Downside of celebrity endorsements

Philippine Daily Inquirer Business Features Section,March 19, 2004

THE FILIPINO hoi polloi has been labeled by many as exceedingly star-struck, enamored to high heavens by artistas. Not surprisingly, political tickets combine popular personalities with career politicians to achieve a halo effect.

Likewise, traditional marketers resort to celebrity endorsers in their bid to popularize lesser-known brands. Unfortunately, not all products or services with this marketing strategy have been successful. Among the poor performers include a detergent brand endorsed by a lady politician, who the market found incredulously hard to believe could even devote time to laundry.

Grand McCracken, author of the journal article, “Who Is the Celebrity Endorser?” states that celebrities are individuals who enjoy public recognition and who use this recognition in behalf of a consumer good by appearing with it in an advertisement. McCracken, who developed The Meaning Transfer Model, widely referred to in consumer researches, states that celebrities, due largely to their career and the roles they assume in movies, sports, etc. have developed their own individual identity, meaning and persona in the minds of their audience. It is these set of meanings that they bring as a value to the products and services they endorse. Celebrities own their meanings because they developed them over time through the course of their work and in full public view.

Locally, the more frequently used endorsers are entertainers, athletes, broadcast journalists and politicians. Ironically, many local brands do not conduct consumer research to validate celebrity appeal and fit to the product or service nor do they refer to any positioning or brand character statement. Most rely on gut feel, celebrity’s present popular appeal and friends, family or agency recommendation.

Many will agree that the use of celebrities has their own downsides and upsides. Academicians and industry practitioners point to the following risks when contracting celebrity endorsers:

Negative publicity.

Brands strongly associated with celebrity endorsers who happen to be targets of highly unfavorable publicity are likely to risk losing their positive appeal and credibility fast. For example, the brand Hertz suffered in image ratings when its endorser, O.J. Simpson was accused of murdering his exwife and her friend.


This happens with long-term contracts. A celebrity endorser may be very popular at the beginning of the contract term but lose his appeal or fame over time while the contract is still active. For example, a young personality may be fit to endorse a perceived young brand in the beginning but as the endorser ages; the same celebrity may no longer have the same impact on the brand’s young target market.


Riding high on the successful use of an initial endorser, some marketers repeat the formula for no real significant reason except to prevent a competitor from using another new celebrity on the rise. Some simply allow the brand to be a launching vehicle for a perceived upcoming star. Others use different celebrities to endorse different product or service variants. Without a strong, cohesive reason or relationship in the use of multiple endorsers, the overall brand image is likely to suffer. The success of Nike’s use of multiple endorsers lies in the brand’s clear-cut positioning in athletics and fitness. Consumers find a perfect fit between Nike and the choice of endorsers among them the late Steve Prefontaine (marathon), John McEnroe (tennis), Joan Benoit (marathon), Michael Jordan (basketball), Tiger Woods (golf) and more recently, a roster of young athletes on the rise, Freddy Adu (soccer), Carmelo Anthony (basketball) and of course, LeBron James (basketball).


On many occasions, earnest marketers capitalize too much on the celebrity’s popular appeal neglecting their brand and message in the ad execution. Hence, overshadowing happens. Marketers are advised to widely use celebrities by ensuring that the brand and celebrity remain to be equally strong elements in the advertisements.


Because of the financial implications of endorsements, celebrities are not wont to welcome other endorsement opportunities. This becomes a problem when a celebrity endorsers brands simultaneously, leaving consumers to wonder whether the celebrity did the endorsement because he truly uses and believes in the product or is simply doing it for the talent fee. An ACNielsen study revealed that locally, celebrities with the most number of endorsements include among others Sharon Cuneta, Charlene Gonzales, Aga Muhlach, Heart Evangelista, Kris Aquino, Donita Rose, Luis Manzano, Bayani Agbayani, etc.

Financial risk.

The use of a celebrity endorsement strategy must be weighed heavily on the basis of its cost effectiveness and specially, the endorser’s fit to the brand.

Nike signed Michael Jordan to an initial $2.5 million contract over five years in the 80s but the Air Jordan line of sports shoes and apparel sold over $100 million in a single year averting any financial risk. Nike inked a contract with Tiger Woods for $100 million over five years. Nike waxes optimistic over the deal that had a fledgling golf business, roughly estimated at one percent of gross Nike revenues, before Tiger Woods.

Last year, Nike signed 18-year old basketball whiz LeBron James to a seven-year contract estimated at $90 million. Nike has about the same time to prove its marketing decision right.