Celebrity Endorsements: Waste of Money?

[TREVOFASHIONISTO]

An interesting Article I found...maybe this will change the future of Advertising

As the most significant event in advertising grows nearer, it will be interesting to see how many brands enlist the endorsement services of celebrities during the Super Bowl. After all, popular wisdom asserts that getting a celebrity endorsement is a tried-and-true, simple-to-implement way to maximize advertising effectiveness. Sure, it's expensive, but celebrities always yield stronger ties with viewers and, ultimately, greater sales, right? Wrong. Over the course of last year, time and time again we observed incredibly low effectiveness scores of TV ads starring celebrities. From Tiger Woods to Donald Trump, we found that with rare exception, celebrity endorsements were largely ineffective and failed to yield the benefits popular wisdom promises.

We set out to understand whether celebrities today are really worth the significant investment that brands were making. We studied every nationally televised ad for the first 11 months of 2010 and found that celebrity ads performed either below average or merely equaled it. Specifically, our study, 2010 Celebrity Advertisements: Exposing a Myth of Advertising Effectiveness, 2010, showed that fewer than 12% of ads using celebrities exceeded a 10% lift, and one-fifth of celebrity ads had a negative impact on advertising effectiveness. Why was this? Were celebrities losing their pizazz in influencing consumers? Had the age of social media and consumer control ushered in a new consumer that is not as easily won over by a famous face?
In fact, yes. Today's consumer is a totally different animal than the consumer of even five years ago, meaning that what was effective and influential five years ago is not necessarily so today, as today's consumer is more likely to be influenced by someone in their social network than a weak celebrity connection. Today's consumer is informed, time-compressed, and difficult to impress, and they are only influenced by ads that are relevant and provide information. They don't want to have products pushed at them, even from a celebrity. In fact, the data show that relevance and information attributes were key missing ingredients from most celebrity ads.
2010's Worst Celebrity TV Ads by Negative Lift (Sink)
Celebrity Brand Ad Title Lift 1 Tiger Woods Nike Did You Learn Anything? -30% 2 Lance Armstrong Radio Shack No Emoticons -28% 3 Kenny Mayne Gillette Good Segment -28% 4 Dale Earnhardt Jr. Nationwide Auto Insurance Coverage at the Right Price -27% 5 Donald Trump Macy's Making Timmy a Mogul -24%
Not surprisingly, Tiger Woods led the list of the worst celebrity endorsements of 2010, along with other sports figures, including Lance Armstrong and Dale Earnhardt, Jr. Mired in controversy, Tiger's sponsors chose to address his "mistakes" in their ads rather than the products that he was supposed to be hawking.
As rationale for not being influenced by celebrity endorsements, consumers overwhelmingly cited "confusion" about what product the celebrity was endorsing and dislike of the celebrity, two obvious catalysts to Tiger's poor performances, which were equally unpopular across every demographic tested.
Lance Armstrong's "No Emoticons" ad for Radio Shack is another example of this. The ad never actually mentions "Radio Shack" by name, nor are there any prominent storefront, aisle or product shots. A typical open-ended response from a viewer indicated that she "had no clue what they were advertising until the Radio Shack sign comes up [at the end of the ad]."
Likewise, one respondent remarked about Dale Earnhardt Jr.'s ad for Nationwide Auto Insurance: "This ad was too silly and did not really sell me anything. It tried too hard to be funny and missed the mark."
What all of this proves is that adding a celebrity to an ad with an already poor creative message is like rubbing salt in the wound. Instead of serving as a Band-Aid to bad creative, using a celebrity on top of bad creative usually makes the ad even less effective and confusing to viewers.
The bottom line is that good ads stand on their own, and this study empirically shows that a celebrity has little to no impact on an ad's effectiveness. In fact, regardless of gender or age, ads without celebrities out-performed ads with them. (See graphs.)
Just because an ad is incredibly popular, funny and/or viral, that doesn't mean that it is effective with consumers. The same rule goes for celebrities. Just because a celebrity is incredibly popular and achieves fabulous box-office returns and critical accolades does not mean they will provide a similar boon to brands in advertising. In fact, our report empirically demonstrates the very weak and sometimes negative relationship between celebrities and ad effectiveness.
The great news in all of this is that brands should not have to feel compelled to shell out big bucks on a celebrity. Instead, they should be charging their agencies with creating ads that have a strong, watchable creative message (high on attention, relevance, information, desire). Recent ads like Hewlett Packard's "Happy Baby" (Ace Score over 110 points above the tech category's norm) and Sony's "Epic Gaming For All" (Ace Score 124 points above Video Game norm) are great examples of ads that hit the mark in creative messaging, scoring well with consumers without the gimmick of celebrity endorsement.

adage

 

[rayoflight]

I'd say it's true, at least for me. I ignore most celebrity ads; they are cheap. Only thing that is interesting are beauty ads, but that's my fascination with the high art of photoshop, not because I intend to purchase what they advertise. Personally I prefer models in ads, not celebrities, like when I saw Justin Timerlake in Givenchy ads I didn't sniff the bottle. But I did try Pi, because Imo, that ad seemed nicer, more appealing. Maybe because I dig the blue color they used for background and the tech lines.

 

[Street_a_Licious]

i never mind models in ad campaigns, but i bet i'm in the minority here since i don't worship girls who are often gone in 3 years time.

at times i even PREFER celebrities, since there's a higher chance in knowing their personalities.

 

[rayoflight]

So it's kinda like personality (recognizability) vs "look" contest between models and celebrities?
For me it feels as if celebrity ads rely too much on the name and are less creative and therefore boring and not appealing to me.
Plus they are photoshopped beyond recognition and sometimes I really have to read that it's Rachel Evan Wood for Gucci or Monica Bellucci for Dior, because the plastic face that states there at me doesn't look like the person. I know models are photoshopped too, but I don't know that they (can) look different, I don't see them (except if it's someone really huge, like Kate Moss) in movies or wherever and there is no history/back story attached to that face in most cases as it is with celebrities, who are famous for doing something.

 

[Whats Ur Name]

I agree, if anything celebrity endorsements make me not want to buy the product.

 

[Georgi]

I dont know ... I *totally* believe that if I can only get a Rolex ... I will be as good a tennis player as Maria Sharapova. Isnt that how it works?

 

[ultramarine]

the bottomline is .... the consumers are becoming more and more educated about the products they want and the advertising agencies are having epic FAILS about how to approach the consumers ... personally, I think celebs dont even belong in mags .. keep em on film, tv and concerts ...

I just hope this shift grows and lasts

 

[savvysearch]

It doesn't really have to do with celebrity vs. model. As a population, we're developing anti-bodies to advertisement. I think the ones that use celebrity endorsement are the ones that are desperate and need a huge change.

Few of them really take advantage of the person's celebrity. I think Dior and Charlize Theron is an exception and it was a very good campaign.

 

[blueorchid]

Personally, I always roll my eyes at celebrity endorsements for things like drugstore brands of makeup and hair dye. Just because you know that Sarah Jessica Parker doesn't dye her hair with Garnier or that Halle Berry wears Revlon foundation. With a model those advertisements are somehow easier to believe, not that they use them everyday but that what they are wearing in the ad is just an example of the products.

I guess I hate the "lifestyle" aspect about celebrity ads.

 

[WerbowyStegner]

But advertising itself (at least what we learnt in our Business Studies class!) - predominantly focuses not only on getting the consumer to purchase the product but also to 'promote' brand recognition. So with a celebrity endorsement regardless , it will gain instantly more publicity , thus people will notice your brand more.

 

[WerbowyStegner]

Also even if 'you don't want to buy it' , it will still register in your head subconsciously as a brand to consider in the near future - I mean Loreal hardly produces the highest quality products but why is it so well known? I doubt its because of its products alone , the celebrity endorsements definitely 'polish' / ' 'preen' their image

 

[mikeijames]

celebrity endorsements in advertising has had decreasing marginal returns since the sixties, but when celebrites ACTUALLY use and wear a product in their real lives, it does have an impact. all of these 'red carpet' and 'street style' blogs testify to that fact. if a bag get carried by the right celebrity, it sells. period.

 

[Eterna]

It depends on which celebrity endorses which brand / product, and we can only know if it pays seeing the sales figures before and after hiring the celebrity.

not only on getting the consumer to purchase the product but also to 'promote' brand recognition.

OK, but that's not necessarily good for the brand. A celebrity with a bad image can not promote the brand. For me Tiger Woods and Nike damaged each other. Yes, after seeing the Nike ad has been more in my mind, but the message left was: "do not buy this brand that is more worried about making money using the miseries in a celebrity's private life that even used his dead father, rather than developing good products."

So with a celebrity endorsement regardless , it will gain instantly more publicity .

This is money, not from sales, but the brand is saving money not having to hire advertisements in magazines, television, radio, internet... which is very expensive.

When Penelope Cruz is on any news or gossip they sometimes add "the image of Lancome" so free advertising for Lancome. Well, not free, Pe has paid instead of the media that name the brand, but is usually cheaper.
Same with Victoria Secret, pay so much to their models because they are actually (or VS turn into) celebrities and so they advertise VS probably 24 hours a day for their entire life (when is named "Gisele" is still attached to the words "Victoria Secret")

 

[KhaoticKharma]

i never mind models in ad campaigns, but i bet i'm in the minority here since i don't worship girls who are often gone in 3 years time.

at times i even PREFER celebrities, since there's a higher chance in knowing their personalities.

PREACH.
Personally, I find there to be many actresses that are on par, or above, models in terms of their beauty. I'd rather look at Natalie Portman or Halle Berry than Lindsay Wixon or Meghan Collison any day of the week, regardless of how overexposed the former two may be- they're more beautiful, and take beautiful pictures.

I suppose I'm in the minority of liking things the way they are. I'd rather see a celebrity on the cover of a lifestyle magazine, because I am familiar with their lifestyle; models are better in editorials and on the cover of magazines that cater specifically to fashion because the clothes look better on their 6' frames. I find models and celebrities to be equally appealing in advertisements; someone like Nicole Kidman or Keira Knightley just oozes luxury, and as such, they suit luxury brands well to me. Same goes for the Naomi Campbells and Christy Turlingtons. I suppose young, disposable models work well for youthful brands like DKNY or something, but I'd rather see a girl with a proven track record and an identifiable, slightly older (AKA not teenage) face in a big label advertisement, because she looks like someone that would actually wear those clothes, and not just put them on to take pictures and then change into some Urban Outfitters/F21 getup.

 

[Lalique]

celeb endorsements are OK if they actually use the product -- but how many do? and if not, what credibility can a celeb endorsement actually have-- "Buy this product because they pay me money to tell you that? wouldn't be caught dead using it though."

 

[e-v-elina]

well with celebs, for me it's really a hit or miss. if there is a celeb i like, i'll gladly support the brand (which hardly ever happens btw) but if there's a celeb i don't really care for, like eva longoria, the ad just kinda gets on my nerves. i dont know.

i dont really care for models either, but they are models. so they arent "all in your face", if you get what i mean. when i see eva longoria for loreal or whatever, i just wanna turn and walk away...

 

[BetteT]

Personally, I always roll my eyes at celebrity endorsements for things like drugstore brands of makeup and hair dye. Just because you know that Sarah Jessica Parker doesn't dye her hair with Garnier or that Halle Berry wears Revlon foundation. With a model those advertisements are somehow easier to believe, not that they use them everyday but that what they are wearing in the ad is just an example of the products.

Hate to break your bubble ... but models don't wear the products in the ads, either. The makeup artist uses her own personal products from her kit ... various professional products that she prefers which are made for professional use. Rarely will an artist use a store brand, especially foundation and eye colors ... the products are just not aturated enough for high def photography.

And even when you see a make artist crediting a brand, such as "Mary Makeupdiva for Mac or for Laura Mercier", etc. ... they may have not used any of those products at all on the shoot. What they are doing is just naming a brand because they have an agreement with the company that they will get free product for doing that.

 

[blueorchid]

I know that, but that wasn't my point. I said it's "easier" to believe (like they're playing a "role"). Not that I believe it.

Who believes any ad?

 

[BetteT]

Ok ... I see your point.

But I think that most people do believe ads ... at least subconsciously. Ads would not exist if they didn't work.

Of course, we are talking about ads that may not work as well as previously thought ... celebrity ads.

Maybe society has changed so much that "celebrities" just don't hold the cache they once did. At one time, the studios would carefully orchestrate what the press put out about thier "stars". For example, Rock Hudson and Tab Hunter, who were both known to be gay by insiders and the press, but they were portrayed as macho and very heterosexual ... ladies men. People bought into that fantasy .. that stars were more or different that they really were ... that they were somehow better than the rest of us ... almost dieties.

Now, the press puts all the ugly and/or secret stuff all out there, the paps capture it all on camera. We see and hear about how easily celebrities fall into negative situations and how they seem to sometimes "sell their souls to the devil". So, we no longer idolize someone just because they are a celebrity. And we also know that endorsements are very highly paid so we are automatically sceptical that it means anything.

So ... a lot of celebs have lost their luster and their ability to entrance thier audience ... and the advertisers seem to be discovering that the sky high rates they must pay may be a waste of money.

Maybe we will see a major shift ... time will tell.

 

[ChrissyM]

i think it's important to note also... that the article in question here was analyzing television ads...
which can often be a different animal.

when they're talking about people like tiger woods and donald trump is it any wonder that the ads this year haven't been working??

seeing donald trump in an ad doesn't make me want to get my a$$ over to macy's...
if anything it provides further incentive to stay out of there