When Celebrity Endorsement Goes Wrong

Marketers, all over the world, generally adopt a short route to gaining product or brand popularity in the market. This usually comes into the picture when there isn’t a good marketing strategy. The quick fix solution proposed in such cases is to pay a celebrity and feature them in your advertising and use them as a celebrity brand ambassador. No doubt, it is an expensive but often an easy solution. Usually, this short cut approach has three challenges: There are, however, three challenges: first, finding a celebrity that aligns well with your brand values; second, ensuring the star actually uses your product and not that of a competitor; and third, hope like hell that the celebrity avoids any scandals while they are the face of your brand.

There are hundreds of examples of celebrity endorsements across a range of industry sectors & products. From cars to sports; from fitness to education – it seems every successful brand in the market has a celebrity appearing for it in its commercials. Back in the 1970s, it was reported that the average person saw between 500 to 1600 ads per day. Without online marketing being a thing back then, most ads could be found on billboards, in newspapers, and on radio/TV promoting the latest products. Fast forward to 2021, and although there are no official figures, the average person is now estimated to encounter between 6,000 to 10,000 ads every single day. It’s no wonder that brands are making a beeline out a celebrity’s door for endorsements. All this works out well for everyone: sales of the brand or product pick up as now there is a strong recall with the help of the celebrity, consumers can make choices easily (like the celebrity – buy the product or service) and finally celebrities’ cash in big time till as long as the contract is alive.

But what happens when celebrity endorsement goes wrong? Celebrity scandals can and do happen. Lance Armstrong reportedly lost $75 million in sponsorship deals when he was found guilty of doping. Olympic swimmer Michael Phelps lost his endorsement with Kellogg’s cereal, as well as speaking engagements with IBM, after a photo of him taking a hit of marijuana. Sharon Stone was dropped from all Christian Dior advertisements in China after she said that a devastating earthquake in the Sichuan province was “bad karma” over the country’s treatment of the Dalai Lama. Michael Jackson, once one of the most bankable stars, was not re-upped by Pepsi after he was accused of molesting a young boy in 1993, charges he vehemently denied. And then perhaps the king of all:  In December of 2009 marketers at Accenture, AT&T, Gatorade, General Motors, Gillette, Nike, TAG Heuer, and other companies faced a difficult decision. After tabloid reports of infidelity and an alleged altercation with his wife that ended in a car crash, Tiger Woods—who had endorsement deals with those firms—publicly apologized for his behaviour. The following days brought more salacious stories. Should the companies abandon Woods or stay the course?

Over the next few weeks investors in firms that used Woods in advertisements lost $12 billion as share prices fell. For managers at those companies, the question became: How to mitigate the damage? Research has shown that firms tend to suffer financially when a celebrity endorser becomes mired in scandal. Firms making no public statement and taking no action—the path most follow—generally do poorly. But there is also a surprise: Companies that engage with a situation and handle it well don’t just stem the bleeding; they come out ahead, implying that these incidents can be an opportunity.

Within the advertising community, it is generally accepted that level of celebrity’s offence decides the course of action. An extramarital affair might not be as damaging as a criminal offense. Companies that hire celebrities react in their own different ways. For instance, Nike likes to hire controversial celebrities, and when something happens with one, it’s much more patient. A brand that doesn’t rely as heavily on a celebrity is much more likely to cut and run. These decisions are also relationship-driven: Although there are contracts in place, friendships or emotional relationships develop too. Lance Armstrong was extremely likable, so when he was accused of doping, people didn’t want to believe it. That slowed the process.

In India too many a times celebrity endorsements have gone wrong. The one that comes to mind is the Malaika Arora Khan and her role in the Zandu balm ad. The manufacturer Emami sent a legal notice to the Arbaaz Khan production for infringement of copyright and using “Zandu Balm” for one Dabangg’s item songs. Later, both entities settled their differences when some parts of the song was used in Zandu Balm advertisements, and Malaika endorsed the brand. It was a tough settlement as Malaika was mocked for endorsing a brand that had no relevance with her personality! The hot potato these days is Byju advertisements featuring Shah Rukh Khan. Ever since Shah Rukh’s son has been allegedly involved in a drugs case aboard a cruise ship, Byju is running to mitigate the damage.

Celebrities are as humans as you and me and it is but natural that they may err from time to time ….like you and me. While it’s for the companies and advertisers to worry about how to stem the damage arising out of celebrity scandal, one thing is for sure – your favourite celebrity does not represent your brand. He or she is doing it more for commercial reasons than for anything else. So choosing the brand should ideally depend on the product or service values and not on the pretty face that you see on the screen a thousand times a day.

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