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8. Celebrity Endorsement: The Issues Involved

There are several factors to consider before resorting to celebrity endorsement. There is no single formula to win in the world of marketing. A company must analyze the prospect of endorsement from 360 degrees, prior to product promotion.

8.1. Price vs. Profit

The most important issue is that of return on investment (ROI). Companies need to perform a cost-benefit analysis prior to endorsement. The process of gauging the effectiveness of endorsement on the overall brand is but difficult. The companies expect to bring, in the long run, future sales, revenues and profit from the present investments on celebrity endorsement. Celebrity endorsement is an expensive means of brand promotion and the price burden almost always shifts on to the consumers; if not, then it narrows the companies' profit.

8.2. Multiple Brand Endorsement vs. Multiple Celebrity Endorsement

In the advertising landscape, we find either a celebrity endorsing multiple brands or multiple celebrities being used to endorse a single brand. Sachin Tendulkar, for example, in 2002 endorsed 12 brands (including Pepsi, Boost, Colgate Total, Gillette, Britannia Tiger, Fiat Palio, TVS Victor, Fiat Sienna, MRF, Adidas, Visa Cards and Home Trade). Tripp et al, says that the endorsement of as many as four products negatively influences the celebrity spokesperson's credibility and likeability.

Figure 3: Multiple Brand Endorsement (Shah Rukh Khan)

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* Contributed by -
Sohag Sarkar,
IBM Global Services (India) Pvt. Ltd.,
Bhopal (MP).