Online Celebrity Endorsement

Competing in a turbulent and competitive business landscape requires organizations to continuously introduce innovative products which meet the trends, lifestyles and expectations of customers. Advertising is the most common and viable tool used as part of the retailing industry in creating awareness and persuading customers about the brand name. The fundamental goal of this study is to obtain a deeper understanding of the impact Of celebrity endorsers in online retailing leading to purchasing decisions and behavioral intentions of online shopping consumers in the inline retailing related websites.

Particularly, this research examines whether a celebrity endorser adds value to the brand equity of internet retailing, and to what degree celebrities can impact online shopping consumers’ purchasing decision and how does negative celebrity attributes influence consumers’ purchasing behavior. According to the results of this study it was revealed that celebrity endorsers do impact the online shopping consumers in some ways as they refer to the celebrities as an essential reference group. It is likewise found that online shopping consumers in Malaysia perceive the liberty endorser as someone who influences their purchasing decisions.

Although the growth in internet usage is expected to slow down gradually being the maturity effects that will happen across the globe, the same report stated that the sales number is still projected to hit $2. 6 trillion in 201 8, underpinned by 10% expected growth rate that more than $200 billion dollars during that particular year. Despite these impressive accomplishments e-commerce in Malaysia is yet to realize its full potential due to ingrained prejudices and a marked hesitation on part Of consumers to trust the newly established system.

No wonder that online retail in Malaysia still accounts for less than 1% of total retail sales (Hanna Ben-Sabbath, 2013). This is mainly because the public has not been effectively exposed to the benefits of the new medium visit–visit the conventional shopping practices. Fears linger on account of security of online transaction deals, unsought e-mails, disclosure of personal details, and credibility of the online retailers, etc. Which need to be relived.

Then there are consumers who would like to touch-feel the product rather than making transactions online. In the event that online retailing is to flourish in Malaysia then the trust shortage needs to be spanned so that online shopping can obtain the nature of an ordinary; routine propensity. 1. 2 Purpose and Research Questions Many of the previous studies on celebrity endorsement have focused on how celebrity endorsement influence consumer behavior on different platforms of detailing or advertisement for products/services.

What has received less attention in empirical research on celebrity endorsement is the online retailing platform and the corporate perspective on how to choose the right celebrity for the right platform that you need to advertise for. The lack of research in this area motivates the present study. The purpose of the study is stated as follows: To obtain a deeper understanding of a company’s choice of celebrity endorsement and how characteristics and negative attributes of those celebrities selected might affect the consumers’ purchasing behavior in online retailing. To study the purpose the following research questions were formulated: 1 .

Does a celebrity endorser add value to the brand equity of online products/ services? 2. Are celebrity endorsement advertisements effective towards consumers’ purchasing decisions? 3. How does negative celebrity information influence consumers’ purchasing decisions? 4. How to improve the efficiency of using celebrity endorsement in the online retailing industry in Malaysia? 2 Literature Review: 2. 1 Online Retailing Online retailing or widely referred to as e-commerce is a type of business model or segment of a larger business model that enables a firm or individual o conduct business over an electronic network, typically the internet.

E- commerce generally operates in four major market segments: business to business (BIB), business to consumer (BBC), consumer to consumer (ICC) as well as consumer to business (CB). Subsequently, Banal (2011 ) through his report introduced yet another type of e-commerce business I. E. Business to government (BEG) model into the list. The online retailing could be traced all the way back in 1979 whereby the concept was firstly introduced by an English entrepreneur Michael Aldrich, in which he used a system connected to a modified television (TV) to a real-time renovation processing computer via a domestic telephone line.

Michael Aldrich believed that the modified domestic TV technology with a simple menu-driven human-to-computer interface was then a ‘new and universally applicable’ communication platform after the invention of the telephone. The said system enabled closed and direct corporate information systems to be opened to external correspondents not just for transaction processing but also for e-messaging and information retrieval and dissemination, which was later known as e-commerce (University of Brighton December 1982). . 1. Business to Consumer (BBC) Reanimating & Sympathy (2002) defined BBC as a form of business or transactions that were conducted directly between a company and consumers who are the end-users of the particular products or services. BBC as a business model differs significantly from the BIB model, which refers to commerce between two or more businesses.

While most companies that sell directly to consumers can be referred to as BBC companies, the term became immensely popular during the dotcom boom during the late asses, when it was used mainly to refer to online retailers, as well as other companies that old products and services to consumers through the Internet (Reanimating & Sympathy, 2002). While it is observed that the BBC e-commerce model was initially being adopted by the brick and mortar companies like what Pizza Hut and Unsafe did in pioneering the model; several larger and international brands eventually leveraged successfully on the said model (Reanimating & Sympathy 2002).

The likes of globally renowned brands such as Nikkei, Apple, and even McDonald’s did remarkably well in this field whereby the average website visitors for the former alone reached more than 10 million users per ay. Over the years, the revolution of internet technologies saw another refined model of BBC emerged by providing a platform for the said brick and mortar retailers which adopted online retailing model to be all residing in a single website for the same purpose (Galatia & Caring 2000). This particular platform provider for the BBC model acted mainly as the intermediary of ‘brick and mortar businesses’ and ‘consumer.

In this case, the likes of Group, Lazed and Azalea are the best examples. By engaging with this model, instead of visiting a seller’s designated website, a consumer can now sit the ICC platform to get the all best deals under one single website. 2. 1. 2 Characteristics of BBC Websites Hugging (2001) explained that the key characteristics of a BBC lies on Its content and design whereby its content refers to the type of information, features as well as services on the particular website while design is how the above information was presented to the consumer.

As such, the usefulness a BBC website does not only depend on its content but the tools involved in providing a user-friendly approach to the consumer. Before performing an online transaction, consumers will typically source for information regarding the brand, variety, price as well as the quality. Having said that, different consumers have different approach hence to tackle this problem, online retailer with their BBC website normally offer information through the provision of hyperlinks so consumers can obtain more detailed information on a particular product or service. Consumers will always go for information search with lower costs.

Therefore, BBC websites which offer user-friendly navigational features would create a better usage experience for its customers and subsequently add to the advantage over its peers (Alba et al. 1997). Bellman (1999) pointed out another important characteristic of a BBC website, which is the ease that a consumer can get what they could navigate comfortably on a website. More often than not, a BBC website will typically have 2 different displacing methods I. E. The normal desktop version and also the mobile version to cater the fast growing internet users who browse the internet via smartness and tablets.

Unsystematic and poorly organized navigation of a BBC website will drive the consumers away (Reanimating & Sympathy 2002). 2. 2 The Use of Celebrity Endorsement through Time The uses of celebrity endorsement in marketing is not a new phenomenon in which this approach has been adopted since the late nineteenth century and was initially used widely in cinema commercials in the 1 9305, followed by the very first commercial radio stations and subsequently in television commercials back in the asses (Reardon 1999).

One could not deny that to date, It is not surprising that a celebrity is endorsing a product or service. However, in earlier days the availability of ‘stars’ or potential endorsers was very limited as they were deemed to invest their prestige on TV as mere ‘brand endorser’, Reardon (1999). For this very reason, advertisers were restricted in their search for celebrities that were exactly right due to the said limitation. The supply of celebrities only started to increase and received more attention in late asses. 2. 2. Pros & Cons of Celebrity Endorsement Reardon (1999) expresses that academic findings and company reports securely contend that celebrity endorsers are more viable than non-celebrity endorsers regarding creating all profitable outcome (attitudes towards advertising and endorsed brand, intentions to purchase the actual sales) when organizations use celebrities whose personality match with the rodents/comes and the targeted audience and who have not endorsed celebrities. Checked Regardless of the possibility that there is profit with utilizing celebrity endorsers, one ought to realize that there are likewise expenses and risks.

Advantages Disadvantages Increase attention, refresh a brand, and add new dimensions to a brand. Overshadow the brand; celebrity may even be considered to be the co-brand. Image Polishing, Brand Introduction, Create Awareness. Public Controversy; overexposure, dislike for celebrity. Brand Positioning and Repositioning, brand refreshing, adding sex appeal. Loss of Public Recognition; celebrity declines in importance. Underpin Global Companies, lead to more favorable advertising rating, brand evaluation, and higher profits.

Image Change; Financial Risk; long term contract with failing celebrity Table 1: Advantages and Disadvantages of Using Celebrity Endorsers Pros. : Reardon (1999) through his studies shortlist five significant advantages for engaging with celebrity endorsement for advertisement: Increase attention practically makes sense because a celebrity will generally have higher degree of attention from the public, a news circulating that a pacific brand or product being endorsed by a particular figure will undoubtedly achieve this objective.

Image polishing could also work well with the presence of celebrity endorsement. For example, the McDonald brand which has been consistently and infamously labeled as an unhealthy food provider was seen sponsoring an annual event in Malaysia – Olympic Day Fun Run with a powerful tagging every participant shirts saying “its what I eat and what I do” to counter the negativity message aimed at the international brand. Besides, McDonald was also seen endorsing well-known sport celebrities to change the perception of people’s mind (Reardon 1999).

Business organization uses celebrity endorsement to ensure that consumers remembers the products or services that was endorsed, a strategy which is extremely important and crucial for new product brand. Maniac en Scanning (1994) reaffirmed it by reporting that the use of celebrities is a useful approach for any company who wishes to establish a new image or even repositioning of its brand in the market. Celebrity endorsement is also very important in companies with their brand spread across the globe. In this case, such companies will normally engage tit celebrities with both national and international reputation to endorse their products.

Matter & Matter (1997) pointed out a classical example with the Michael Jordan appearing in different campaigns for different products all over the world made the overall sales of the companies involved pocket in two billion dollar on market and stock value. Cons. : Celebrity endorsement also posed several notable disadvantages to companies. By far, perhaps the most undesirable negative effect of using celebrity endorsement is the impact of the celebrity overshadowing a particular brand. This phenomenon, called the vampire effect is explained by

Reardon (1999) where the celebrity takes the living blood of the product or brand with no consistent connection between the celebrity and the product. Another disadvantage will be the risk of the celebrity involving in controversies which caused the public to respond negatively. The best example will be Brittany Spears who used to be everyone’s darling and sweetheart ended up with loads of controversial encounters and subsequently blown out of her limelight era. Companies engaging with her for promotional purposes could be very well killing the product.

The last but perhaps the most critical point will be the endorsement fee imposed by the celebrities or agent for the endorsement. An internationally recognized celebrity typically pocketed millions of dollars from their marketing and endorsing contracts – some earned even more than their prize money. Hence, business organizations who wish to adopt this strategy would really have to ascertain the costs and benefits of doing so to ensure that the ultimate objective of a company in profit making is reachable. 2. 3 Celebrity Selection: 23. Models for celebrity endorsement Selecting the right celebrity endorser is an important but also very difficult ask, meaning that there could be just as easy a misfit or a fit between the celebrity and the product. Over the years academics and researchers have gained interest to find out what are the right kinds of qualities or criteria of celebrity endorsers that are appreciated by consumers. Two characteristics that were always mentioned are credibility and attractiveness. The TEARS model and the NO TEARS model which will be introduced later on are also based on these two attributes.

But we shall start with describing the source credibility and attractive models. 2. 3. 2 The Source Credibility Model In the 1 dad’s Havilland and colleagues developed the source credibility model (Van Infertile, 2009). According to this model, the effectiveness of delivering a message from an endorser to a consumer depends on the perceived level of trustworthiness and expertise. Trustworthiness refers to the endorser’s honesty, credibility and integrity, as perceived by the consumers. It is a matter of determining whether the target trusts the source for the honest and objective way of presenting the information/product. . 3. 3 The Source Attractiveness Model The attractiveness model assumes that the effectiveness of delivering a usage from an endorser to a consumer depends on the physical characteristics of the source. According to this model a celebrity’s physical attractiveness has a positive impact on brand recall, attitude towards the brand and purchasing intent (Van Infertile, 2009). The targets acceptance of the advertising can be influenced by the endorser’s physical attractiveness, particularly due to the endorser’s similarity, likableness and familiarity. 3. 4 The TEARS Model Shims (2003), introduced the TEARS model which emphasized on credibility and attractiveness as two characteristics that motivates the endorser’s effectiveness. The TEARS model represents five attributes: trustworthiness and expertise belongs to the credibility component and physical attractiveness, respect and similarity are dimensions of attractiveness. Fig. 1: The TEARS Model T – The term Trustworthiness refers to the believability, honesty and integrity of a source.

Despite the fact that expertise and trustworthiness are not totally unrelated, regularly a specific endorser is seen as very reliable yet not particularly expert. An endorser’s trustworthiness rests on the consumers impression of his or her endorsement motivations. As it were the point at which the endorser is persuaded only for individual reasons it will be less trustworthiness then when they do not have anything to gain by endorsing the product (Van Infertile, 2009). E – Expertise refers to the knowledge, experience or aptitudes controlled by an endorser as they identify with the endorsed product.

Low and Limit (2012) expressed that; whether an endorser is truly an expert is unimportant; the only thing that matters is the way the target consumers see the endorser. Endorsers who are seen as an expert are more enticing in changing audience opinions relating to his or her range of ability then if the consumers do not e the endorser as an expert. A – Attractiveness quality means more than basically physical attractiveness and incorporates any number of virtuous attributes that consumers may see in an endorser.

At the point when consumers discover something in an endorser that they consider attractive, influence happens through identification. Meaning that when consumers perceive a celebrity endorser to be attractive, they identify to the endorser and are likely to adopt the endorser’s attitudes, interest, behaviors or preferences (Van Infertile, 2009). Shims (2003) divides the term attractiveness into three subcategories; hysterical attractiveness, respect and similarity. Physical attractiveness, the A part in the TEARS model, is a key consideration in several endorsement relationships.

The best example for this is tennis player Anna Groundwork. In spite of the fact that she never won a competition on the professional tennis circuit, she figured out how to acquire an expected $1 0 million for every year in support bargains. Shims (2003) claims that Groundwork was chosen on uncommon physical engaging quality and not on her extraordinary tennis playing. Examination backs the instinctive desire that hectically appealing endorsers create more positive assessments of promotions and publicized brands than do less alluring communicators (Shims, 2003 and Van Infertile, 2009).

R – Respect, speaks to the nature of being appreciated or even regarded because of one’s personal qualities and achievements. While a celebrity physical attractiveness quality may be viewed as the “structure” part of the general attractiveness characteristic, admiration is the “function” or substantive component.