Content area
Full Text
Introduction
Celebrity endorsement is considered an effective promotional tool by marketers worldwide. One-in-four advertisements use celebrity endorsement ([56] MarketWatch, 2006). Celebrity endorsement influences advertising effectiveness, brand recognition, brand recall, purchase intentions and even purchase behaviour. Recent research has also demonstrated that celebrity endorsement leads to a favourable attitude toward the endorsed brand ([80] Till et al. , 2008), but does it have value in terms of developing brand equity?
The term brand equity refers to the incremental value added by a brand name to a product ([26] Farquhar, 1989). Extant literature emphasises the need for further research identifying marketing activities that can build brand equity ([42] Keller and Lehmann, 2006; [87] Yoo et al. , 2000). It is commonly accepted that advertising is useful in building brand equity ([40] Keller, 2005) and that spokespeople may become associated with a brand in memory ([38] Keller, 1993), but how does celebrity endorsement lead to improvements in brand equity? [77] Till (1998) and [53] McCracken (1989) have suggested that celebrity endorsers can build brand equity by creating secondary associations. [70] Seno and Lukas (2007) have proposed that a celebrity endorser operates as a co-brand for the endorsed brand resulting in the creation of equity for both the endorsed brand and the endorsing celebrity. There is also empirical evidence to say that celebrity endorsement generates greater recall for both the endorsed brand and the advertisement ([4] Atkin and Block, 1983). Research has also shown that celebrity endorsement can influence perceived product quality and uniqueness ([18] Dean, 1999).
There is, however, limited understanding of how the credibility of an endorser might influence the endorsed brand's equity. Furthermore, the credibility signalled by a brand is considered important and is believed to contribute to building brand equity by indirectly adding consumer value to the brand ([20] Erdem and Swait, 1998). Does the use of credible celebrities for endorsement lead to improvements in brand credibility? Extant research does not answer this question either. The practice of sub-branding, whereby an existing brand name is combined with a new name to enter a different product category ([39] Keller, 2003), is widely used in industries such as automobiles ([34] Jo, 2007). It is, however, not clear whether celebrity endorsement would be more or less effective for...