CELEBRITY ENDORSEMENT Can personality help solve the puzzle Copenhagen Business School, 2013 Cand. Merc. - Marketing Communications Management Master’s thesis Handed in the 20th of November 2013 Supervisor: Anne Martensen Pages: 120 pages (259.572 STU) Nikolas Vaage-Nilsen Sebastian Skov Evald Executive summary Celebrity endorsement is a marketing tool that is increasingly being used by marketers to grab attention and connect with consumers. However, until now researchers have not provided a conclusive picture of how celebrity endorsement works. Most researchers, within the literature, agree that there needs to be a “natural fit” between celebrity and brand for the endorsement to be effective. It has been argued that personality is one of the main attributes for creating such fit. However, no empirical tests have been undertaken to examine this matter, nor has the consumers’ part been taken into account. Thus, this thesis examines how a personality fit between celebrity-brand-consumer may lead to more effective celebrity endorsement. This matter has been examined for the high involvement affective product category, within the Western culture. A conceptual model has been theoretically accounted for, which illustrates how personality fit affects advertisement attitude, brand attitude and brand uplift. The model has been tested by use of a quantitative online survey, to which qualitative measures was utilized to heighten the validity of the survey. The model has been statistically supported and results further indicate that the greater the personality fit, the greater the effect on brand uplift. Further, the results indicate that if a celebrity with a low personality fit is used; such advertisement may actually be less effective than if an unknown model was used. As such, celebrity endorsement has been found to be both effective and non-effective, based on the conditions by which it is used. This emphasizes the need for marketers to be aware of the factors that help create effective celebrity endorsement, wherefore thorough testing of potential endorsers is advised. To this end, the model established by this thesis may, along with other important attributes, be used as a guideline for measuring the potential of an endorser. A model has further been discussed in regards to how to identify what is missing in a given celebrity endorsement relationship. Although not tested, this model may provide others inspiration for further investigating of how personality fit may affect endorsement effectiveness. Personality fit – an important piece of the puzzle. Preface Through months of hard work we have written, re-written, discussed and elaborated each section of this thesis, in close collaboration with one another. For this we would like to thank one another for an interesting journey through this process and its complementary learning curve. We would further like to express our gratitude to our supervisor Anne Martensen for her guidance and patience with our numerous questions and tendency to question any method and angle. Furthermore, we would like to thank our expert interviewee, our six focus group participants and our 371 survey respondents for their cooperation and for dedicating their time to answer our questions. Finally, we would like to extend or sincerest apology to our employers, friends and family for being both physically and mentally absent during this process. We thank you for your support and patience. Nikolas & Sebastian Abbreviations Ic = Involvement with celebrity Ib = Involvement with brand Ab = Brand attitude Aad = Ad attitude BU = Brand uplift Pfit = Personality fit Pceleb = Celebrity Personality Pcon = Consumer Personality Pb = Brand personality JS = John Smith GC = George Clooney HG = Hugh Grant Definitions A celebrity endorser is defined as an individual who is in the public limelight and uses this recognition on behalf of a consumer good by appearing with it in advertising. Further, that the celebrity receives monetary compensation for this, which consumers are aware of. Please note that this thesis will refer to the consumer as a male, even though the consumer could naturally likewise be female. Table of Contents 1 Introduction ..................................................................................................... 1 1.1 PROBLEM STATEMENT ..................................................................................................................................... 3 1.1.1 Delimitation ........................................................................................................................................... 4 1.2 SCIENTIFIC APPROACH ..................................................................................................................................... 6 1.2.1 Concerns ................................................................................................................................................ 7 1.3 COMPANY IN FOCUS ......................................................................................................................................... 8 1.3.1 Reasoning for choosing Rolex ............................................................................................................... 9 1.3.2 Considerations ..................................................................................................................................... 10 1.4 STRUCTURE .................................................................................................................................................... 11 2 Theory............................................................................................................. 12 2.1 BRAND IMAGE ................................................................................................................................................ 13 2.2 CONSUMER BEHAVIOR ................................................................................................................................... 19 2.3 CELEBRITY ENDORSEMENT ............................................................................................................................ 25 2.4 THEORETICAL REFERENCE POINT ................................................................................................................... 33 2.5 CONCEPTUAL MODEL ..................................................................................................................................... 53 2.5.1 assumptions of the conceptual model .................................................................................................. 63 3 Methodology .................................................................................................. 65 3.1 QUALITATIVE METHOD .................................................................................................................................. 66 3.1.1 Focus group ......................................................................................................................................... 66 3.1.2 Expert interview ................................................................................................................................... 69 3.2 QUANTITATIVE METHOD ................................................................................................................................ 72 3.2.1 Online Survey ....................................................................................................................................... 72 4 Results ............................................................................................................ 79 4.1 DATA PROCESSING ......................................................................................................................................... 79 4.2 SAMPLE VALIDITY .......................................................................................................................................... 80 4.3 THE CONCEPTUAL MODEL .............................................................................................................................. 83 4.4 BEYOND THE PROPOSED HYPOTHESES’........................................................................................................... 88 4.5 OTHER FACTORS ............................................................................................................................................ 92 5 Discussion ...................................................................................................... 94 5.1 THE ESTIMATED MODEL ................................................................................................................................. 94 5.2 OTHER FACTORS AFFECTING EFFECTIVENESS ............................................................................................... 100 5.3 FURTHER DISCUSSION OF PERSONALITY FIT ................................................................................................ 103 5.3.1 Identification ...................................................................................................................................... 104 5.3.2 Credibility .......................................................................................................................................... 105 5.3.3 Self-expression ................................................................................................................................... 106 5.3.4 the different forms of celebrity endorsement congruency .................................................................