Celebrity endorsements have long been thought to add value to marketing campaigns and brand messaging. After all, think of how many brands you know with celebrity spokespersons.
But is the key to success having a celebrity endorsement? Would your startup benefit from having one?
Recently, we looked at our favourite celebrity backed startups and shared some of our personal favourites with you here on the blog. The task of sorting through the many and then choosing our favourites was daunting.
Celebrity backings are everywhere.
But do they work?
Why a Celebrity Endorsement?
Traditionally, companies hired celebrity endorsers not to increase revenue but to add value to their company, brand or product. Society is notorious for looking up to celebrities and in some cases, idolizing them and their lives. In turn, when celebrities associate themselves with a product or brand, their followers or fan-base want to be a part of it, resulting in what psychologists refer to as a meaning transfer.
“I think Taylor Swift is extremely talented and cool therefore the company she’s endorsing must be great too.”
In addition to meaning transfer, celebrities are commonly used as endorsers for their credibility. When properly chosen, smart business savvy celebrities can become excellent endorsers of products or companies and because they are viewed as knowledgeable and trustworthy, the endorsed in turn become credible.
“George Clooney has made some very informed and passionate investments in the past – I trust his judgement if he says this is a company to follow closely.”
Celebrity Product Fit
One of the key determinants of the success of a celebrity endorser is if the celebrity product fit is spot on. If the correlation between the celebrity and their public image or knowledge and the actual product is a positive one, then it should suggest product effectiveness. However, if the product a celebrity endorses is a questionable match, it could hurt the product image or its ultimate success.
For example, Oscar winning actress Natalie Portman collaborated with startup Te Cesan to design a line of vegan friendly shoes. The shoes, of course, came with more of a celebrity friendly price tag than a vegan friendly one. The company closed down within a year due to poor sales. Even with one of the biggest names in Hollywood backing their product, no one thinks vegan shoes when they think of Natalie Portman.
On the other hand, Kim Kardashian’s startup Shoedazzle, which began with a monthly subscription model but recently redefined their model to include boutique-style offering of lingerie and clothing lines, has risen to a level of success many didn’t expect – certainly not from a socialite. Why did it work? Because Kim Kardashian is known for her style and knowledge of fashion, ultimately allowing meaning transfer and credibility for the company.
Incorporation of Social Media
Capitalizing on a celebrity’s following and fan base via social media channels is one sure positive advantage to having a celebrity endorser – if you remember to use it. Most celebrities have follower numbers in the millions on Twitter and those with personally run Facebook Fan pages have high user subscription numbers. But their social media influence is only effective if it’s used to promote the company.
When Justin Bieber mentioned social video app Viddy during a television interview, the startup braced themselves for the rise in users and lead generation that would follow. Until it didn’t. It wasn’t until Bieber tweeted from his personal account, that followers should download the app and provided a link that the startup saw 30,000 users immediately.
Why It Can Fail
Even startups with the best celebrity product fit can be destined for failure. Earlier in the summer, when startup celebrities (and founders of Napster) Sean Parker and Sean Fanning launched Airtime; it was a star studded affair. Without the star studded success.
Despite being startup legends themselves, not even celebrities such as Alicia Keys, Jimmy Fallon, Jim Carrey or Snoop Dog could help get the product off the ground with high user traction. While the product did see an increase in users, it was nothing compared to the internet sensation (with less credibility) Chatroulette which had almost two million monthly users in its glory days. The buzz surrounding the event, held in the swanky Chelsea district of downtown Manhattan, seemed to predict a instant crowd-pleaser. But they failed to get the lead generation they’d set forth to achieve.
But what about celebrity followings? Aren’t they worth something? Ara Katz, responsible for handling celebrity relationships for celebrity backed subscription model startup BeachMint says, “Moms in Dallas who tweet often have a better conversion rate than celebrities with 2 million Twitter followers.”
Similarily, a 2011 study conducted by BlogHer found that 20 percent of the women who actively use social media are motivated to try or buy products promoted by a blogger they follow. Only 13 percent are influenced by celebrity endorsements. The study also included that the top three types of products that individuals seek reviews and recommendations for on blogs are consumer electronics (35%), computer hardware/software (33%) and movies (33%).
What Does This Mean For Your Startup?
While celebrity backings are great and all, they aren’t critical to your success but the ideas of meaning transfer and credibility are. By identifying influencers in your market, building meaningful relationships with them via social media, email, or over the phone; you can find your own credible endorsers who may ultimately provide greater value to your startup’s success than a Hollywood star.
Identify influential blogs and reach out to their owners. Encourage user interaction. If your startup offers a service, give identified bloggers the opportunity to try the service out for free in return for a review or shout out on their blog. If you are selling a product, run a contest or two on a popular blog with a requirement that interested entrants must tweet about the product or your site.
As Ara Katz said above, non-celebrities can see better conversion rates than the rich and famous. If you can effectively identify others viewed as credible and meaningful in your market, you are one step closer to securing a relationship of value that will positively boost your success much better than any Kardashian could.