INFLUENCE OF CELEBRITY ENDORSEMENT ON CONSUMER

PURCHASING BEHAVIOR ON NEPALI SHOE BRAND

Submitted by
Phalina Bajracharya
ShankerDev Campus
Exam Symbol No.: 277/15
TU Regd. No.: 7-2-142-4-2010

A Research Proposal Submitted To

University Grant Commission
Nepal

In partial fulfillment of the requirements for the degree of

Master of Business Management (MBM)

February, 2017
 TABLE OF CONTENTS
Chapter one.............................................................................................................................1

Introduction............................................................................................................................1

1.1 Background of the study......................................................................................1

1.2 Statement problem...........................................................................................2
1.3 Research question............................................................................................2
1.4 Objectives of the study....................................................................................2
1.5 Theoretical framework....................................................................................3
1.6 Research hypothesis........................................................................................4
1.7 Justification of the study..................................................................................4
Chapter two.............................................................................................................................5

Literature review....................................................................................................................5

2.1 Celebrity..............................................................................................................5
2.2 Celebrity Endorsement....................................................................5
Chapter Three.........................................................................................................................7

Research methodology............................................................................................................7

3.1 Research design...................................................................................................7

3.2 Sampling size.................................................................................. 7
3.3 Sampling technique........................................................................7
3.4 Source of data................................................................................. 7
3.5 Data management and analysis......................................................7
3.6 Expected output.............................................................................. 8
3.7 Research Ethics............................................................................... 8
3.8 Limitations of the study..................................................................8
3.9 Delimitation of the study.................................................................8
3.10 Time table..................................................................................... 9
3.11 Detail budget................................................................................ 9
3.12 Summary..................................................................................... 10

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 CHAPTER ONE
INTRODUCTION

1.1 Background of the study

Celebrity endorsement nowadays has become very popular means for promotional
campaigns. It has become trend and perceived as formula for product marketing and
brand building. Companies they use celebrity who have reputation, fame and who can
easily influence people such as movie stars, singers, athletes and comedian to endorse
the product in order to attract consumers. A celebrity endorser is any individual who
enjoys public recognition and who uses this recognition on behalf of a consumer good
by appearing with it in advertisement McCracker(1989). Celebrity endorsement
influences brand image through transfer of meaning from the endorser to the brand. It
establishes the connection between the image of the celebrity and the image of the
brand. A well-recognized personalities having strong impressive power to attract
audience by their likeliness, creditability, attractiveness with the brand which will
create strong brand image and value towards consumers.

Celebrity endorsement has changed the way of doing advertisement. It has not only
created positive vibes bur also has gain huge popularity. Although celebrity
endorsement is expensive form of advertisement but it has contributed to earn profit.
When celebrity endorses a product his/her fans take it as a part of his/her trend.
Celebrity image are generally high and no matter how less valued the product it is
adds up certain value in the mind of the customer.

Nepali society has always been influence from Indian culture. The two countries share
open border and many similar cultural. Its the reason that Indian celebrity used to
endorse various products in Nepalese market too. Besides it also make cheaper for
promoter to use same advertisement or celebrity for multinational products. However,
at present some Nepali celebrity also endorse various products as well.

The market for Nepali shoes brand are continuously growing. The demand for made
in Nepal shoe has gain much more popularity. Currently Nepalese market is soared
with many Nepali shoe brands such as Shikhar shoes, BF Deehill, Goldstar, Fitrite,

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Sky shoes etc. The reason for gaining market is because of high quality at cheaper
affordable price compare to international brands. Promoters of footwear brand have
been using different means of promotional campaign including celebrity endorsement.

Therefore, this research is conducted to study the influence of celebrity endorsement

in consumer purchasing behavior in context to Nepal. Previous study supported that
celebrity endorsement have positive influence on purchasing behavior but whether it
is equally effective in terms of Nepali market or not it is not clear. Till now there is no
study conducted on influence of celerity advertisement on local product and local
market.

1.2 Statement problem

Celebrity endorsement is very powerful advertisement technique for creating
awareness and gaining favorable response. However even though celebrity has
become the most common advertising promotion marketer still doubt if it is
successful and effective marketing strategy. The thesis on influence of celebrity
endorsement seems to be relatively more than other topics in comparison but there is
no such study done in context to local endorser on local market. Therefore this study
is an effort to explore influence of celebrity endorsement in purchasing behavior in
context to Nepali brand.

1.3 Research question

Does attractiveness, trustworthiness, image and popularity of celebrity
influence on purchasing behavior of consumer?
Do demographic variables like age, gender and income of consumers
influence on purchasing behavior?
How far celebrity endorsement has an impact on the purchase decision?

1.4 Objectives of the study

The objectives of the study are as follows

To study whether or not consumer purchasing decision are in fact influence by

celebrity endorsement.
To assess the extent of influence created by celebrity endorsed advertisements
for Nepali brand shoe and to ascertain the consumer responses.
To examine the popularity of local celebrity who endorse shoe brands.

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 To study the level of awareness created by celebrity on shoes market.

1.5 Theoretical framework

The entire study of this research will be based upon three different types of variables
i.e. dependent variables (purchasing behavior), independent variables (attractiveness,
trustworthiness, popularity, and image) and moderating variables (age, profession, and
income).

Independent Variables

Attractiveness
Dependent Variable

Trustworthiness

Purchasing Behavior

Popularity

Image

Moderating Variables
Age
Profession
Income

Figure 1: Theoretical framework of Influence of celebrity endorsement on

purchasing behavior.
1.6 Research hypothesis
The research hypothesis is based upon the review of existing literature, the following
hypothesis are developed.

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 H1: There exists a positive relation between attractiveness of celebrity and
purchasing behavior.
H2: There exists a positive relation between trustworthiness and purchasing
behavior
H3: There exists a positive relation between popularity and purchasing behavior.
H4: There exists a positive relation between image and purchasing behavior.
H5: Age plays a moderating role on celebrity endorsed purchasing behavior.
H6: Profession plays a moderating role on celebrity endorsed purchasing
behavior.
H7: Profession plays a moderating role on celebrity endorsed purchasing
behavior.

1.7 Justification of the study

Nepali brands shoe market is growing industry. The demand for shoes is continuously
rising. Perhaps marketer of the shoes has been using different promotional campaigns
from trade fair to various advertisements to attract more and more number of
consumers. Celebrity endorsement is one of the major promotional campaigns that has
been practiced by the Nepali shoe brand marketers. Therefore the study of this
research will help the shoe marketer to understand to which extend celebrity has
influence on purchasing behavior of footwear consumer. Celebrity endorsement is an
expensive form of advertisement. It wills help marketer to analyze whether their
investments are in right track or monitor is there any contribution towards earring
profit. Further it will also help to understand general view point of respondent on
celebrity endorsement on Nepali footwear.

1.7.1

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 CHAPTER TWO
LITERATURE REVIEW

2.1 Celebrity
A celebrity is a person who is publicly recognized by a large share of a certain group
of people, and in the context of celebrity endorsement it is someone who is publicly
known for achievements in other areas than the product class endorsed. Celebrities are
further said to enjoy a high degree of public awareness and they generally differ from
the social norm in a corresponding social group. Attributes like special skills,
attractiveness and extraordinary lifestyle are examples and specific common
characteristics that are recognized. (Friedman & Friedman, 1979).

2.2 Celebrity Endorsement

"Celebrity endorser is an individual who is known by the public for his or her
achievements in areas other than that of the product class endorsed" (Friedman and
Friedman, 1979). Multinational organizations attachment of celebrities with their
brands is additional effort exerted in ads, in order to gain more popularity of the
product and its easy recognition for the purpose of purchase motivation. Intense
attachment with celebrities attracts the people and motivates them to follow the
celebrity (McCuthceon, Lange and Houran, 2002). On communication side, in China
a strong positive effect is created by celebrity endorsement practices (Gan, 2006).
Celebrities are inviters who invite the people to buy the product or service with
enormous power in Ads than any other due to their credibility and distinctive position
that leads towards intention to buy. In current marketing environment attention,
capturing towards Ads is also done by the endorsers, which produce positive results to
advertisement and greater purchase intentions (Brajesh and Gouranga, 2011).

According to Melissa St. James, a doctoral fellow and marketing instructor at The
George Washington University, "Studies show that using celebrities can increase
consumers' awareness of the ad, capture [their] attention and make ads more
memorable." Diverse literature is available on celebrity endorsement.

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Wenqian Gan (2006) explores the Chinese consumers behaviors toward celebrity and
non celebrity commercials. The results shows that Chinese consumers prefer Celebrity
commercial & respondents collectively like celebrity who have more professional
career skill, even though there are other different reasons existing such as good
appearances, good disposition, and good career spirit.

Erik hunter and Per Davidsson (2008) studied negative informations impact on
celebrity entrepreneurship. There results shows that negative information about the
celebrity might leads to negative attitude towards the new venture and promotion,
new ventures can potentially reduce damage to their brand by distancing themselves
from the celebrity, however, such a maneuver may not be as effective when the new
venture is run by a celebrity entrepreneur.

Farida Saleem (2007) Celebrity endorsement is becoming very prominent now a day.
Marketers use celebrities in ads when there is no or very little product differentiation.
When marketers have to target more diverse market multiple celebrities endorsement
(more than one celebrity in a single ad) could be an answer. The purpose of the
current study is to explore the perceptual difference of young adult toward single
celebrity ads and multiple celebrities ads. Questionnaires were administered on a
sample of 300 university students to asses if there is any difference in young adult
perception about single celebrity endorsement and multiple celebrities endorsement.
Four print media ads, two containing one celebrity in them and two containing three
and five celebrities in them were used as a stimulus. The results showed that the
attitude toward ad and purchase intentions are more positive for multiple celebrities
ads compare to single celebrity ads and there is no significant difference in the
attitude toward brand for multiple celebrities ads and single celebrity ads.

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 CHAPTER THREE
RESEARCH METHODOLOGY

3.1 Research design

The research design adopted for this study will be descriptive research which will be
based upon personal opinion of respondent about celebrity. Qualitative data will be
useful in determining the various factors on the theoretical model of research.
Therefore it forms the basis of analysis to interpret the perception of the respondent.

3.2 Sampling size

To examine the influence of celebrity endorsement on purchasing behavior the
sampling size will be about 200 respondents.

3.3 Sampling technique

The research will be conducted by using questionnaire which will be based on
influence of celebrity endorsement on consumer purchasing decision. A total 200
questionnaire will be distributed to respondents within Kathmandu valley who
purchase Nepali branded shoes.

3.4 Source of data

Both primary and secondary data will be collected for this research. The primary data
will be collected by questionnaire. The questionnaire consists of closed and open
ended questions. The format of questionnaire will be in structured questions,
classification questions, single response question, likert scale questions. The
questionnaire will be design to collect data about the influence of celebrity
endorsement on the consumers purchase decision. Whereas secondary data will be
collected from websites, journals, newspaper and magazines.

3.5 Data management and analysis

SPSS and Microsoft Excel will be used to analyze the collected data. The collected
data will then be interpreted through the suitable statistical tools like Ms-Excel and
documented on MS-Word. Firstly, the collected data will be coded in Excel for easier
and find the accurate data and then presented through the pie chart and bar diagram

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for comparative study. Chi-square, Anova, t-test, hypothesis testing, and correlation,
will be used in this study.

3.6 Expected output

From the study expected output will show to what extend consumers are influence by
celebrity endorsement and the effect of celebrity endorsement in purchasing behavior
of local footwear consumption.

3.7 Research Ethics

It is important in all research projects not to harm people or use the findings of the
research to harm them (Fisher, 2004). It is for this reason that the data which will be
collected in this research will be kept in private. The names of the respondents and
any other form of identification will be kept confidential. The age and gender of the
participants will only be included in other to be able to build a quick profile for the
participant and the ages were limited to age brackets. In the introductory section of
the questionnaire, the participants will be briefed on the scope and nature of this
research so that they will be aware of the objectives and consents of the research
before taking part.

3.8 Limitations of the study

The limitation of the study is:

Due to limitation of the time sample size is taken only limited and the respondents
will be only taken from within Kathmandu valley.
The research study will be only base on few variables.

3.9 Delimitation of the study

The delimitation of the study is:
The total of respondent will be limited to 200.
Respondent will be taken within Kathmandu valley.
The study will be only based on local brand shoe.
Questionnaire will be used for collecting data.

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3.10 Time table
S.N. Activities Days
1 Approval of the proposal 20 days
2 Information collection 10 days
3 Questionnaire distribution and collection 40 days
4 Analysis of the data 20 days
5 Writing thesis 30 days
6 Final preparation of thesis 20 days

Therefore approximately duration of days to complete thesis will be of 140 days. The
duration days might increase under certain circumstances.

3.11 Detail budget

S.N. Activities Cost

1 A4 size paper 6,000

2 Printing of questionnaire 6,000
3 Photo copy expenses 6,000
4 Travelling cost 4,000

5 Miscellaneous expenses 4,000

Therefore the total expense will be about Rs. 26,000.

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3.12 Summary

Although there have been many studies done on celebrity endorsement and their
impact on consumer behavior. However there is no such study done in Nepal on
influence of celebrity endorsement on consumer behavior on local product i.e. Nepali
shoe brand. At present Nepali shoe market is continuously growing. Marketer are
taking every possible steps to promote their brands for which celebrity endorsement
one the means practice by marketer. The main purpose of this study is to what extend
Nepalese consumer are influenced by Nepalese celebrity endorsement and also to
study that do celebrity really impact on profit contribution. So in order to study this
research 200 sample size will be used. The data will be collected using questionnaire
and it will be analysis by SSPS soft

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