Asia Marketing Journal

Korean Marketing Association (한국마케팅학회)
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The Dark Side of Star Marketing: Celebrity Endorsement Contracts Can Lower Consumers' Judgment of Brand Growth When the Firm is Tech-Focused

  • Jang, Hojoon (College of Business Administration, Seoul National University) ;
  • Lee, Kyoungmi (College of Business Administration, Seoul National University)
  • Received : 2018.07.24
  • Accepted : 2018.10.11
  • Published : 2018.10.31
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Abstract

This research examines how the announcement of a celebrity endorsement contract with a brand can influence consumers' judgment of its future growth in a market. Using both behavioral experiments and an event study analysis, we find that when the brand is perceived to be technology-focused (versus marketing-focused), the information about the celebrity contract can lead consumers to view the brand's future as less promising. Furthermore, we identify consumers' inferences about the quality of the brand as a psychological factor underlying this effect. This paper provides evidence that star-marketing can sometimes signal management's misjudgment about resource allocation for a brand, which unduly invests in celebrity marketing at the expense of quality improvement for the product.

Keywords

Acknowledgement

This work was supported by the SNU Institute of Management Research

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