Influence of celebrity brand endorsement on buying behavior of the indian soft drink consumers Acknowledgment



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3.9 Limitations


  • Sample taken for the study is relatively small (92 respondents), so the generalization of the results may be misleading and inappropriate.

  • Limitation of resources is another limitation of the study.

  • Also because of the limited time, study may not be entertained with proper enthusiasm as the topic is supposed to be. This research is completed in the previously defined time slot which affects its trustworthiness, it requires more time for the purpose of the research.

  • Report includes thoughts and views of various authors through literature review which may be contradictory at times

  • Respondent have not provided the answers with authenticity, which also acts as the limitation of the research

  • Some data is collected through the secondary sources where the observations of the authors may be biased or not related to the study.

  • Findings of the research cannot be generalized as it has been conducted in a confined area or territory

  • Small sample size

  • Location constrain, research is based only at London

3.10 Celebrity Endorsement Strategy: Case of Coca Cola India


Starting with just a sale of nine glasses of drinks per day, Coca Cola has written a success story after a triumphant stretch of operations for about 125 years. Company’s current production counts to be more than 10 billion gallons of drink per day and selling products across 200 countries worldwide. With a portfolio of more than 450 brands, the company is one among the largest beverage companies.

Coca Cola - the name came to India in the post independence era i.e. after 1947 in the year 1956. That time, there was not any foreign exchange act to regulate overseas trade and investment in the country. Take advantage of the above flaw of Indian legislation, Coca Cola made enormous money operating under 100% foreign equity. The Indian foreign exchange act came into force in the year 1974 during Indra Gandhi government age. According to this act, for selling consumer goods, a foreign company must devote 40 percent equity stake in India in its Indian associates. Coca-Cola decided for this but laid down a condition, of holding full power in administrative and technical units with no local involvement allowed.

This condition was against the Indian Foreign Exchange Regulation Act (FERA), so GoI instructed Coca Cola to either leave the country or write up a new plan. In 1977, when Janta Party came into power, the stress for Coca Cola increased, and finally company decided to quit. Coca Cola came to India with Rs. 600,000 only, which was not a big amount. It was equal to an investment of $20,000 at the prevailing exchange rate of that time. But, at the time of departure from India, the company had already made a profit amounting to be $ 8 million or in rupee term it was Rs. 250 million. In twenty years, nearly 400 times return was reaped by the brand. Coca cola found India a very lucrative market, so after industrial liberalization, company made a return. It was almost 16 years in 1993, when Coca Cola came back.

16 years back, it was a monopoly market for Coca Cola, but now the game was completely changed. Many local brands, Campa Cola, Thumbs Up, Gold Spot etc., had already made their positions, besides those international brands like Pepsi and Cadbury were also fighting for the market share. But still, Coke made it possible for holding 51% market share after a journey of 19 years, all through its marketing and competitive strategies. Subsequently, Coke made significant investments in the Indian market with an aim of inclusion of more and more people, even targeting the remotest and inaccessible areas of the country. It cemented its presence with a milestone deal of acquiring top most Indian soft drink brands, such as Thums Up (one of the most trusted brand of soft drink in India), Limca, Maaza, Citra and Gold Spot. This step of acquisition not only provided a wide portfolio but also availed coke with physical manufacturing, bottling, and distribution assets along with strong consumer preference. This portfolio of local and international brands made it possible for Coke to encash the market opportunities. Company’s product portfolio became a combination of global and local brands.



After leadership tenure of 19 years, Coca Cola holds a diversified portfolio of brands, catering to the tastes of different consumer segments. In India, company’s portfolio is as described in the underneath table:

Table 3 Different brands of Coca cola and their marketing USP.

S. No.

Brand Name

Remarks

1.

Coca-Cola

General brand, targeting all segments

2.

Diet Coke

Diet conscious consumers

3.

Sprite

Youth, and smart consumers

4.

Fanta

Smart girls

5.

Thums Up

Youth, with thrilling atitude

6.

Limca

Fresh quench

7.

Maaza

Fruit drink, targeting children

8.

Maaza Milky Delite

Fruit drink, targeting children

9.

Minute Maid Pulpy Orange

Rich & nutritious orange drink

10.

Minute Maid Nimbu Fresh

Instant Ninbu Pani mix launched initially in southern India

11.

Burn

Strong, fantasized drink

12.

Kinley Water

Pure water

13.

Kinley Soda

National brand for soda

14.

Schweppes

An International brand

15.

GEORGIA Gold

Espresso, Americano, Cappuccino, Caffe Latte, Mochaccino, Hot Chocolate, Cardamom Tea

According to the author of “Treasure Island”, Robert Louis Stevenson, “Everybody lives by selling something". Further he says, “Agents, CMOs and deal makers will always get starry-eyed by the names of "celebrity". It is because, brands love endorsements, and consumers buy into "celebrity."

Many recent studies concluded that sales figures of some brands have shown an increase of almost 20% backed by endorsement practices. An associate professor at Harvard Business School, Anita Elberse in a study found that some companies experienced an increase of 0.25% in stocks, after the announcement of endorsement deals.

India is a huge nation, with cultural and geographical diversities, which has resulted in existence of different language speakers across the country. Coca cola recognized this assortment that is why they have produced ads in 6 or more languages, reflecting India's linguistic diversity (Business line, 1998). Southern states of India habitually require different strategies of marketing due to the notable cultural differences between south India and North India. So Coca-Cola India came up with alternating celebrity endorsements for southern India e.g. They have used Tamil superstars rather than Bollywood stars and promoted Coke accompanying with regionally relevant food combos. Over and above these localized efforts Coca-Cola has also come up with dialect style print and television ads.  Known the extensive fame of cricketers and movie stars, the company has lined in a host of cricketers and Indian movie stars to endorse its products.

Celebrity endorsement, the key marketing tactic, is being adopted by many companies for years. The same dynamic strategy of positioning and marketing communication was adopted by the company, in order to fascinate the Indian market. More often, the company attempted to rapt consumers in India by establishing an association with their passions for say, cricket, movies, music or food. With a step of sponsoring the World Cup in 1996 and subsequently various national tournaments inclusive of the Sharjah Coca Cola Cup in the late nineties, the brand successfully gained identity among Indian urban population. Coke attempted to play catch-up with a two-pronged gambit: One, introduction of jingles in the ad campaign; and, two, inclusion of celebrity endorsement. From 1993 to till date, Company taped the youth segment with celebrity endorsement and jingle based marketing. Jingles like;



  • “Always The Real Thing”,

  • “Pee Le Coca Cola”,

  • “Jo Chahe Ho Jaye...Coca Cola Enjoy”,

  • “Taste the thunder”, “Taza Maaza”,

  • “Life ho to Aisi”,

  • “Thanda Matlab Coca Cola” and

  • “Aaj Kuch Tuffani Karte Hai”

These identity slogans made the brand much popular among the youngsters. Celebrities endorsement multiplied the effect of those jingles. Company spent crores of rupees on such endorsements. This stimulate demand in the market by associating with life style and behavior and mainly targeting value based advertising. It has many brand ambassadors like Shahrukh khan, Hrithik Roshan, Ghambir, South Indian Actor Vijay and Trisha, Aamir khan, Kareena Kapoor, Imran khan, Mahesh Babu, Sachin Tendulkar, etc.

These endorsements by Coca Cola changed from time to time. When Hritik Roshan Debute movie released and received a grand success, Coke signed a deal with him. When World cup seasons or IPL seasons come, endorsement strategy completely changes. At such times of national or international tournaments, company uses cricketers, athletes for endorsing the product. Similarly on festivals endorsement style and ad both change.



Coke commercial was endorsed by Hrithik Roshan for Rs. 3 crores. It was the highest amount paid by the company of that time. Coca-Cola had signed Bollywood actress Genelia D'Souza as brand ambassador of its launched product, Fanta Apple in 2008. In 2009, the Coca cola had signed Gautam Gambhir for coke has a brand ambassador to leverage the passion of cricket among youngsters. In 2010, the company signed Imran khan for the coca cola endorsement. Coca-Cola had signed two years deal with bollywood actress Kareena Kapoor to endorse its drink Limca for about Rs 2.5 crore a year.

Coca-Cola has dropped Akshay Kumar for Thumps Up in 2012 for Telugu superstar Mahesh Babu. Thumps up for several years was endorsed by Akshay kumar by defying stunts as its USP of its full of action commercials, but in 2012 he was dropped for Telugu superstar Mahesh Babu, and, apparently to give its action-oriented commercials some liveliness and glamour. The cola brand had replaced the actor with Kingfisher model Angela Jonsson, to bring in the campaign with a touch of youth and beauty.

Maaza is currently playing common person commercial where a tag line is used Maaza Mango Mania. This is a story concerning a father who is very much tempted towards Mangos. His son entitles this as Mango Mania. His father was so fond of mangos that he start imaging mango everywhere. When a Politian at some point in his election speech says something on benefits for “Aam” aadmi, his dad again hits by the Mango mania. And then the son lastly suggests giving his father a mango to drink that is Maaza rather than to eat. He gets Maaza and his father finds relief for its mania. The Coca-Cola has signed the three-year endorsement deal in 2011 with Sachin Tendulkar, where he is being paid almost twenty crores. In 2010 The Company had launched Burn Energy Drink in Mumbai, New Delhi and Bangalore, Maaza Milky Delite in Kolkata and Minute Maid Nimbu Fresh all over the country. Now the top endorsers of cola brand are: Sachin Tendulkar for brand coke, Kareena for Limca and recently Telugu actress Tamanna Bhatia is chosen as face of Fanta for Tamil Nadu and Karnataka.

These endorsements cost quite high. Spending counts in crores. According to a news agency, on an average a beverage company spends 20 to 40 million USD for such promotional campaign. Coca Cola has a year long history of celebrity endorsement. It has spent bucks for promotions. Spending trends on different brands for having a celebrity association are as follows:



  1. Company spent Rs. 20 (cr). To sign Sachin Tendulkar as its brand ambassador. As per industry average, Sachin charges Rs. 5 (cr). Per an endorsement.

  2. Kareena Kapoor, in new Limca ad, cost Rs. 2.5 (cr).

  3. Amir Khan’s two years back endorsement campaign was of Rs. 10 (cr).

  4. Akshay kumar charged Rs. 4.5 (cr). For Thumbs Up ad in 2010.

  5. Sonam Kapoor singed coca cola endorsement deal amounting Rs. 3 (cr).

Coke till now has signed deals with 15 Indian celebrities for endorsement. These deals have offered them more than their doing a single movie for an actor or tournament for sports persons.

Figure 7 Spending for Celebrity Endorsement by Coca-Cola India.

In accordance with the spending, does the company really reap that high benefits from such endorsement? Certainly yes, because in today’s competitive world, brand is the most precious asset of any firm and associating a celebrity name with our most crucial asset is not a joke. It’s a vital decision taken by the top management, whom to engage for the endorsement and how much to pay?






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