Image courtesy of Savatore Vuono/ FreeDigitalPhotos.net. For example, several sports companies sell and produce the same products NIKE does and this … He has been the celebrity marketer for sports and Shoe Company known as NIKE. Endorsements can be effected by means of a statement to the public or by the endorsing party using it for all to see. Celebrity endorsements are not short-term tactics. Advantages of Celebrity Endorsement Can Build Brand Equity Celebrity endorsement can make it easier for a brand taps into new markets. The benefits of using a celebrity for advertising are the ability to: We do not spam. Companies spend millions on celebrity endorsements. According to research by Harvard Business School professor Anita Elberse and Barclays Capital analyst Jeroen Verleun, a celebrity endorsement increases a company’s sales an average of 4% relative to its competition, and also increases a company’s stock value by 0.25%. When Tiger Woods was involved with several sex scandals and cases of infidelity, his reputation changed for the worst and many people viewed him negatively. Endorsement is a channel of brand communication in which a celebrity acts as the brand’s spokesperson and certifies the brand’s claim and position by extending his/her personality, popularity, status in society or expertise in the field to the brand. If they use your product, it shows their fans that it is a product worth using and builds trust in your brand. When a business utilizes the services of a celebrity to promote products or services, then this advertising option becomes a way to differentiate their brand from their competition. Celebrity endorsements don’t just take the form of adverts – celebs are often paid to tweet about products, with companies generously supplying them with goodies. In 2005, Gap replaced her with Joss Stone and Keith Urban, who are more likely to wear Gap-style clothing in the public eye. As a company it is recommended that certain aspects should be examined before signing up for celebrity endorsement of products. Other companies such as General Motors and Gillette withdrew from him but NIKE stuck with him. Here is how a celebrity endorsement could increase your brand recognition, ensuring your product or service successfully stands out from the crowd. And you can unsubscribe when you want. Helps Personify Your Brand. The company’s manager states that the company is humbled and thrilled to still be in partnership with Tiger Woods, who has been the company’s product promoter for years, through a contract that was signed recently. From Humphrey Bogart and Lauren Bacall advertising Robert Burns Cigarillos and Betty Davis selling Lustre Cream Shampoo to Bill Cosby and Jello Pudding, companies have long loved using celebrities to endorse their brands. A true celebrity can help expand reach, but they might goof up and do something stupid, which could ultimately hurt your brand. Yet even if a celebrity is a good fit for the brand, using one for endorsements has its own set of possible risks: Thinking about using a celebrity for endorsement? But you might want to think twice—it’s a possible minefield. But over the years, many aspiring brands in Asia have jumped on to this celebrity endorsement bandwa… 11, No.1, pp. These include; The reputation of a company may be destroyed as a result of celebrity scandals. For example, a company may be involved in legal issues or bankruptcy which may lead to loss of customers and their faith in the company; with the use of a celebrity to promote the product the company is able to build its rapport. Big … While obvious advantages of brand recall, greater recognition and association of the brand with the celebrity's stature and personality are always there, it comes with the potential downside when the brand gets associated with the attributes of the endorser and the latter's behaviour becomes contrary to the acceptable societal norms. Please try again. Associations with popular names can boost sales, especially when customers believe the endorser actually uses that particular product. If the celebrity endorsing a brand is well-known then people – especially diehard fans – are more likely to pay attention. (For more information on brand promises, read FrogDog’s article series on branding.) acting, music, athletics, etc., celebrities are individuals who have ascended to the upper echelon of society. Our monthly marketing packages are designed to help businesses who need to quickly add a marketing department or expand the capabilities of their current department. 1. celebrity endorsement have their specialized niche which ranges from music and film, fitness, fashion, sports, etc. Celebrity endorsements can build brand equity. Analysis of US Cost of Recent Wars: Is it Worth it or is it an Economic Burden? Nonetheless, celebrity endorsement can be good or bad depending on the situation. Analysis of Carbon Price Mechanism in Australia. Through such instances the use of a celebrity becomes a disadvantage to the company and the consequences pose a great threat to the company. When a celebrity features in several advertisements involving different products, the audience may get carried away and forget the main thing, which is the product, and focus only on the celebrity. The public may see this as just a way for the celebrity to make money and the credibility of the product may suffer due to this; customers may doubt the quality of the product and this would be bad for business. Whether adored for physical attributes, wealth, or skills in a particular discipline i.e. This activity involves letting the audience know the name of the product, what it is, what it is used for and also gives information on the benefits of using that product. Not all celebrities fit with all brands. … Advantages and Disadvantages of Celebrity Endorsement in Marketing, Current Medicaid Modernization in New Mexico. An entrepreneur may lack the ideas to add quality to his or her product but through advertisement and celebrity endorsement, the product gains credibility in the market. That is why the companies are so much eager to hire them to promote their goods and services. Builds credibility; People are attached to their favorite celebrity, and they are generally well-trusted by their fans. In a market with a very high proliferation of local, regional and international brands, celebrity endorsement was traditionally thought to provide a distinct differentiation. The most sincere celebrity endorsements happen when the celebrity actually uses the product. Celebrity endorsement will give companies a competitive advantage over similar brands. Brand equity will be improved due to celebrity endorsement (Farrell, Karels, Monfort and McClatchey, 2000; Erdogan et al., 2001). Tweet; There are a lot of obvious pros and cons of having a celebrity endorse your product or service. This allusion of quality as a result of the products being used by the celebrities springs from the fact that th… The above points are advantages of using a celebrity in promoting products, but on the other hand several disadvantages come with the use of celebrities in product marketing. And who can forget Brooke Shields’ famous line, “You wanna know what comes between me and my Calvins?”. Now of course as a consumer myself, in not only the fashion but also the beauty industry, I can see both the pros and cons of celebrity endoresements on a company’s profile. Turning to celebrities to promote your products is a natural way to build brand awareness and credibility. Below are the advantages and disadvantages of using a celebrity as an endorsement to the company’s products. Popularity The major reason why many companies use this strategy is to ride on the popularity of their celebrity … When NIKE signed a contract with Tiger Woods to promote their sportswear, the company’s product which includes caps, T-shirts, bands, shoes, and track suits; the products earned the trust of many athletes from different categories of sports including tennis, athletics, and basket-ball (Koekemoer, 2004). 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