The Rarely Practiced Science of Celebrity Endorsements

I recently bought a Nespresso coffee machine because George Clooney is its brand ambassador. I figured if I could even get 10 percent of his charm by drinking Nespresso, the investment would be worth it. After a week, I asked my wife if she noticed any changes. After a short moment of evaluation, she kindly responded, “I think you need to give it more time but also hang on to the receipt.”

endorsement
Creative Commons license. | Credit: Pixabay by NDE

I recently bought a Nespresso coffee machine because George Clooney is its brand ambassador. I figured if I could even get 10 percent of his charm by drinking Nespresso, the investment would be worth it. After a week, I asked my wife if she noticed any changes. After a short moment of evaluation, she kindly responded, “I think you need to give it more time but also hang on to the receipt.”

My personal experiment notwithstanding, celebrity endorsements are big deals, with companies spending tens to hundreds of millions of dollars in exchange for a publicized endorsement of their brand or brands. Estimates on the larger end also include lifetime royalty payments tied to co-branded product lines (think Air Jordan). Nevertheless, most companies will also admit that celebrity endorsements and event sponsorship deals are often driven more by feel than science. As a result, what companies are willing to pay usually reflects the popularity of the celebrity and not the value of the association at generating profit.

This does not have to be so. There is a discipline to evaluating endorsements and sponsorships which can help companies assess the value of an endorsement to the organization. The analysis involves four key elements:

  1. Determining how the two brands fit (company and celebrity).
  2. Identifying potential brand trait transfer, where intended and unintended personality traits of the celebrity can leach onto your brand and vice versa.
  3. Measure potential lift or understand the increased consideration of your product due to the endorsement or association.
  4. Finally, understand when and how to exit the relationship and place a valuation on the downside risk, should the celebrity be caught up in a scandal.

While all four elements are hard to cover in a single post, let’s examine how a good analytical approach can help determine if the celebrity’s or event’s brand fits your company brand? This is important because the celebrity might be very well-known and broadly liked, however, they may not reflect your desired brand attributes. Simply relying on gut to determine brand fit can lead to endorsement deals that range from worthless to just bizarre.

Epic endorsement fails include: Ozzy Osbourne pitching I Can’t Believe it’s Not Butter (weird); Jerry Seinfeld’s endorsement of Microsoft (meh); and Snoop Dogg pitching Norton antivirus software (Wait..what?). Yes, at some point Norton and Snoop joined forces to publicize a campaign called “Hack is Wack,” which included a microsite where you could create your own 2-minute rap song about the problems of viruses, spyware, phishing and cybercrime (Yes, it really happened).

While these endorsement examples seem hilarious in hindsight, they were serious financial decisions made by someone who had good intentions but a skewed perspective of the company brand. Often, the skew develops based on an inward view of the company and its employees or it sometimes reflects the leader’s sheer desire to drive change. Through their efforts at transformation, leaders sometimes see the change before it’s substantial enough for customers to see.

The lesson here is that determining brand fit should be an analytical exercise based on multiple sources of information, including social data, market research and an evaluation of past endorsement deals. Using strong analytics to understand how your target market views your brand and the celebrity brand you wish to associate with allows you to get a realistic perspective of the positives and negatives of the marriage.