2012 Cambridge Business & Economics Conference
ISBN : 9780974211428
Modeling the Effects of Celeb-Entrepreneur Endorsement on Advertising Effectiveness:
The Case of Malaysia’s Pop Princess
Mazzini Muda
Faculty of Business Management, Universiti Teknologi MARA Malaysia
(60-0129151964; mazzinim@salam.uitm.edu.my),
Rosidah Musa
Faculty of Business Management, Universiti Teknologi MARA Malaysia
(60-0192980780; rosidahm@salam.uitm.edu.my)
June 27-28, 2012
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Modeling the Effects of Celeb-Entrepreneur Endorsement on Advertising Effectiveness:
The Case of Malaysia’s Pop Princess
ABSTRACT
Celebrities have been hired to endorse products in advertisements for a long time. They are
found to be more effective than non-celebrity endorsers because of their credibility in the eyes of
the audience. Recently, some celebrities are taking it a step further by endorsing their own
brands or labels. Despite being extensively reported in popular media, scholars have been slow to
recognize the importance of this new phenomenon. To address the gap, the purpose of study is to
develop, test and validate a model that can explain the effects of celebrity entrepreneur-endorser
on advertising effectiveness. This research hypothesizes that celebrity credibility (attractiveness,
trustworthiness, expertise and decorum) and advertisement credibility will positively affect three
traditional measures of advertising effectiveness –attitude toward the advertisement, attitude
toward the brand and purchase intention. A real print advertisement featuring Malaysia’s number
one songstress who is also an entrepreneur accompanied a self-administered questionnaire, was
filled up by 542 female respondents. Data were analyzed using structural equation modeling
(SEM). The findings indicate that all aspects of celebrity credibility are significant predictors of
attitude toward the advertisement with celebrity decorum as the main contributor. Celebrity
credibility and advertisement credibility significantly influence advertising effectiveness. These
findings have important implications for future research directions and advertisers.
Keywords: celebrity entrepreneur, celebrity endorser, credibility, attitude toward the
advertisement, attitude toward the brand, purchase intention
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INTRODUCTION
Advertising is a popular, yet challenging form of marketing communications. With increasing
rivalry for consumer attention and new product introduction, advertisers are forced to use
attention-grabbing media stars. These celebrities can help advertisements stand out from the
surrounding media clutter, thus improving communicative ability by cutting through excess noise
in the communication process. Celebrity endorsements have also been found to produce better
recall or recognition of a brand name (Friedman & Friedman, 1979; Petty, Cacioppo &
Schumann, 1983). Many studies have also shown that celebrity endorsers favorably influenced
important advertising effectiveness measures such as attitudes toward the ad (AAD), attitude
toward the brand (ABR) and purchase intention (PI) (Atkin & Block, 1983; Frieden, 1984;
Kamins, 1989; la Ferle & Choi, 2005; Petty et al., 1983). Furthermore, celebrity endorsement
strategy has the ability to create an image for a product through meaning transfer (Debevec &
Iyer, 1986; Langmeyer & Walker, 1991; McCracken, 1989). For these advantages, companies
are willing to pay handsomely to have celebrities endorse their brands in the advertisement.
From the perspective of the celebrities, endorsement presents a lucrative supplemental income,
which for some celebrities means income far above what they actually made in their original
field of work. The allure of multiple endorsement contracts, for instance, brings unwelcomed
consequences to the celebrities as well as the companies who hire them. Celebrities who
endorsed too many products will lose credibility with consumers who will question the real
motive of the endorsement (Tripp et al., 1994), which is more for the money than real testimony
for the product. As a result, multiple endorsements will limit the effectiveness and appeal of
celebrity endorsement (Silvera & Austad, 2004). With limited opportunity to endorse, some
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celebrities started to open up their own company and promote their own products by appearing
as the endorser or spokesperson. The phenomenon of ‘celebrity entrepreneur-cum-endorser’ is
relatively new thus little literature is available. However, celebrity entrepreneurship does share
many similarities with celebrity endorsement (Hunter, 2010; ).
Our knowledge on the effects of celebrity endorsement has been largely informed by researches
and models developed in Western countries in which the people has an unhealthy obsession with
celebrity culture especially among the younger generations (Douglas, 2003; McCutcheon, Lange
& Houran, 2002; Swami, Taylor & Carvalho, 2009). This has led the authors to be concern about
the application of those models in Eastern cultures especially cultures dominated by Islamic
values that prohibit excessive worshipping of celebrities. Given the recent escalation of celebrity
endorsement advertisements in Malaysia, this study may provide some evidence of Eastern values
in interpreting the meanings of credibility of celebrity endorsers in developing countries that have
similar characteristics with Malaysia.
In order to fill the gap, this study aims to develop a theoretical framework to understand the
importance of celebrity credibility in influencing the effectiveness of the advertisement when the
celebrity is both, the endorser and the owner of the brand advertised. This study also seeks to
explore the importance of advertisement credibility in the celeb-entrepreneur endorsement model
and its roles in advertising effectiveness; conceptualized as consisting of three traditional
measures – attitude toward the advertisement, attitude toward the brand and purchase intention.
By proposing and subsequently testing the structural relationships among the five constructs, this
study intends to achieve the following objectives: (1) to explore the underlying dimensions of
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celebrity credibility, (2) to investigate the effect of celebrity credibility on advertising
effectiveness, and (3) to investigate the impact of company credibility on advertising
effectiveness.
THEORETICAL BACKGROUND AND HYPOTHESES
Celebrity Endorser and Celebrity Entrepreneur
Celebrities are individuals who are well-known to the public due to their accomplishments in
areas such as sports, entertainment, politics, broadcasting, corporate and etc. (Speck, Schumann
& Thompson, 1988). In many societies, celebrities are perceived as model of success. Many
consumers aspire to share their values and lifestyles (Alsmadi, 2006). Consumers frequently
imitate the ways celebrities dress, communicate, and most importantly, the brands of products
celebrities choose and use. Capitalizing on their image, celebrities are used as endorsers of
brands in advertisement. The most frequently used definition of celebrity endorser is given by
McGuire (1985): an individual who enjoys public recognition and who uses this recognition on
behalf of a consumer good by appearing with it in an advertisement. Celebrity endorsement is a
heavily employed strategy in advertising because it is more effective than celebrity-less
endorsement in terms of producing desirable outcomes for the sponsor. Celebrities are seen as
more attractive (likeable) by consumers (McGuire, 1985) and therefore more readily identifiable
(Kelman, 1961). Celebrities are also looked upon as more expert and trustworthy than noncelebrities (Ohanian, 1990). As a result, consumers identify with celebrities and internalize the
‘things’ they say about the endorsed products (Kelman, 1961).
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Increasingly, celebrities engage in business not just as endorsers but also with a financial stake
and decision-making role in the business. Hunter (2010) defines celebrity entrepreneurs
as
individuals who are known for their well known-ness and take part both in owning or running a
venture (or are portrayed as doing so) (p. 2). The launching of their new products is usually
reported by the media; hence, creating publicity to the celebrity and the venture. The association
with the company makes the celebrity an endorser of the company and product (Kamen, Azhari
& Kragh, 1975). It is understood that by default all celebrity entrepreneurs are celebrity
endorsers but not all celebrity endorsers are celebrity entrepreneurs. Since celebrity
entrepreneurs are also endorsers, a reasonable way of researching celebrity entrepreneurship is
through a celebrity endorsement framework.
Celebrity Endorser Credibility
Source credibility construct has been studied by many social scientists in the past several decades
in order to understand its effect on message persuasiveness (Hovland & Weiss, 1951; Sternthal,
Dholakia & Leavitt, 1978; Goblieb & Sarel, 1992; Pornpitakpan, 2003; Ohanian, 1990). In a
review of the source credibility literature over the past five decades, Pornpitakpan (2004)
discovers that the majority of studies undertaken indicate that perceived source credibility has
some degree of influence on communication effectiveness. In advertising context, such
credibility is often associated with a model or an endorser (Friedman & Friedman, 1979; Patzer,
1985; Ohanian, 1990, 1991), the advertiser (MacKenzie & Lutz, 1989), the advertisement
(MacKenzie & Lutz, 1989), corporate credibility (Lafferty & Goldsmith, 1999; Goldsmith,
Lafferty & Newell, 2000a; Newell & Goldsmith, 2001), or web credibility (Choi & Rifon, 2002).
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The Source Credibility Model derived from seminal work of Hovland, Janis & Kelley (1953),
contend that expertise and trustworthiness are the essential factors leading to the perceived
credibility of a message. Expertise is defined as the extent to which a communicator is perceived
to be a source of valid assertions about the object or issue, and trustworthiness was referred to as
the degree of consumer’s confidence in the communicator’s intent to communicate the assertions
she or he considers most valid (Hovland et al., 1953).
On the other hand, the Source Attractiveness Model originates from McGuire’s Source Valence
Model (McGuire, 1985). It has attractiveness as the third component of source credibility.
Attractiveness refers to the perceived attractiveness of the source (Josepth, 1982; Kahle &
Homer, 1985; Kamins, 1990; Ohanian, 1991; Patzer, 1985). Source attractiveness in the context
of message effectiveness (and communication) is said to depend on source’s familiarity,
likability, similarity and overall attractiveness to the receivers (McGuire, 1985; Ohanian, 1991).
Familiarity is considered knowledge of the source through exposure, whereas likeability is
affection for the source as a result of the source’s physical appearance and behavior; and
similarity is the supposed resemblance between the source and the receiver of the message
(McGuire, 1985).
Findings from the source credibility studies have been questionable as they regard the celebrity
endorsement process as uni-dimensional, thus unable to provide a well-grounded explanation of
important factors (Erdogan, 1999). Given the pervasiveness of the usage of celebrities in
advertising, a valid instrument for measuring celebrity endorser’s credibility was deemed
important for assessing the possible impact of using such individuals. Ohanian (1990)
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synthesizes previous literature on source effects and proposes three components of celebrity
endorser credibility: trustworthiness, expertise and attractiveness. Endorsers who are perceived
to be knowledgeable, honest and physically attractive are considered credible and in turn, induce
positive attitudinal and behavioral responses from consumers (Ohanian, 1991). Table 1 displays
the three dimensions of celebrity endorser credibility scale with their corresponding items as
proposed by Ohanian (1990).
Table 1: Celebrity Endorser Credibility Scale
Attractiveness
Trustworthiness
Expertise
Attractive-Unattractive
Trustworthy-Untrustworthy
Expert-Not expert
Classy-Not classy
Dependable-Undependable
Experienced-Inexperienced
Beautiful-Ugly
Honest-Dishonest
Knowledgeable-Unknowledgeable
Elegant-Plain
Reliable-Unreliable
Qualified-Unqualified
Sexy-Not Sexy
Sincere-Insincere
Skilled-Unskilled
Source: Ohanian (1990)
Negative Publicity and Celebrity Decorum
The literature on celebrity endorsement focuses more on its positive effects and potential benefits
for advertisers, while research on negative effects is scant and mostly from a western
perspective. Scholars and practitioners report that the greatest fear in hiring celebrity is when the
celebrity’s image becomes “tarnish by allegations of illicit, unethical, unusual, or even slightly
unconventional behavior” (Miciak & Shanklin, 1994, p. 53), thus instantly create problems for
the endorsement contract (Erdogan, Baker & Tagg, 2001; Charbonneau & Garland, 2005; Louie,
Kulik & Johnson, 2001; Money et al., 2006; Till & Shimp, 1998). The problem arises as to how
negative publicity about the celebrity endorser is associated with the brand being endorsed.
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There is the possibility that celebrity endorsers who are entwined in destructive scandal transfer
the negative repercussion to the endorsed product and company, just like positive information
about their performance and achievements create their value or equity as endorser. The negative
publicity might affect their credibility as endorsers in the eyes of the consumers to certain
degree.
Celebrities, though popular, are mere mortals with tendencies toward good and bad. The few
studies on negative celebrity effects (e.g. Hunter & Davidsson, 2008; Louie & Obermiller, 2002;
Money, Shimp & Sakano, 2006; Till & Shimp, 1998) use the term negative information to
describe celebrity’s involvement in undesirable events such as incurring injuries, dealing with
substance abuse or getting caught engaging in unlawful behaviors (Louie, Kulik & Jacobson,
2001). As even the most mundane information about the celebrity is newsworthy (Boorstin,
1961; Pringle, 2004) and researchers have long known that negative is more attention grabbling
than positive information (Fiske, 1980; Klebba & Unger, 1982), the effects of negative celebrity
information on the endorsement contract is of interest to both, theory and practice.
The effect of negative publicity on a company is dependent on how personally responsible its
spokesperson was. Louie et al. (2001) report that a company’s stock performance is affected
based on whether the celebrity is blameworthy or blameless. The more culpable a celebrity was
the more likely the company will experience losses in stock market value. Furthermore, Klebba
& Unger (1982) find that indirectly, negative information may affect attitudes towards the
advertisement and brand by lowering the credibility of the endorser. Till and Shimp’s (1998)
study reveal that negative information resulted in unfavorable attitudes toward the brand, only in
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the case where a fictitious celebrity was used to promote a fictitious brand. Interestingly, when a
real celebrity is used to promote a fictitious brand and negative information given, there was no
significant negative effect to the brand. In a recent study comparing the influence of two types of
negative information – self- oriented and other-oriented, between the U.S. and Japan, Money et
al. (2006) reveal that negative celebrity information did not necessarily produce less favorable
evaluation of a brand.
Based on the literature on the effects of negative publicity on celebrity credibility, we propose
that it is important that the reputation of a celebrity in terms of his/her decorum be included as
part of his/her credibility assessment. A celebrity’s past behavior should indicate that he/she
would be an ongoing asset to the product campaign he or she endorses. Proper decorum or
deportment in potential product endorsers should be part of the ‘base criteria’ to find an effective
spokesperson and limit the risk of advertising backfires (Miciak & Shanklin, 1994; Swerdlow &
Swerdlow, 2003).
Advertisement Credibility
Many previous advertising studies focused on the effectiveness of the source of credibility,
particularly on the role of endorser (i.e. celebrity) per se (e.g. Atkin & Block, 1983; Biswas,
Biswas & Das, 2006; la Ferle & Choi; Ohanian, 1991; Pornpitakpan, 2003). The present study
extends the concept of credibility in celebrity-endorsed advertisement by examining the
believability and trustworthiness of the advertising message/claims presented by the endorsers or
as illustrated in the advertisement. Advertisement credibility refers to the perception of whether
the advertised message or claims made by a company’s advertisement are truthful, believable,
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and reliable and product performance is according to the stated information in the advertisement
(Herbig & Milewicz, 1995; Shavitt, Lowrey & Haefner, 1998).
The concept of advertisement credibility is based on the argument that consumers are motivated
to evaluate the truthfulness of the claims in the advertisement (Kavanoor, Grewal & Blodgett,
1997). In advertising and consumer behavior literature, advertisement credibility has been
defined as the “extent to which the consumer perceives claims made about the brand in the ad to
be truthful and believable” (MacKenzie & Lutz, 1989, p. 51). It refers to the same idea as
advertisement believability as conceptualized by Beltramini (1982): “the extent to which an
advertisement is capable of evoking sufficient confident in its truthfulness to render it acceptable
to consumers” (p. 4). Thus, advertisement credibility focuses on the advertisement and the
consumer’s evaluation of the truth and believability of the contents of the advertisement (i.e. the
visual and verbal components of the advertisement). Similarly, Goldberg and Hartwick (1990)
state that advertisement credibility is the perception consumers have regarding the integrity of a
commercial that encompasses two dimensions: trustfulness and believability. Trustfulness refers
to the perceived authenticity and integrity of the information presented in the advertisement
while believability refers to the perception of an accurate portrayal of reality. Consumers will
interpret the advertisement itself (rather than only the source) to determine if the claims it makes
are true (Cotte, Coulter & Moore, 2005).
Advertisement credibility is a key advertising attribute as consumers are not likely to respond to
advertising in the desired manner if they do not believe what the advertisement is trying to
convey (Beltramini & Stafford, 1993). The advertisement that is perceived as credible tends to
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have a greater degree of message acceptance. Many studies have demonstrated the positive
impact of advertisement credibility on advertisement outcome measures such as brand attitude
and purchase intention (Deshpande & Stayman, 1994; Ohanian, 1990). Moreover, advertisement
credibility can generate positive impression on the celebrity endorser’s, company’s and brand’s
images particularly in beauty-related products. For example, skincare consumers may expect and
hope the advertised brand of products would perform as presented by the celebrity endorser and
advertiser. However, if the information in the advertisement is misleading or deceptive, the
image of the product, endorser and advertiser may deteriorate as a consequence.
Nevertheless, previous studies have shown that the public tend to have negative view towards
advertising claims made by advertisers (O’Donohoe, 1995). For example, Mittal (1994) found
less than a quarter of his respondents perceived that television commercials are honest and
believable. Andrews (1989) found that majority of his respondents agreed that advertising does
not present a true picture of what is being advertised. Similarly, Alwitt and Prabhaker (1992)
found that most of their respondents agree that advertised products did not perform according to
claims made by television advertisements. In addition, Shavitt et al. (1998) examined the general
consumer’s perceptions and attitudes toward advertising among different demographic segments.
They concluded that American generally do not trust advertising, however, when it comes to
their actual purchase decisions they tend to base their choices on advertising claims.
Advertising Effectiveness
In advertising studies, three traditional measures of effectiveness are commonly used: attitude
toward the ad (AAD), attitude toward the brand (ABR), and purchase intention (PIN). As such,
this study will adopt the above measures as representing consumers’ responses to advertisement
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endorsed by the celebrity entrepreneur-cum-endorser. In general, findings from previous studies
strongly indicate that these constructs are related and impact consumer purchase behavior. Thus,
they serve as useful measures of advertising efficacy. Illustrations of sequential path of influence
from AAD to ABR, which subsequently impact PIN can be found in many studies (e.g. Lafferty,
Goldsmith & Newell, 2002; MacKenzie, Lutz & Belch, 1986; MacKenzie & Lutz, 1989).
Shimp (2008) was among the first to suggest that AAD is a mediator of consumer brand choice
and empirically examine the AAD-ABR linkage and found that advertising content significantly
impacts ABR, PIN and the act of buying. As more companies hire celebrities to represent their
brand, it is imperative that they understand the factors that influence consumers’ attitude toward
celebrity endorsed advertisements. Below is the conceptual model postulating relationships
amongst constructs in this study.
Figure 1: Hypothesized Model
Celebrity
Credibility
H1
H2
Attitude toward
the
Advertisement
H6
H5
Purchase
Intention
H3
Advertisement
Credibility
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H4
Attitude
toward the
Brand
H7
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Based on the above discussion, we suggest and test the following hypotheses:

H1: Celebrity credibility has a positive influence on attitude toward the ad.

H2: Celebrity credibility has a positive influence on attitude toward the brand.

H3: Advertisement credibility has a positive influence on attitude toward the ad.

H4: Advertisement credibility has a positive influence on attitude toward the brand.

H5: Attitude toward the ad has a positive influence on attitude toward the brand.

H6: Attitude toward the ad has a positive influence on purchase intention.

H7: Attitude toward the brand has a positive influence on purchase intention.
METHOD
This study adopts a quantitative methodology via a cross-sectional survey. A self-administered
questionnaire based on extant literature and focus group discussions was conducted to test the
proposed hypotheses. An actual magazine advertisement featuring a real celebrity entrepreneur
endorsing her own brand of skincare product was attached as stimulus. The celebrity selected
was Malaysia’s number one songstress, Dato’ Siti Nurhaliza (Siti) who created history in
Malaysia’s entertainment scene with unprecedented number of music awards since her debut at
the age of 16. From the beginning of her career, she was portrayed as a modest and conservative
singer, refusing to wear revealing attires and taking picture with man for magazine covers. Her
reserved image was the subject of appraisals and positive feedback from Islamic scholars from
Malaysia and Indonesia. Frequently, she was cited as an idol and as an inspiration by many
Malaysians and non-Malaysian artists alike.
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Siti also took part in philanthropic activities by giving generous donations to tsunami victims,
National Anti-Drug Campaign, Nurjiwa Foundation (a foundation founded together with
husband, Dato’ Khalid Mohd Jiwa, as a platform to help needy people through charity concerts
and dinner events) and build a number of mosques in Kuala Muda, Kuala Lumpur and Pattani,
Thailand. Owing to her success as an artist and sparkling image, she was nominated as the
cultural ambassador for the Malay community and her image likeness was used as part of the
promotion by Malaysian Ministry of Tourism. Furthermore, Siti has been an ambassador and
spokesperson for various international products such as Jusco, Maxis, Maybelline, Minolta,
Mitsubishi, Olay, Pantene, Pepsi, Samsung and TM Net.
With success in her singing career, Siti also got herself involved in business by setting up her
own company with activities generally in the entertainment industry. Then again, she recently
ventured into the beauty industry by launching her own skincare and cosmetics products under
the label ‘SimplySiti’. The products are manufactured in South Korea under strict supervision by
SimplySiti Sdn. Bhd. so as to guarantee high quality and ‘halal’ (permissible to use under
Islamic law). Being known as a formidable, successful and well-known businesswoman in
Malaysia, Siti currently tops the list of the ‘Richest Artistes’ in Malaysia and was also named as
one of the millionaires in entertainment in South East Asia as well.
With these amazing
achievements and shining image, Siti makes an appropriate case for us to explore our conceptual
model for the study.
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Sample and Procedure
Population of the study consists of females 18 to 55 years old, residing or working in the Klang
Valley, Malaysia. Females are targeted because they are the main users of skincare products.
Respondents were screened on two criteria: (1) familiarity with the celebrity endorser portrayed
in the advertisement and (2) never used the brand endorsed in the advertisement. As no sampling
frame was readily available, quota sampling approach was used based on ethnic and age factors.
900 questionnaires were distributed via drop-and-collect approach at various organizations in
several stages for three months.
Out of the 625 survey forms that were returned, 83 were discarded due to invalid responses
(monotonous and many incomplete answers), thus excluded from analyses. This yielded 542
usable questionnaires which resulted in approximately 60.2% response rate. Of the 542
respondents, 72% were Malays, 17% Chinese and 11% Indians. Chinese respondents were less
than the intended number because they could not recognize the celebrity. Each respondent was
instructed to view the stimulus advertisement as if they were reading it from a beauty magazine
and then completed a standard questionnaire which contained a series of questions regarding the
variables of interest in the study. Drop-and-collect procedure was chosen as method of
collection. Moreover, liaisons from companies, organizations and institutions were contacted and
trained on the collection procedures. Questionnaires were dropped and collected two weeks later.
Questionnaire and Stimulus Design
The survey instrument included measures of celebrity endorser credibility (CEC), advertisement
credibility (ADC), attitude toward the advertisement (AAD), attitude toward the brand (ABR) as
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well as purchase intention (PI). The measurements for CEC were adapted from Ohanian (1990).
However, two items, ‘sexy’ and ‘dependable’ were excluded from the question set because
results from pilot test found those two items to be very poor items (difficult to evaluate). A new
dimension was added to CEC to capture the notion of decorum or mannerism that contributes to
the credibility of the celebrity in the context of Eastern value and culture. The items for celebrity
decorum include ‘friendly’, ‘likeable’, ‘kind’, ‘polite’, ‘etiquette’, ‘ethical’, and ‘modest’. Six
ADC items were adapted from Beltramini and Evans (1985). For the attitude and intention
measures, items were adapted from Bruner and Hensel (1992) for AAD; MacKenzie and Lutz
(1989) for ABR; and Yi (1990) for PI. All items were measured using a 7-point Likert scale
from 1=strongly disagree to 7=strongly agree (except for respondents’ demographic
information). Likert scale was used instead of the original semantic differential scale because
respondents from the pilot test had difficulty understanding the later structure.
Once the stimulus advertisement was chosen, permission was solicited from and granted by the
company to use its magazine advertisement in the study (the advertisement is not shown here due
to potential copyright restrictions). To ensure the stimulus advertisement was exactly of the same
quality as the one in the magazine, printing was handled by the university printing centre using
high quality reproduction materials. Print medium was chosen for consistency with earlier
studies on celebrity endorsements.
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DATA ANALYSIS AND RESULTS
Exploratory Factor Analysis (EFA)
In reducing number of item measurements, three exploratory factor analyses (EFA) were
separately conducted on Celebrity Endorser Credibility, Advertisement Credibility and
Advertising Effectiveness constructs comprising of Attitude toward the Advertisement, Attitude
toward the Brand and Purchase Intention. A principal component extraction with oblique rotation
was utilized in reducing these large items to a more manageable set as it has been recognized to
be a valuable preliminary analysis when sufficient theory is unavailable to establish the
underlying dimensions in a specific construct (Anderson & Gerbing, 1988). In order to achieve a
more meaningful and interpretable solution in this purification process, items with low factor
loadings (< 0.5) or high cross-loadings (> 0.3) were dropped (Hair et al., 2010). Then another
round of EFA was performed. The results for all emerging factor structures within the respective
constructs showed high factor loadings and the alpha coefficients of these factors ranged from
0.93 to 0.97, well above acceptable value of 0.70 (Sekaran, 2009). This clearly indicates that the
scales used in this study were highly reliable (Nunnally, 1978).
Confirmatory Factor Analysis (CFA)
Confirmatory factor analysis, a more rigorous statistical procedure was applied to refine and
confirm the factor structures obtained from initial EFA. CFA has been proposed as an analytical
tool to ascertain unidimensionality of measures (Alexandris, Kouthris & Meligdis, 2006).
Therefore, all measures obtained from EFA were then submitted and validated using CFA
analytic procedure by employing AMOS 18. In order to achieve an acceptable ratio of
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observations to estimate parameters, two separate measurement models were conducted using
CFA.
Measurement Model 1
The first measurement model consists of four-factor solution of celebrity credibility construct
and two-factor solution of advertisement credibility. The overall fit indices (χ2 = 634.34, df =
223, p< 0.001, GFI = .90, NFI = .96, CFI = .97, RAMSEA = .06) indicate good model fit.
Convergent validity and reliability was assessed by examining the magnitude and significance of
the factor loadings (standardized regression weight) and their associated t-value. It was also
assessed with the evaluation of average variance extracted (AVE) and composite reliability (CR)
of each construct. Structural equation modeling requires a more stringent test of reliability by
examining the AVE and the Composite Reliability, in addition to Cronbach’s alpha. Items were
loaded on their posited variables with standardized coefficients greater than 0.5 cut-off point and
t-value ranged from 16.55 to 46.70. From the result, it can be claimed that convergent validity
has been achieved. Table 2 summarizes the result of the measurement model 1. The reliability of
the variables were also achieved with AVE value greater than the threshold value of 0.5
(Anderson & Gerbing, 1988), composite reliability value greater than the threshold of 0.6
(Bagozzi & Yi, 1988) and Cronbach’s alpha greater than the cut-off value of 0.7 (Anderson &
Gerbing, 1988). Composite reliability reflects the internal consistency of the construct indicators
while AVE indicates the amount of variance captured by the construct indicators (Gerbing &
Anderson, 1988).
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Discriminant validity was established through low correlations between the constructs and is
evident when the correlation between factors was lower than 0.8 (Yanamandram & White,
2006). The correlations between each latent variable were lower than 0.8 except for the
correlation between advertisement believability and advertisement honesty (r=0.85). Although
this high correlation is consistent with the hypothesis it may suggest that these constructs
essentially represent the same construct. To address this concern, Fornell and Larcker’s (1981)
more rigorous method of assessing discriminant validity was applied. It was found that AVE for
each construct was greater than the squared correlation between the variable and any other
variables in the construct, which in this measurement model indicates that discriminate validity is
achieved (see Table 2).
Table 2: Summary of Results of Measurement Model 1
Variable
X1
Celebrity
Attractiveness (X1)
Celebrity
Trustworthiness (X2)
Celebrity Expertise
(X3)
Celebrity Decorum
(X4)
Advertisement
Believability (X5)
Advertisement
Honesty (X6)
1
0.71
(0.50)
0.58
(0.34)
0.74
(0.55)
0.59
(0.35)
0.57
(0.32)
X2
X3
X4
X5
X6
1
0.65
(0.42)
0.76
(0.58)
0.63
(0.40)
0.65
(0.42)
1
0.61
(0.37)
0.59
(0.35)
0.62
(0.38)
1
0.64
(0.41)
0.64
(0.41)
1
0.85
(0.72)
1
CR
AVE
Α
0.91
0.72
0.95
0.92
0.75
0.96
0.91
0.71
0.93
0.88
0.59
0.93
0.92
0.80
0.96
0.88
0.77
0.93
Note: The numbers in the brackets represent the squared correlation values between constructs of the respective column and row.
AVE = average variance explained; CR = composite reliability
Measurement Model 2
The second measurement model consists of three constructs namely attitude toward the
advertisement, attitude toward the brand and purchase intention. Goodness-of-fit indices
supported the acceptable fit of this model (χ2 = 128.66, df = 41, p<0.001, GFI = .96, NFI = .98,
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CFI = .99 and RMSEA = .063). The results of individual factor loadings revealed that all paths
had standardized factor loadings substantially above 0.70. The model was further assessed by
obtaining CR and AVE for each construct. As shown in Table 3, all constructs met the
recommended level of 0.70 for CR and 0.50 for AVE, demonstrating the reliability and
convergent validity of each construct. Discriminant validity is established in this measurement
model as the correlation coefficients range from 0.73 to 0.68, below the cutoff point of 0.8
(Yanamandram & White, 2006). For a rigorous test of discriminant validity, the AVE of each
construct was manually computed and found to be greater than the squared correlation between
that construct and any other constructs in the model (see Table 3). In conclusion, it is reasonable
to claim that all the measures used in this study possess adequate psychometric properties.
Table 3: Summary of Results of Measurement Model 3
Variable
Ad Attitude –X1
Brand Attitude – X2
Purchase Intention – X3
X1
X2
X3
1
0.78
(0.61)
0.73
(0.53)
1
0.78
(0.61)
1
CR
AVE
Α
0.91
0.76
0.96
0.93
0.73
0.97
0.92
0.80
0.97
Note: The numbers in the brackets represent the squared correlation values between constructs of the respective column and row.
AVE = average variance explained; CR = composite reliability
Structural Equation Modeling (SEM)
SEM was subsequently performed in order to test the seven hypothesized structural relationships
of celebrity credibility and advertisement credibility with advertising effectiveness in the context
of celebrity entrepreneur-endorser advertisement. The structural model has a significant χ2 value
(χ2 = 83.01, df = 23, p < 0.001), indicating inadequate fit of the data with the hypothesized
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model. Even though the chi-square value was significant (p < 0.001), reliance on the chi-square
test as the sole measure of fit in a structural equation model is not recommended due to its
sensitivity to sample size (Gerbing & Anderson, 1988; McCallum, Browne & Sugawara, 1996).
Hence, the overall fit of the model was assessed using alternative fit indices. The goodness-of-fit
indices employed (GFI = .97; CFI = .99; NFI = .98; RMSEA = .069) suggest that the model fits
the data satisfactorily. Consequently, this model was retained without any further modification.
Hence, the study’s attempt to establish a plausible model that has statistical and explanatory
power, which could permit confident interpretation of results, was thus fulfilled. Table 4 presents
the results of the tested hypotheses. It was found that all the hypothesized paths were supported.
Table 4: Results of the Hypotheses Tested
Hypothesized Paths
Standardized
Coefficient
Critical ratio
(t-value)
Results
H1
Celebrity Credibility → Attitude toward the Ad
0.28
4.65****
Supported
H2
Celebrity Credibility →Attitude toward the Brand
0.13
2.76***
Supported
H3
Ad Credibility → Attitude toward the Ad
0.34
4.24****
Supported
H4
Ad Credibility → Attitude toward the Brand
0.21
3.34****
Supported
H5
Attitude toward the Ad → Attitude toward the
Brand
0.54
14.30****
Supported
H6
Attitude toward the Ad → Purchase Intention
0.24
3.97****
Supported
H7
Attitude toward the Brand →Purchase Intention
0.60
10.10****
Supported
Note: **** Significant at p< 0.001 (t> ± 3.29)
*** Significant at p< 0.01 (t> ± 2.57)
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** Significant at p< 0.0.05 (t> ±1.96)
* Significant at p< 0.10 (t> ± 1.65)
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DISCUSSION
This study sought to understand the effects that celebrity credibility and advertisement credibility
have on advertising effectiveness when the celebrity who endorses the product in the
advertisement is also a celebrity entrepreneur who owns the product as well as the company. The
scanty literature on celebrity entrepreneurship argues that from the perspective of the consumers,
there are more similarities than differences between a celebrity entrepreneur and a celebrity
endorser (Hunter, 2010).
However, with increasing reports of notorious celebrities and the pending damage on their
endorsement contracts, celebrity decorum is proposed to be among the main characteristics to
determine celebrity credibility. Findings from this study revealed that indeed celebrity decorum
is the main attribute influencing celebrity endorser credibility, followed by celebrity
trustworthiness, celebrity expertise and attractiveness; at least from the perspective of Malaysian
respondents. Most empirical evidence of consumers’ attitudinal and behavioral responses to
advertisements endorsed by celebrities found that attractiveness (Chaiken, 1979; Dion,
Bersscheid & Walsters, 1972; Horai, Naccari & Fatoullah, 1974; Shavitt, Swan, Lowrey &
Waenke, 1994) and trustworthiness (Despande & Stayman, 1994; McGinnies & Ward, 1980;
Pornpitakpan, 1998, 2002, 2003) positively influences persuasion. However, in this study,
attractiveness, though significant, was found to be the least predictor to celebrity credibility. This
is surprising considering that the product endorsed in the advertisement was attractiveness
related.
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With regards to advertisement credibility, it is found that both advertisement believability and
honesty equally play a role in determining positive evaluation for advertisement credibility. The
claims on the efficacy of the skincare product in the stimulus advertisement were simple and
straightforward, and in the language that was understood by the audience. Meanwhile, the visual
aspect of the advertisement portrayed the celebrity endorser in her normal appearance not edited.
The results also showed that celebrity credibility and advertisement credibility had a positive
association with both attitudes toward the advertisement and the brand. These results imply that
in the case of celebrity entrepreneur, consumers may look up to the credibility of the celebrity as
well as the advertisement in terms of forming positive attitudes toward the advertisement and the
brand. However, advertisement credibility proves to be the main contributor to both, AAD and
ABR. It means that even in advertisement endorsed by celebrity, consumers still look up to
truthful and honest advertisement messages in forming positive attitudes toward the
advertisement and brand.
AAD and ABR serve as mediators to the relationship between celebrity credibility and
advertisement credibility with purchase intention. Whereas some very early research indicated
the link between attitudes and behavior was not highly correlated, more recent research has
indicated that attitudes substantially mediate behavioral intentions (Fishbein & Ajzen, 1975;
Mitchell & Olson, 1981).
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LIMITATIONS AND FUTURE RESEARCH
This research has several limitations. Caution must be taken to generalize the findings of this
study beyond the celebrity entrepreneur and the brand featured in the stimulus advertisement.
The study should be replicated across different celebrities, brands and product categories.
Rosenthal and Rosnow (1984) suggest that a study needs to be replicated as many as fifteen
times before results can be generalized, indicating that further work on this model is necessary to
generalize the findings.
It may be fruitful for future research to replicate and validate all or parts of the present model in
order to determine the robustness of the findings in other cultures, eastern or western.
Comparative cross-national studies are essential in order to examine the generalizability of the
model. This research direction appears to be potentially fertile because celebrity entrepreneurship
and celebrity endorsement are global phenomenon. It is also deemed important that future study
be undertaken to extend the present model by integrating company credibility, media credibility,
or other advertising effectiveness constructs such as brand recall. It is also suggested that for
future research some moderating variables such as attitude toward advertising in general, mood,
fan status or celebrity worship may be considered, which may be able to explain any additional
differences that may crop up.
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