity, consumer purchasing decisionsand product congruency. On the other hand, the dependent variable which is thevariable that is just placed on observation and is only measured as aneffectual result of the measurement retrieved from the independent variables iscelebrity product endorsement. Figure1:Relationship between Dependent and Independent Variables(Source:Made for the purpose of the research) Research Design This research at its final outputwill conclusively make a study on the effect of celebrity product endorsementon young consumers in Malaysia.
This research will be a quantitative in natureas questionnaires will be issued as a primary data basis. Klang Valley will bethe most succinct place to conduct this research as it is a metropolitan city.Under this study, the definition of young aged Malaysians are persons with agebracket of 15 years to 30 years.Study population The population will consist of anaudience of Malaysian origin around the vast vicinities of Klang Valley. Underthis study, a sample size of 200 will be effective to draw out conclusiveclauses on the hypothesis proposed in the previous chapter above.
Research Instrument This study will conclusivelysubjected to a self-administered questionnaire which will be issued torespondents online via Google Docs on Facebook platform and the feedbacks willbe collected back from them through the same process. The construction of thequestionnaire will be self-designed since no apparent questionnaire existed tofit the tested independent variables for this study as well as for the studypopulation. Below is a description of the questionnaire. Questionnaire Design Generally, the questionnaire willconsist of five main sections namely A, B, C, D and E.
the questionnaire willbe written in English language and will be a closed ended type ofquestionnaire. This means that, all the respondents will be subjected inchoosing the enclosed answers in the questionnaire except for section A. Thepurpose of doing such is because it will be easier for the researcher tocollect and analyse the data collected from the respondents as the margin ofdifference in their responses will be null. Any question left unanswered willcompletely nullify the whole questionnaire and thus it will be consideredinvalid for analysis.
Below is a description of the sections enclosed in thequestionnaire and their functionalities; Pilot Testing A pilot test will be conducted by theresearcher before the real survey where 10 mock questionnaire will be issued.This is to minimise the errors that might arise from the design of thequestionnaire as well as to set a control on the authenticity of the projectedquestions in the questionnaire. If inconveniences should arise regarding thevalidity and nature of the questionnaire from the respondents’ side, then thequestionnaire will have to under-go a reconstruction so as to meet theobjective of this research. CHAPTER THREE: METHODOLOGY AND ANALYSISIntroduction Inferential analysis is the mostwidely used quantitative method to test the hypotheses.
If there is any drawnconclusion, it must be in a probabilistic method. It also can be used to checkthe reliability of an argument and explain the research phenomenon. Independentt-test, one-way ANOVA, Pearson’s Correlation Coefficient Analysis and MultipleRegression Analysis are going to be applied in this study under this chapter. In this study various statistical tests will beconducted to accept and/or reject thehypothesis drawn in this paper. The test which were put into test wereindependent t-test, one-way ANOVA, multi-linear regression and Pearson’scorrelation. All these tests will be ran in SPSS20 where the results of it canbe seen in chapter four of this paper. A number of 200 questionnaires wereissued to come up to the arrival of this test conduction where only 120questionnaires were fully and correctly answered.
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