CHAPTER I
INTRODUCTION

Mass media has been around us for all our humanity and constantly evolving through time. From the early poets and writers of the civilizations as early as 3000 A.D., who were adored by their kings and superiors for their succulent plays and gratifying dramas, to the first print of the newspaper who reached its audience in a massive way. And as we, humans, evolve, so does technology. From listening to the voices coming out of these transmitting devices called radios that were invented in the 1894 by Guglielmo Marconi, to the invention of television that gives you a front-eye view on this great audio-visual experience. During the 1950s, black and white television became a part of American household. What was earlier in the paper can now be seen and heard at the same time. And in between the late twentieth and early twenty-first century, came the Internet. It reached its mass audience in a global scale. Connecting people from around the world, this has been the most effective way of communicating and sending a message to the people.

And mass media led companies and alike to have a new way of reaching their prospects and consumers through advertisements. Advertisements of products on radio, television, billboards and others alike have been around for more than 300 years. And as we fast forward in time, it has evolved from simple and in-your-face commercials to the lavish and extravagant advertisements seen and heard by us. And other companies let the celebrities do the talking. Sports icons, movie stars and musicians, to name a few, are used to endorse a company’s product or service. It has been a trend for the companies, small and big, old and new, to have a “face” that can carry the name of the product or service they will provide to their customers.

Having a celebrity endorser to a company comes with a very big price, literally. They invest on these advertisements or campaigns, to have that famous person to be the poster boy or girl of their company. And the more popular in the entertainment, sports, or any industry he or she be in, will be more likely to be chosen by the companies to endorse their product. The mass popularity of an entertainment star is his or her ticket on landing an endorsement spot.

In the Philippines, almost all of the people here have an easy access in any form of mass media. That is why endorsements with a famous star/s are a big deal when it comes to advertising the product, services or the companies itself. TV commercials of actors and actresses, the big billboards of models endorsing a clothing line or a beauty product you see along our busy streets, are now a very common thing for us and the business world. But what are the effects of having a famous man, woman, or a group of people endorsing a company’s product or service to its prospect and consumers?

And for that, as a consumer too, the researcher has decided to conduct a study on “The Effects of Celebrity Product/Service Endorsement on Consumers”.

BACKGROUND OF THE STUDY

The history of celebrity endorsement of products dates back to the 1760s in America. Josiah Wedgwood, the founder of the Wedgwood brand of pottery and chinaware, also called “The Father of the Modern Brand”, used royal endorsements and other marketing devices to create an aura around the name of his company that gave the brand a value far beyond the attributes of the product itself. Between 1875 and 1900, the trade card, either handed along with the product to the customer or inserted in the packaging itself, popularized celebrity endorsing. The card had a picture of the celebrity and a product description, but had no quote or a direct testimonial by the celebrity. Trade cards featured actresses like Lily Langtry and Sarah Bernhardt and baseball players like Cy Young and Ty Cobb. Author Mark Twain featured on three brands, Great Mark Cigars and Mark Twain Cigars and Mark Twain flour.

Till the early 1930s, the major endorsers were athletes, but by 1945, movie stars like Charlie Chaplin were more sought-after. With the rising popularity of the color TV in 1965, TV personalities and entertainers also became popular. By 1975, one in eight TV commercials featured a celebrity. Researchers Robert Clark and Ignatius Horstmann of Boston University studied a collection of 1000 endorsement advertisements from 1920-1970 and found from that they were predominantly used by cigarettes, beauty products, beverages and audio equipment.

By 1980, companies started making products around celebrities. Standard Brands Inc, for example, created a new candy bar called "Reggie", after New York Yankees' superstar Reggie Jackson. Faberge Inc. introduced an entire new line of Farrah Fawcett hair-care products. Athlete endorsements picked up again in 1984 when Nike discovered a young and extremely talented basketball player, Michael Jordan. Nike relied heavily on Jordan’s 'image' to make itself a global mega-brand. In 1989, out of 59 celebrities employed by Coke, 48 were athletes. Almost 75% of all sports-related products like clothes and shoes used athletes to endorse their brands.

In the late 1990s, Companies took endorsements to a new level by holding press conferences to announce deals with celebrities. Celebrities were no longer just endorsers. They had become spokespersons for the brand. In the case of sit-coms (Friends) and movies, the celebrities' characters promoted the brands. In 1998, it was estimated that companies in the US spent $800 million on acquiring celebrities for advertisements, promotions and PR campaigns. The total estimated endorsement commitments for 2004, for one company, Nike totaled $338.6 million. Multiple endorsements - both the company signing on several celebrities to promote a brand and one celebrity endorsing various brands, sometimes switching between competitors had become de rigueur. In 1999, one in five advertisements on TV featured a celebrity. An AdAge study of the 20 most effective television ads of 2002, celebrities like Britney Spears featured in two-thirds of the advertisements.

The fact that more and more celebrities were willing to lend themselves to endorsement deals, contributed to the increase in the number and value of the deals. While the money involved was considered as one of the main reasons for signing deals, there have been cases of endorsements that were based on pure altruistic motives.

In the early 90’s to the new millenium, three major showbiz personalities here in the Philippines dominated the product endorsements: Aga Muhlach, Richard Gomez and Sharon Cuneta. Some of the notable celebrities that have been the face of the product include The Gutierrez twins, Richard and Raymond, for a powdered milk commercial, Gary Valenciano and others.

Today, here in our country, the most famous celebrity endorser is Manny Pacquiao. He is not only the famous here in the Philippines, but also one of the top endorsers worldwide. Locally, Kris Aquino is the top earner in this category, from her tons and tons of product commercials. John Lloyd Cruz comes in second for promoting brands ranging from over-the-counter medicine, instant noodles and many more. Kim Chiu came in the third place for having her face on commercials for a fast food chain and consumers. Most of advertisers think it is her youthfulness and wholesome image made her an effective product endorser. The list also includes Piolo Pascual, Anne Curtis, and Sarah Geronimo, just to name a few.