he Ifs & Buts of Celebrity Endorsements

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Globally, celebrity endorsement is a very powerful marketing tool, employed by firms to build their brand equity. In India, the Lux soap is known to have been endorsed way back in 1941 by the then famous film actress Leela chitnis. The introduction of celebrity endorsement in Indian TV advertising is marked by the commercials of 80s featuring Kapil Dev, Sunil Gavaskar and Tabassum endorsing various consumer products. So, the potential of this concept has been well acknowledged, and tried and tested on the Indian soil for over 70 years now. Why Endorse?

The compelling reasons for companies to yield a strategic position to celebrity endorsement in their marketing schemes vary. Very frequently celebrities are roped in during new brand introductions. The basic idea remains to cash on the popularity, credibility and mass appeal of the celebrities which is expected to help raise awareness of the brand, generate positive associations for it, and build purchase intention among its prospective customers. Sometimes, its merely a reactionary step meant to nullify the impact of celebrity endorsement exercised by a competitor. The last decade also witnessed a novel application of celebrity endorsements for crisis management, manifested brilliantly in the Cadbury case to weather the worm storm. What are Frequently Endorsed?

Among the industries that have generously employed this marketing tool, and have reaped healthy dividends are those representing FMCG, consumer durables, automobile, construction, healthcare and gems and jewellery among others . Top 10 Categories in Celebrity Endorsements on TV during Jan-Dec 2010 Rank 1 2 Top Categories Shampoos Toilet Soaps

3 4 5 6 7 8 9 10 Note: Source: AdEx Who Endorses? Ranks India (A are Division based of TAM

Cellular Phone Service Soft Drink Aerated Fairness Creams Cellular Phones Branded Jewellery DTH Service Providers Washing Powders/Liquids Televisions on Media Secondages Research)

Among the public figures, cinema and TV actors, artists and sportspersons are said to be the first choice for endorsements in India, followed by politicians, journalists, activists and some others who have been, or, promise to be very successful in their niche areas. It is also true that a number of ordinary faces also gained celebrity status with their appearance in some iconic ads, like Surfs Lalitaji, the Complan boy and the Rasna girl to name a few.

Note: Figures are based on Secondages Source: AdEx India (A Division of TAM Media Research) Choice of a Celebrity The consideration set of personalities for endorsement must be guided by the nature of customers a brand serves. Its target market or segment can be broadly identified on the following parameters: geographic, demographic, psychographic and behavioural. A company needs to feel the pulse of its customers, as the heart of a successful celebrity endorsement lies there. It decides the avatar a celebrity personifies, the message she communicates and the medium through which it is conveyed. The lingo, accent, dressing and props used in an ad that may appeal to urban customers may not be the most popular and effective ones in rural settings. Similar is the case with distinct genre of celebrities appealing to different members in the same family, say, children, teenagers, housewives and elderly. The role a celebrity plays in an ad depends on the kind of brand being endorsed. When it comes to lifestyle, fashion and luxury products, the entire aura and cult figure of the

celebrity needs to be accentuated. In the minds of consumers, this kind of product is usually placed as an aspirational one and the focus is more on emotional appeal. But when there is a repeat purchase or low involvement product, the functional benefits tend to be highlighted more. Hence, to add to the believability factor, the celebs are usually made to resemble a common citizen representing shared points of pain and happiness. Rocketing Endorsement Fees

Financially, celebrity endorsement is a costly proposition for most companies. With contract fees crossing Rs 1 crore for top celebrities in India, due diligence needs to be carried out to closely estimate the expected returns on investment (ROI). It is thus better advised to take professional help before a company takes a call on celebrity endorsements.

How are Celebrities Valued? In the US, the brand value of a celebrity is indicated by some popular indices like Q score (a function of favourite and familiarity) and Davie-Brown Index (DBI) (a function of appeal, influence and trust.). In addition, a number of renowned publishing houses like TIME, Forbes and Businessweek also come up with their Power & Influence lists every year. In India, several publications like Filmfare and India Today release similar lists valuing celebrities on expertise, likability and trustworthiness factors. After valuation, most of the endorsement deals are carried out through celebrity agents and expert ad agencies.

Top Celebrities Aamir Khan Shah Rukh Khan Amitabh Bachchan Kareena Kapoor Priyanka Chopra Deepika Padukone

Expertise Actor Actor Actor Actress Actress Actress

Endorsement Fee Rs 35 crore Rs 15 crore Rs 1-12 crore Rs 25-3 crore Rs 2-25 crore Rs 15-2 crore

Top Celebrities M S Dhoni Sachin Tendulkar Vijendra Kumar Saina Nehwal Abhinav Bindra Sushil Kumar
Endorsement

Expertise Cricketer Cricketer Boxer Shuttler Shooter Wrestler

Endorsement Fee Rs 8-10 crore Rs 3-5 crore Rs 1 crore Rs 80 lakh Rs 80 lakh Rs 40 lakh
Risks

Celebrities attract the maximum glare of todays 24x7 media. Even a minor aberration on their part draws censure from all corners of the society. The fallout for the brand she endorses may be devastating in some cases if the person over a period of time has become a synonym for the brand. There is another risk for the brand getting permanently associated with the personality of the celebrity, popularly known as the celebrity trap . In the case of sports celebrities, betting entirely on the performance of the endorser may have a more severe impact on the brand popularity than in the case of artists and actors endorsing the brand. Also, as a rule of thumb, viewing endorsements as a mere substitute for good products would only tantamount to a strategic blunder. In Celebritys Shoes

From a celebritys point of view, the more offers for endorsement she gets, the more she becomes a household name. The subsequent offers only promise a better deal for her. But with every contract signed, she is restricted in her choice and the exercise of her free will is curtailed to some extent, at least in public appearances . It would also be interesting to study the impact on celebrities switching their endorsements for rival brands (most of them doing so in the wake of their being dumped by the previous brand owners). They are sometimes signalled in the media as no-more-good-enough and when they switch loyalty they are berated for chasing only money.

Its immediate consequence is a loss of face, which may hit the lesser mortals more critically than the very established ones. Celebrity Proliferation

The onslaught of mass media is churning out celebrities every day from a plethora of domains. Leveraging web 2.0 platforms , they have been able to garner, engage and entertain their bevy of fans and followers quite effectively. Many of them seem to be mere a flash in the pan, but their impact in influencing consumers is nevertheless felt. So, the relevance of celebrity endorsement is not the heart of the debate today, the crux is, who should we call a celebrity?