10 Surprising Facts about Celebrity Endorsement

The market bigwigs as well as the new entrants in the sector rely and fix a greater amount of fund on a proper marketing strategy- like proper marketing, digital marketing, and publicity of the commodity. One of the most crucial parts is the endorsement of any product or commodity by a big celebrity, hoping to get a boost in sales and escalated profit and revenues. Companies use all their might in getting the celebrity of their choice, money flows like water, and what comes on reel is a life like adoption of product by the concerned celebrity.

What we forget is that sometimes the endorsements make the brand or just break the brand. To cope up with issues, brands resort to fake claims and become the market rulers. But sadly that doesn’t continue for long. Fake claims and ads have a dark story that is mostly hidden from the end consumer. This post will give an insight of the interesting facts about the celebrity endorsements.

Enjoy reading!

1 Only Credible Celebrity Will Make Your Product A Success

Celebrity endorsement is a well-established marketing tool. The theory behind it is about borrowing glow from the celebrities, their interest, awareness in a certain product, and then applying it to our own lives. According to a 2011 study published in the Journal of Advertising, the strategy appears to work, and was backed by a survey of athletes supporting some brands. The result showed a 4 percent increase in revenue (about $ 10 million a year in aggregate sales), and an increase of 0.25% in dividends.

Barbara Kahn, director of Wharton’s Jay H. Baker Retailing Center, asks to choose a celebrity who evokes positive emotions in the target market. She adds on that it should be only someone who has a great power to attract, someone who is nice to talk to, and moreover a nice person. This gives credibility.

2 Celebrities, Brands, and the Impact on followers

Celebrity Endorsement

To advertisers, not only are the celebrities most valuable but also their fans on social media sites, suggests another Nielson study. According to the study, 64% of US adults who follow an online celebrity also follow a brand, and that the guy following a celebrity is four times more likely to follow a brand than the average online adult in the US. Also included in the study was that these people often give advice and opinions to other online consumers.

Orbit+ Co is a social media strategy firm near Boston, Massachusetts. According to its founder Mark Bonchek,

“A celebrity endorsement functions as a signal or trigger. People are looking for a sign. If they see a celebrity they like [endorsing a product], it sends a signal that the product is good and becomes part of the conversation of consumers when they talk about a brand or product.”

Thus, positive impact of social media followers from celebrity accounts is a must as it may reflect indirect branding to your campaign.

3 Rethink if you think every successful brand and every successful celebrity ensures a great marketing campaign

Looking back to a perfume TVC by Chanel No 5, starring Brad Pitt, one realizes that howsoever big a brand is, its TVC gets screwed up with a celebrity’s fault and becomes a laughing stock. Chanel’s advertising team realized that the perfume ad starring Brad Pitt as a distressed man facing an existential crisis, turned out to be a not-so-brilliant piece of marketing. The black and white shot commercial shows Brad Pitt in a meditative and unshaven – alone in a room.

“It’s not a trip,” he says head down. “Every journey comes to an end, but we go on, the world goes round, and we spin with it, the plans leave the scene, dreams take their place, but wherever I go, you accompany me: mine Luck, my destiny, and my joy.”

Chanel executives expected the commercial to be a hit but contrary to their expectations, it turned out to be viral – but for being ridiculous. Conan O’Brien made a parody of the ad in his talk show- Parody on Saturday Night Live and “practically everyone on the Internet” made fun of him (Source: The Huffington Post).

This ad was a misconception of a series of failures involving celebrities hired to promote a brand. Mostly it becomes a laughing material, thus undermining the brand they were actually promoting. It is sometimes the fault of the poor marketing campaign, or the celebrity’s.

4 Social Media and the increased answerability- A boon or a bane for celebrities

The pace at which the social media is progressing has made it difficult to manage brand image. Patti Williams, Marketing professor at Wharton, says that calling a celebrity to be the spokesperson of the brand increases the degree of risk involved. In the traditional ways the celebrity and brand relationship continued only till the participation in the commercial, but now it has reached a point where celebrities are asked to interact with the company’s clientele, through the company’s or celebrity’s social media.

This is the cause of most of the risks as the celebrity becomes an answerable entity in case any issue arises, and this isn’t a good thing, for the brand as well as the celebrity.

According to a report last year from Nielson, 20 percent of the time people spend on the desktop is dedicated to social media, and 30 percent of the time spent on mobile devices is spent on social networks. About 17 percent of the time consumers spend on the PC is spent on Facebook.

In the social media segment, celebrities have more prestige and influence than brand. On Twitter, Justin Bieber has 34.5 million followers, and Oprah Winfrey, 16.6 million. The most popular brands that try to pass a “cool” image usually have a much smaller number of followers. Starbucks has 3.4 million Twitter followers; Rolling Stones has 2.3 million and Gap 177,000.

Today, a wrong endorsement becomes a target of mass mockery. It may not permanently affect the brand, but it is short-term damage deadline.

5 The power of a customer-to-customer talk

A customer-to-customer interaction is something that the companies have in their marketing plan but it is equally risky as well. A casual meeting talk or one around the office drinker is very different from what is said on a social network like Facebook.

About ¾ of social media users learn about brands and the experiences people had only through the access to social networks, reports Nielson. Of these, about 65% want more information about products and services offered by brands; 53% want to praise a brand and 50% want to express their concern or complain about brands and services.

David Reibstein, a Wharton marketing professor, says

“Social media allows consumers to express themselves alongside others – this can be positive or negative. If you have a good or funny ad or a really good celebrity, the repercussions on social media can be much higher, but there is a disadvantage in that as well. Everybody wants people to talk about their brand, but they want to do it in a positive or neutral way.”

6 The bad side of public and social influence

David Reibstein opines that the rise in access to social media has made the potential of public opinion greater. In the present scenario, just take a picture of a celebrity [in an ill-timed situation] and you’ll see that the exposure becomes a part of the news cycle for 24 hours a day and seven days a week. Such is the power of social media and a bad word of mouth.

A celebrity, like the general mass, is prone to imperfection and misjudgments. Unlike us, their errors are discussed in detail. When he/she is a brand ambassador, the bad behavior becomes a big problem. Michael Phelps, the most decorated Olympic athlete in history, lost Kellogg’s patronage after a photo of him smoking marijuana appeared in the News of the World.

Tiger Woods lost the patronage of Tag Heuer, Gillette, Accenture, Gatorade and several other companies after it was discovered that he had several extramarital affairs with countless women.

7 Effects of social media inclusion

The misconceptions arising out of a celebrity endorsing a product does not necessarily hurt the image of a product in a specific way. If there is any scale on the basis of which the image is to be judged, it is totally the customer. Also a stumbled sale arising out of any misjudgment can hurt the company for a while.

The inclusion of endorsement in the age of social media brings in another challenge of creating a perfect marketing message. Elimination of comments is not feasible as “there is always a second screen,” says Erik Qualman, professor of digital marketing at Hult International Business School. Also “there’s never a shortage of comments around the ads [on Facebook, Twitter, and other channels.”]

In today’s globally diversified world, a brand seeks to understand what’s being said, and analyzes which is the best, hence taking a smart decision.

8 From extra-ordinary to ordinary

Chanel, in the past, had several movies and exuberant commercials of its Chanel perfume no. 5, spanning several minutes and starring actresses like Nicole Kidman and Audrey Tautou. According to William from Wharton, these ads were so well received that they may have been the cause of mass rejection of the ad starring Brad Pitt.

Social media further gave impetus to the misconception was amplified by social media. The reality is that Chanel had previously done an extraordinary job in social media.

9 What do people think about celebrity endorsements and its effect on brand value?

Harris Interactive conducted a study which showed the majority of people don’t believe the logic of celebrity endorsements adding any value to a brand. From the total surveyed lot, 51% of respondents said that celebrity endorsement had little to no effect on whether they bought one brand over another.

People rather seemed to be more certain that celebrities actually had the potential to harm brands more than they could help them. 55% of respondents believed that celebrities’ negative publicity can have a somewhat (35%) or very (20%) damaging impact on the thing they’re promoting.

10 Why is there a loss of credibility in celebrity advertisement industry?

The primary reason behind celebrity endorsements not holding the same influence as they used to be is because we are bombarded with a plethora of them. The extent of bombardment of celebrity advertisement has reached a level that even the term ‘celebrity’ has now become a dilute term owing to endless supplies of reality TV stars and Internet icons flood into the media sphere.

Another factor that has affected the credibility quotient of celebrities is the level of connection between the celebrity and the product/brand being promoted. It appears, externally, that the closeness of a celebrity to a product/brand in their real life measures the power of the endorsement to the consumer.

Bad casting and oversaturation, along with celebrity scandals has also become a factor promoting the loss of credibility. The progress of technology has led to people losing privacy and an increased ‘scandal factor’ which is exponentially risky for companies to hire big time celebrities in this environment.